Some financial planners recommend cutting up your credit cards when you want to get out of credit card debt. The concept is simple: If you can’t use the cards anymore, you can’t accrue any further debt. However, cutting up all of your credit cards might actually be a bad idea. Here’s why you should consider keeping at least one credit card un-cut and available:

Availability of Future Credit

Let’s say you have five open credit card accounts, you’re in debt, and you’re trying to get out. Your first hint of credit trouble was when you applied for two new cards, but you were denied. You decide the best way to decrease any future credit card debt is to cut up your cards.

Now let’s say you do it–you destroy them all and then close the accounts. What happens if, in three months’ time, you realise it was a mistake and you want a new credit card (whether for emergency expenses, travel, or some other reason)? Not only would you then have to wait on another application approval (and having a new card sent to you), but with the previous denials of credit and your delinquent accounts still displaying on your credit file as enquiries from the last five years, you may have a difficult time establishing a new credit line.

Travel (Especially International)
If you travel frequently, it may be in your best interest to keep at least one credit card open and on-hand. Credit cards are much safer than cash and many can double as a Debit Card to load your own money on. Not only do many international flights only accept cards for in-flight purchases, but many car rental locations around the world require a major credit card when you pick up the car (not all rental companies in all locations accept debit cards, and those that do may place a large hold on the cash balance of the account tied to the bank card until you return the car).

Emergency Funds

There’s nothing wrong with wanting to live within your means by adopting an all-cash lifestyle. But if an emergency crops up, will you have enough cash on-hand to deal with it? Not everyone will. Unless you have a significant cash emergency fund stashed away to handle car repairs, or other unexpected expenses, a credit card may be your best backup option.

Interest Rates

Because the number of credit applications you make can play a role in determining your creditworthiness with credit card companies, applying for a new card now or in the future might not give you the best interest rates. If you happen to have an older card with a low interest rate, it might be smarter to keep that card for active spending when needed than assuming you’ll be able to get the same deal again down the road.

Improves your Credit Rating

Spending on your credit card and paying off the balance without missing any payments provides a good credit history. It shows banks that you are credit worthy and can help you in future when you need to apply of other credit options such as a home or personal loan.

While cutting up credit cards can help those who can’t control their charging habits on their own, make sure you don’t make a rash decision. Consider your lifestyle and income to see if you’ll need those emergency funds or an open credit card account for travelling before destroying your cards and having to explain the need for a replacement to the bank.

Instead, consider locking them in a lock box or safe while giving the key to a trusted friend or family member. Focus on finding a balance where you can control spending and get out of credit card debt, but do so with consideration of your typical needs.