We have only one store credit card, for a large home improvement chain. We got it when we were redoing the flooring of our home, so that we could buy the flooring with credit with zero interest for a year. Sales associates at many stores (Target, Kohl's, Jcpenney, Sears, Meijer, etc) often ask me to open up a credit card with them (I know that the associates need to make a quota of so many card applications earned, I don't mind politely saying "No, thanks"). I have often wondered, which store credit cards are worth applying for? Which ones have the best perks? Are there any that offer special offers, sales, coupons, or discounts?
I don't bother with them any more personally. I used to have credit cards for all the major department stores when I was in my early 20's but to be honest, they were just ripping me off with higher interest rates than my regular credit cards. They lure you in with some initial deal up front, then recoup all of that with higher interest down the road. Plus if you have too many credit cards open and your balances too close to your limit on each, that will look bad on your credit reports. It's kind of dangerous having store credit cards on hand, even if you don't have a balance on them currently, because they can tempt you to make purchases even when you really shouldn't. All those monthly payments on a bunch of cards can add up real quickly and not even make a dent in the amount you actually owe, since the minimum payments are primarily just paying off interest.
I personally wouldn't go with them. I don't know how it works where you are, but in the UK you do get interest added and if you're not careful, it can quickly spiral out of control. What I sometimes used to do instead, is say yes because more often than not, you get a 10% discount on the day. I'd use that up and then cut the card up on getting home. So I totally agree with ohiotom.
I did take one out once, whien I bought my first house. There was a 10% discount on purchases made that day, plus there was a year interest free. So that was a good deal for me as it enabled me to buy a lot of the things I needed in one go. On the whole though, interest is usually charged and it's at quite a hefty rate. I really don't like the way these cards are pushed onto people at the point of sale either.
I am working on rebuilding my credit and store credit cards are typically easier to obtain than major credit cards so that is why I use them. Except one I saw had an interest rate of like 27 percent. Forget that!! There is a rip off and then their is a rip off. I mean I don't run a balance, but that is highway robbery!
Credit cards by stores used to be popular until people realized that the credit card can only be used in that particular store. When bank credit cards got easier to have, those store credit cards lost its glamour. Now stores have their reward cards where you get credit (thru that card) whenever you buy something from their store. The most popular is the SM Advantage card followed by Robinsons.
Wow, you were really lucky to get a whole year interest free, @missbishi! I bet there are no offers like that anymore, the stores have become greedier and greedier.
I would be careful with the store credit cards. I had a Sears card and never used it much. I think I only applied for as I could get a$25 rebate on my purchases that day. Needless to say it was in my wallet and this summer my purse was stolen. The thiefs were able to change the pin number on my Sears credit card and do cash advances off the card. Luckily I am liable for the money but what a pain it was and a feeling of violation. It was so easy to change the pin number as they could do it by phone and all they needed was some personal information which they could find in my wallet. I checked with Visa and this could never be done with a major credit card.
I'm not a fan of store credit cards. I'm not against credit cards completely, but I think you should limit yourself to one or two, and pay them off each month. I wouldn't allow interest to rack up. A lot of these store credit cards will accrue a lot of interest if you aren't paying attention. That's why I avoid them.
I think store credit cards are a good way to get people to spend more money. That's why the stores have them, so that they can entice the customers to buy more now and pay later. The problem is later, there will be a huge bill with interest attached to it. I had a friend that would get the credit card just to get the benefit offers that most of them have when you first sign up. She would then pay off that first bill and cancel the cards. That might be the only way to do it.
I have a few store credit cards for the offers that they give me for using it. Peebles' is the one that I use most often because of the added coupons and incentives for using it. I have gotten items for 75% off by combining the weekly sale and an additional percent off coupon that is issued to card holders only. I pay it off before it is due though because the interest rate is much higher than I can pay. The thing I try to remember when I am offered another card is that my credit rating can be negatively affected by having too much credit even if I don't carry a balance.
I have only one store credit card because they give discounts in the store's products and also if you go to the movies. But even so, I'm not sure if they are worth it. I would not make a different credit card for each store. Credit card bills are already hard to monitor and control with a couple credit card, imagine several from different stores and different payments.
Like @ohiotom76 I had several of these in my early 20's. I've since given them up, but I would consider getting perhaps one or two for the deals offered, as long as I would be able to pay off the balances each month. I try not to keep balances on anything, because the interest charges add up quickly, and as mentioned, the rates on these store charge cards tend to be much higher than credit cards in general.
I don't have a store credit card as I have been a cash only person for so many years. I will get a credit card soon to establish some credit as no credit is as bad as no credit. I will avoid the store cards because of the higher interest charged on those type of cards.
Yes it's important to be careful with opening credit cards at stores. Every time you apply for one they run your credit and it causes it to go down. I'm personally not a fan because I just have one credit card that gives me points for purchases. I stick to that and pay it off. Store credit cards often have very high interest rates.. That's how they make their money.
OMG that was a horrible experience for you, purplepen88!! I can't imagine how that must have felt. I no longer do the store credit cards anymore. But when I did used to, it was solely to get the 10% discount on the day. Once I'd secured that, i'd head home and cut the card up, because being an avid lover of shopping, I could very easily be tempted to use it to get stuff on credit and I just hate being tied into situations like that. It's a good thing you weren't expected to pay back all that money!
I have one store credit card, and I use it chiefly because I pay the balance off every month. It is a tool to increase my credit rating. Also, this particular store, Peebles, has really good sales and opportunities for purchase, so I really like it. I use the card sparingly, but when I really need something I will use it.
I used to work for a few retail stores that have credit cards, and I would say that it depends on how much you shop there. A lot of stores have fairly large (10%) discounts just for using your card there, and the discounts can be as much as 25% with coupons. But fair warning: the interest rates are a bit big. Also, if you're an occasional shopper, there are often discounts for people who don't have credit cards, and on other days there are good discounts if you have a card or not. I would say that the absolute best time to sign up for one would be around the holidays or if you are making a large or a expensive purchase. The sign-up bonus is pretty good, and that will help save you some money. Want a really good deal? Sign up for a card in January or February, when the sales are slow. Some stores will throw in an extra percentage off to get you to sign up so the store can meet their quota. Don't go demanding it, because this is kind of off-policy. Hope this helps!
I have an Amazon Prime store card and I get 5% back on everything I buy with that card. I have a Walmart store card and I get 3% back on everything I buy at Walmart.com with that card. I also keep a Dillard's store card because I get an early heads up on when they put on their big sales. And cardholders get to come in one day early for their sales too. Yes, a few cards are worth it. I don't keep all these in my wallet, but rather in a safe place so that I can get to them if I need them. You don't really need your online cards in your wallet at all.
Frequency of purchases in the stores matters. They're definitely worth getting if you know that you're going to be spending money in that store on a regular basis. For example, I don't think the home improvement card was a good idea because you won't be renovating the house or buying something new too frequently. OTOH, getting a Target card or similar would actually help you because they'll have some form of loyalty/reward system that can be used. Plus, you get discounts on things. For example, the red card gives you 5% discount. Again, frequency matters.
