when you're at the register with a
purchase the offer of a great discount
if you sign up for a store credit card
can be very tempting but store credit
cards are a little different than
regular credit cards so it's a good idea
to understand how they work before you
sign up many large chain stores offer
their customers store credit cards that
come with discounts or other rewards
some store cards are offered in
partnership with a bank or a major
credit card company in which case you
can use them wherever you would use a
regular credit card but often you can
only use a store card at that particular
store store credit cards often come with
a number of perks like in-store
discounts coupons special shopping days
sales and other benefits like being able
to return an item without a receipt some
may offer cashback or rewards points
that can be redeemed at the store and
some store credit cards might be easier
to qualify for than traditional credit
cards offered by a bank a credit check
is still required but customers with
lower credit scores who might be turned
away for a traditional credit card might
have an easier time qualifying for a
store credit card so someone who is
looking to establish a credit history or
wants to rebuild their credit may be
able to use a store credit card to do so
on the other hand there are some
potential drawbacks to store credit
cards aside from the possibility of only
being able to use it at a specific store
they often carry higher interest rates
than regular credit cards a regular
credit card might have an interest rate
around 13% while a store cards rate
might be 20% so if you carry a balance
from month to month that higher interest
rate could make a big difference in what
you owe and the additional amount you
owe an interest might end up costing
more than what you saved from any
discounts that came with the card and
with some store cards if you carry a
balance from month to month that
interest rate could increase there are
also some store cards that might offer a
0% interest rate on a large initial
purchase for the first six months or a
year you might not be charged any
interest on that item but with certain
cards if you haven't paid off your
entire balance within the given time
frame you could be charged for all the
interest that would have accrued on the
purchase from day one
and also keep in mind that applying for
multiple credit cards at once can result
in multiple credit inquiries which might
negatively affect your credit score and
opening additional lines of credit could
impact your ability to sign up for other
types of loans or other credit cards a
lot of times people make decisions at
the register to sign up for store credit
cards to take advantage of good
discounts but if you have second
thoughts remember that you can always
cancel your card as long as you've paid
the balance on it so the next time
you're weighing the benefits of a store
credit card remember to find out a few
things first ask if there's an annual
fee find out if you can use the card at
other stores ask what the interest rate
is and if the rate will go up if you
carry a balance from month to month if
the card has a 0% interest rate for a
certain amount of time ask what the
penalties are if you don't pay off the
card in that timeframe and read the fine
print make sure you understand all the
terms that come with the card knowing
the details can help you decide whether
a particular store's credit card is
right for you