Why Should You Keep A Discontinued Credit Card?

Once you’ve been getting credit cards for different sign-up bonuses and benefits for long enough, eventually one of the cards you have will be discontinued. One day the bank will stop accepting new applications for the card and you’re in credit card limbo. Most of the time banks will allow you to keep the cards open and continue to offer the same benefits as before. This can be for months, years or even decades after the card is initially ended.

The most common reason a card is discontinued is that the bank is refreshing a product and decides to relaunch the card with a new name and new benefits. However, there are sometimes where a bank just decides that the card is no longer a good fit for their portfolio. Another reason is contractual, such as when AMEX lost the Costco contract or when Citi’s Hilton agreement ended. In these instances, you’re not able to keep the old product and will either be offered a different card from the old bank or the equivalent card from the new bank.

Back to discontinued, yet still active, cards. Should you keep them? What’s the advantages and disadvantages of doing so?

I have a collection of cards in my drawer that are no longer available for new signups. They’re not ones I use all the time, or hardly at all, but I have reasons why I haven’t canceled them yet.

AT&T Universal Rewards

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Ah, the AT&T credit card. You lived in my wallet for quite a while for your unique benefit. If you’re old enough, you’ll remember when this benefit was a huge perk!

As an AT&T Universal Cardmember, you’re eligible for 30 free phone minutes per month and 2 free Directory Assistance inquiries per month by calling 1-800-308-6537. You can take advantage of these benefits anytime, anywhere and from any phone. There’s no need to change your calling plan; the phone minutes and Directory Assistance inquires are not associated with your home phone service.

That’s anytime, anywhere. Even international. I vividly remember having to buy phone cards to use a payphone in London and in Japan. There was also a time when if you wanted to get a phone number, you called the phone company to look it up for you. Has anyone tried to see if 411 even exists anymore? Well, this card also provided two free 411 searches a month.

Once using a payphone and calling for directory assistance became less popular, Citi started offering Thank You points for this card, which I totally ignored at the time. By the time I looked, I had earned over 10,000 points. I cashed them out for restaurant gift cards but once I signed up for the Citi Thank You Premier, I could transfer points between accounts and then transfer those Thank You points to airlines or hotel programs, like Singapore Airlines.

Citi sends me offers to change the card to other products in their current product line. I’ve held off because they constantly send me bonus offers for this card. Currently, I get 5X points for all my restaurant and Drug Store purchases. I’m also afraid that product changing this card will reset my Citi clock and prevent me from getting a new Citi card sign up bonus. If/when I do sign up for a new card, I’ll probably change it but for now I’ll just keep racking up 5x Thank You points in select categories a few times a year. The card has no annual fee, so there’s no harm in keeping it.

IHG Rewards Club Select

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Oh, the IHG Rewards Club Select card. I think I’m going to keep this card as long as Chase will let me. I’ve already given a full review of the card but as a reminder, for the card’s $40 annual fee you get several benefits including automatic Platinum status, 10% rebate on award stays and a free night certificate (now good at hotels costing up to and including 40,000 points per night).

I could change to the IHG Rewards Club Preferred card but that card has an $89 annual fee and provides a fourth night free on award stays and the same free night certificate. I might just apply for that card and have both since people have reported the benefits stack (Book a four-night award stay, get the 4th night free and 10% rebate). For now, I’ll just keep Sharon’s and my versions of this card, instead of upgrading.

Barclays American Airlines Aviator Red Card

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I know the Barclays Aviator Red card isn’t “technically” a discontinued card since you can still apply for it when visiting airports and when flying on American’s airplanes. However, my version isn’t one you can reapply for today.

This card was originally the US Airways Mastercard. When American merged with US Airways, the card was rebranded as the Aviator Red.

US Airways Dividend Miles Mastercard

The special thing about this card for me is that when I signed up for it, I managed to get in for an offer that provided 10,000 miles on each card anniversary. So I’m paying $95 for 10,000 points every year. The card still provides benefits like the first checked bag for free and a 10% rebate on award travel. We have plenty of American points and no use to redeem them but we also fly American a bit (even if they don’t let us bring our rollaboard bag without a fight, more than once) so the free bag perk comes in handy. I’ve also called several years for a retention offer and Barclays waived the annual fee (and still paid the 10,000 miles).

American Express Optima Platinum Card

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See that Member since 1992? That’s the main reason I keep this card. For those who remember, the Optima card was American Express’ first dabble into the credit card market, as they previously only issued charge cards (to learn the difference, check out this article). Since I had a Green Amex card, they offered this card to me.

It does earn membership rewards points at one point per dollar spent. For a while, it was worthwhile to keep because I was able to sign up for AMEX offers with this card (until AMEX shut down adding offers to multiple cards). For now, I only keep it because the long account history helps my credit rating and I’m also able to transfer some of my credit line to this card if I’m looking to cancel one of my other AMEX cards. Eventually it will go away but for now, I keep it for sentimental reasons.

Final Thoughts

Four examples and four different reasons to keep a discontinued credit card. You could categorize the reasons as followed:

  • Benefits not provided by the replacement card
  • Negative impact of applying for a new card
  • Length of account history (negative credit score impact if closed)
  • Sentimental reasons (not really a good reason to keep a card)

Just like all my other cards, I still review these cards once a year to see if they still fit into my card portfolio. The no-annual-fee cards have no good reason to cancel but the IHG card and Aviator card need to earn their keep or they’ll end up meeting the shredder.

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This post first appeared on Your Mileage May Vary

 

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