Finances & Money

3 Reasons To Pay Attention To Your Debit Or Credit Card Expiration Date

We have a food home delivery person come to our home once every two weeks. They have some nice specialty products that either cannot be found at your average grocery store, or are better quality. After giving the salesperson my order last night, I told him to use the debit card he had on file. I saw him punching buttons with a confused look on his face.

“Your card is being declined for some reason. Did you get a new one recently?”

The number he had on file was my wife’s debit card, and she had received a new one within the last week. When she activated her new card, the old one was deactivated. Mystery solved.

Our card was declined because the number on file was a recently deactivated card.

If you’re a person that automates your payments, this is a scenario you have to be wary about each time you get a new card. Automatic payments may not go through, which can have some serious consequences.

Late Fee

By the time you get either a courtesy notification from the payee, OR the next statement you’ll likely have a late fee tacked on to your bill. Late payment penalties range from a few bucks from a utility company to $30 or more from a credit card or mortgage company.

Interest Rate Hike

Credit card companies cannot raise your interest rates until you are 60 days late, and even then it’s only on new purchases. But, if difficulties due to a new card are not noticed OR there are accumulation of events one might end up in a situation where the interest rate for new purchases is increased significantly.

Credit Report Hit

A creditor has the ability to report a late payment to the credit reporting bureaus. Your credit score could also then be impacted. Both late payments on your credit report and a lower credit score can impact your ability to secure credit for a car loan or a mortgage in the future.

Debit and credit cards have an expiration date. If you automate your finances in any way, each time you get a new card make sure you update your method of payment to avoid any of these unnecessary fees and consequences.

Have you ever forgotten to update your method of payment when you activated a new card?

Brought to you courtesy of Brock

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Brock Kernin

Brock is a software engineer by day and personal finance blogger at night. He is a fitness junkie and enjoys grilling and smoking meat. Married with two children,  Brock strives to improve his skills as a husband and father, and is always on the lookout to stretch his family’s budget as far as he can.