Store cards are a special brand of credit card that department stores trick people into signing up for with promises of huge benefits. Unfortunately they dont usually highlight their huge interest rates and outlandish charges. Now before I get sued I better say that not all store cards carry massive interest rates… but I’m yet to find a good value one.

These cards can be used by the stoozer to take advantage of special offers and priviliges that come with their ‘exclusive’ membership:

Members only events; previews to sales & special discounts. Many department stores do have genuine offers for members only. I had a store card that gave me access to a special storage locker where I could leave my shopping for later collection. Member parking is another popular bonus.

Extra discount; on the day you sign up for the card (usually in store) you may be lured in with the promise of a 10% discount on the days shopping. 10% is less than the store’s margin anyway, and can encourage you to buy more than you had intended. Generally the store card interest will recover the 10% within a few months anyway!

If these advantages appeal to you there is nothing wrong with owning and using a store card but please please be sure to pay the balance off in full every month. If you can’t do this, then you shouldn’t use one. Holding a store card is only for the strong willed!

If you currently hold a store card with a balance that you cannot pay off in full every month, do your self a favor and transfer the balance to a 0% or low interest credit card.

Be aware when applying for a store card that credit checks will be made that can have effect on your credit rating. You might be ‘using up’ a credit application that could be better used on a different credit card.

This entry was posted on Wednesday, February 7th, 2007 at 2:04 am and is filed under Store Cards. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.