What Happens When Your Credit Card Expires?

Today, you will be hard-pressed to find a consumer who doesn’t have at least one credit card in their wallet. When used properly, credit cards can be an excellent tool for building a strong financial future. However, credit cards have an expiration date, which is one aspect of having a card that some people find bothersome or confusing. Here is a look at what happens when your credit card expires, and the things you should look out for as a savvy consumer.

Key Takeaways

  • Expiration dates on credit cards refer only to the expiration of the physical card, not your credit card account.
  • Credit card companies use expiration dates to replace cards that may be damaged through normal wear and tear and for fraud prevention.
  • When cards expire, companies often take the opportunity to send new cards with updated logos and designs.

Why Do Credit Cards Expire?

Credit cards have expiration dates for several reasons. The first is to allow for normal wear and tear of the physical card. (Only the card itself expires, not the credit card account.) The chip on the card can become worn, and plastic can break. So at certain intervals—typically every three years—your credit card company will send you a new card. 

The second big reason is fraud prevention. Whether you’re using the card in person, over the phone, or online, the expiration date provides an additional data point that can be checked to make sure the card information is valid and you are the legitimate user.

Other reasons for expiration dates: They present the card issuer with a marketing opportunity and a chance to periodically re-evaluate the terms of the credit card based on your current creditworthiness. Card companies also may use the expiration date as an opportunity to send you a card with an updated design or logo.

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What to Do When Your Credit Card Expires

Many credit card companies send out a notification of your credit card renewal as well as a new card in the 30 to 60 days leading up to the expiration date on your existing credit card. Other companies will send you a letter or email asking if you would like to renew. 

Confirm That the Credit Card Terms Are Still the Same

Before accepting your new card, confirm that the credit card terms and conditions remain the same. Verify that the annual percentage rate (APR) —the interest rate you pay—is still the same. Also make sure that payment due dates, fees, and penalties remain the same before renewing your credit card. Rather than being caught by surprise after you renew with your credit card company, get all the facts in black and white first.

Activate Your New Card

Before you use the new card you receive, you will need to activate it. Typically, the card will come with a sticker indicating a website address where you can activate the card or a toll-free number to call. After the card is activated, sign the back with indelible ink. After you have done that and added your new credit card to your wallet, be sure to cut up your old card and discard it. You don’t want your old credit card information to get into the wrong hands. Be aware that many newer metal cards can't be cut up and need to be returned to the card company; the issuer should provide a postage-paid envelope for this to ensure it's returned safely.

Finally, be sure to update any automatic payments you’ve been making with the credit card to reflect the new card details, such as the new expiration date. Your CVC value will also likely change, so if you do a lot of online shopping, take note of the new number so you can easily provide it for your digital wallet purchases.

One reason credit cards have expiration dates: The chip can become worn, and the plastic can break. Additionally, security features may be added at card reissue, and sometimes legacy features are removed.

When You're Asked to Upgrade

When credit cards expire, the credit card company has a prime opportunity to market new products to its customers. As you decide whether to stay with your old credit card or upgrade to a product with different features, be sure to compare the various card offers against the benefits of your old credit card. By carefully researching any cards the issuer offers before you make your selection, you will know what to expect when that first bill arrives.

The Bottom Line

Facing a credit card expiration date can be a bit confusing, but generally, there's little reason to worry. Credit card companies do not want to lose business. That's why the company that issues your credit card will contact you when your credit card nears its expiration date. This is a prime opportunity for the company to remind you of all the products it offers and keep you as a loyal customer. Before accepting any particular offer, do your homework so that you are using a card best matched to your current financial needs and spending patterns.

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