You’ve probably heard stories about people who had their credit cards ruined because they placed them too close to a magnet. Sure enough, your credit card contains a magnetic stripe, and the common advice is always to avoid placing magnets together lest they affect each other and ultimately ruin their magnetic capabilities. That is called degaussing.

But the fact is that most people have never experienced such a situation. Magnetic stripes are used everywhere from credit cards to rail passes to card keys. But failure of these cards by degaussing is rarely, if ever, observed.

In fact, the magnetic strips embedded in these cards are usually made of “hard” magnets such as ferrous oxides and are protected by a strong plastic film against physical abrasion. Card manufacturers know that credit cards go through a lot of wear and tear, and it’s in their best interest to make them as durable as possible. Damaged credit card exchanges cost them millions of dollars each year.

Most of the time, credit cards fail to register in the swipe card machine due to dirt on their surface (or are declined because the user exceeded their credit limit) and not due to magnetic failure. That’s why most cards work again after cleaning them with your shirt or hand.

However, demagnetization still occurs in some situations. The magnetic strip is a very durable magnet in itself, but there are even stronger magnets that can demagnetize them. And these magnets are actually found almost every day in our daily activities.

refrigerator magnets

The magnets used in (not on, those little decorative magnets are harmless) refrigerator doors to keep the refrigerator closed and tight are actually very large and strong magnets. You may not realize it, but it takes a strong, highly durable magnet to handle that frequent opening and closing and still hold the heavy door. Without the magnet, your food would have probably spoiled. Naturally, the one thing you shouldn’t do is swipe your credit card against the refrigerator door magnet. Of course not, but sometimes it happens that you put your credit card very close to the refrigerator door without realizing it. There have been cases where people tossed their cards into their shopping bags after a round of shopping and left them together in the fridge.

Magnetic resonance imaging or MRI

This is one instance where you need to be careful if you are ever in the hospital. MRI used to scan the inside of your body using magnetic fields, and as you may have guessed, if it’s strong enough to penetrate your body, protective wallets and card holders won’t be much help. I wouldn’t expect you to wear one for an MRI, but you might end up in the room for other reasons (work there or tag along). If you forget, you could end up losing not only your credit card, but all your other cards as well.

wallet magnets

Some wallets or purses have a small magnet to hook the compartment covers. They are generally not very strong and are unlikely to cause demagnetization. However, I haven’t done any real experiments to say it won’t, so the best advice is to not place your credit card directly where the magnet is. Over time, and in such close proximity, who’s to say it won’t?

physical demagnetization

While most people understand that other magnets can potentially demagnetize your credit card, they don’t know that magnets can be demagnetized by physical conditions such as heat, cold, mechanical damage, or even moisture.

Magnets result from the alignment of many small domains that produce a uniform field strong enough to be observable. Magnetic strips make use of this and align the domains to record data that can be interpreted by the slip machine. Heat and cold can disrupt these alignment patterns and cause data corruption.

What can be done if demagnetization actually occurs?

So what if you really are one of those rare cases where a credit card went bad? Well, unfortunately for you, you’ll probably only find out the next time you make a card payment. Therefore, you will most likely find yourself in an embarrassing situation where the cashier declines your card and others in the queue guess that you have exceeded your credit limit.

Fortunately, a swipe reader is not required to use a credit card. Your card’s magnetic stripe actually contains the 16- or 21-digit card number, as well as its expiration date. Swiping the card simply enters them into the system, and the system then checks their credit before requesting the transaction. Then you can simply ask the cashier to manually enter those digits into their reader. Alternatively, the cashier can always call their partner who processes your card transactions and read them the same information for processing.

The easiest way is of course to use a different card if you have one, but even if you don’t, just have the cashier go the extra mile to process it. Businesses won’t say no to your money (unless you don’t have any money), so don’t worry about hassling them to process the card; they will be happy to do it for you.