Compare Top Department Store Rewards Credit Cards
Almost every major retail store has their own credit card. Some can be used anywhere while others can only be used at that select retailer. Stores make it easy to apply and start using a line of credit the same day. However, one should carefully consider whether adding another card to their wallet is a good thing or not. We’ve searched long and hard to find the best rewards credit cards that can be used in department stores and else ware.
The Pros And Cons Of Store Credit Cards
Access To Special Discounts
The reason most people apply for a store credit card to begin with is to receive access to exclusive discounts. Some retailers offer as much as 50% off your first purchase or a set dollar amount off your first purchase with sign up. You will also receive regular offers such as special sales and coupons. You will have to use your credit card to take advantage of the discounts, though.
High Interest Rates
Very few retailers offer what would be considered decent interest rates. Most cards have an APR of at least 18% with some going well over the 20% mark. Some retailers may offer an introductory rate around 10%, but this is rare. Since you have a store card, you may be tempted to buy more to take advantage of all the discounts you receive. When the bill comes, you are suddenly faced with a large amount you may not be able to pay off. You are then hit with higher interest rates that could cancel out anything you may have saved.
Considering the high interest rates, it may actually be a good thing that most store cards have lower limits than your average credit card. Limits typically fall below $2000, but this does vary based on the type of retailer. Higher end retailers may offer higher limits to ensure you can easily purchase your favorite items.
This limit may be increased the more you use the card. Always paying on time is a great way to increase your limit if you need it.
While many retailers let you decide how often you use your card, some cards may result in an annual fee if you don’t spend a certain amount or use it frequently throughout the year. It is important to pay attention to the fine print when signing up. Since you usually sign up in the store, you may feel the need to rush through the application. Take your time since it is your credit on the line.
Increase Or Establish Credit
If you’re looking for a way to quickly increase your available credit on your credit report, store cards are easy to get. For those looking to establish credit, these cards are often the best way to get started. Interest rates may be extremely high and limits are likely low, but with regular use and paying off the entire amount each month, you can establish credit to gain access to better cards in the future.
It is tempting to get a store credit card everywhere you shop. However, for the best benefits, limit the number of cards to where you shop most frequently. Too many cards can actually hurt your credit score. Fewer cards equals less temptation to take advantage of discounts. Only apply for cards you are likely to use often that offer the best discounts possible. This helps you save money and improve your credit at the same time.
Store credit cards are a wonderful thing. When used wisely, they can save shoppers hundreds or even thousands each year. For best results, pay the full amount each month and interest rates won’t be a problem.