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Should I Get a Store Credit Card?

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Should I Get a Store Credit Card?7/26/2018

You’ve probably been asked when checking out if you would like to save 10, 15, and even 20% off your total, by getting a store credit card. While this discount can be very tempting, are store credit cards worth it in the long run? Read on to find out!

Store Credit Card

Are there pros to a store credit card?

The two pros of a store credit card are the discount when you initially sign up, and then continued discount offers throughout the year. These are also two of the main reasons people sign up for store credit cards, but these pros often do not outweigh the cons of a store credit card.

What are the cons of store credit cards?

Once you begin looking closely at store credit cards the cons can quickly add up. The first starts in the store, while you’re still signing up. Store credit cards have the same agreements and legal documents to go over as regular credit cards, but this information is often not available in checkout lines. Even if it is, you may feel pressured to not read it all or as closely as you should, especially if people are waiting behind you. If you are also signing up for several store credit cards it can damage your credit score. Every time there is an inquiry into your credit your credit score will drop slightly. The biggest con is the high interest rates. These tend to be much higher than interest rates on regular credit cards, even as high as 30% or more. Paired with the typical low credit limits that will raise your debt-to-income ratio, it can be very easy to rack up debt and end up hurting your credit limit.

Are there alternatives to store credit cards?

 Yes! Some people choose to get store credit cards because they are trying to build credit or already have a low credit score, and they’ve heard store credit cards are easy to qualify for. Credit cards from credit unions can also be easier to get, because often credit unions like PCU are willing to work with those who don’t have perfect credit. Credit cards from credit unions also don’t have higher interest rates, and great rewards programs!

Are you looking for a new credit card? Check out the Platinum Rewards Mastercard from PCU! It has no annual fee, theft protection, points on all your purchases! Apply online today!



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