When is a Retail Card a Good Idea?

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by Mario & Jennifer Ruiz  04/17/2019

We’ve all been there. You’re at the register about to buy the thing you’ve been eyeing for a bit, when the cashier asks, “Would you like to save 15% on your purchase and open a store credit card?”

We’ve all been there. You’re at the register about to buy the thing you’ve been eyeing for a bit, when the cashier asks, “Would you like to save 15% on your purchase and open a store credit card?” Before you jump in, take a step back to determine if this move is right for you. These best practices for opening and managing your retail credit cards can help you weigh the pros and cons – and ultimately how this card could affect your credit score.

When To Say No

* The interest rate is abnormally high and the credit limit is low

* You’ve recently opened other lines of credit

* There’s a major temptation to overspend

When To Say Yes

* Your credit score is in good shape, and you can keep up with an additional bill

* The discount is significant, which is often the case with larger purchases, like appliances or furniture

* You frequent the retailer and believe you will use the card reasonably

PRO TIP: Make sure you pay your bills on time and keep your balance low. Your credit score will be affected by your debt-to-credit ratio.

Some major retailers let you pay the credit card bill in store. Let’s say you charge a purchase in the store on the credit card to earn points or rewards. Immediately following the transaction, you can opt to pay that bill with your debit card either at the register or at guest services. Participating retailers include:

*Target

*Macy’s

*Nordstrom

*Kohl’s

 

 

 

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