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Pros & Cons of Store Credit Cards: Are They Worth it?

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