Should You Get a Store Credit Card?

It can be tempting to save 10% or even 20% at the checkout by opening a retail store credit card. But should you? 

Laura Adams, MBA
1-minute read

While out shopping, you'll probably be pitched about opening up a store credit card. It can be tempting to save a chunk of change at the checkout by simply filling out an application. Here are 5 tips to help you know when getting a retail card is a smart move:

  • You're trying to build credit. Responsible use of a retail store card can be a good tool to help you build credit if you've been turned down for a regular credit card.

  • You're a frequent shopper at the store. You can get rewards, discounts, promotional offers, invitations to exclusive sales, and other perks when you make purchases using a store's retail card.

  • You can pay balances in full. Retail cards have notoriously high interest rates--so you should never carry a balance on one from month to month.

  • You haven't applied for other cards. Applying for multiple credit accounts at the same time will lower your credit score because they're hard inquiries on your credit report.

  • You're buying a big-ticket item. Saving 10% or getting interest-free financing for an expensive item like electronics or furniture may justify opening a retail card. Just don't get trapped into paying more than you can afford. If you don't pay the account off in full before the cut-off date, interest charges will start to accrue and you'll be looking at a hefty monthly charge.

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About the Author

Laura Adams, MBA

Laura Adams received an MBA from the University of Florida. She's an award-winning personal finance author, speaker, and consumer advocate who is a frequent, trusted source for the national media. Money-Smart Solopreneur: A Personal Finance System for Freelancers, Entrepreneurs, and Side-Hustlers is her newest title. Laura's previous book, Debt-Free Blueprint: How to Get Out of Debt and Build a Financial Life You Love, was an Amazon #1 New Release. Do you have a money question? Call the Money Girl listener line at 302-364-0308. Your question could be featured on the show.