Should you sign up for those store credit cards?

Hands up if that happened to you. We received from you tons of questions on credit cards and their fun perks, so let’s get straight whether they’re worth your while.

Q: First, why do stores want their credit card in your hands?

• Retailers’ credit cards come with extra-perks to entice you to shop at with them. EX: Amazon’s card gives you 5% cash back on everything you buy on Amazon.com. If you end up spending $1000 a year, you probably won’t sneeze at getting $50 back in your pocket. This theoretically makes it more likely you shop there vs at Target.

• Your shopping using their credit card means valuable info on your buying habits! They see who their best customers are and can better target ads at their customers.

• Credit cards are a way for stores to make more money, not just through items you buy but by charging high APRs. Remember, APR is the % you pay if you’re late on a payment (which is naturally not the MoneyGirls way).

We demystify… Don’t confuse retailers’ Credit Cards with their Store Card. Credit cards can be used anywhere credit cards are accepted. Store cards are ONLY for use at THAT store. Know which kind you’d be signing up for.

Q: Do they affect my credit score differently?

Nope. Same everything applies to your credit score, whether you roll with a bank credit card or a specific store’s credit card. The main difference is retailers’ credit cards often have lower credit limits. See the Cons List below on why that’s no good.

Q: Tell it to me straight - are they good or bad?

Bottom line — Get a store credit card only if you can check both boxes:

🗓 200% sure you’re able to pay down the balance every month fully and on time - just like with ANY credit card.

🛍 It’s legitimately your favorite store where you spend the most.