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? asked in Business & FinanceCredit · 1 week ago

Why should you never get store credit cards?

2 Answers

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  • Anonymous
    1 week ago

    Actually, some store credit cards are fine.  You just need to pay attention to the terms of the card.

    There are advantages and disadvantages to store credit cards.  

    Some disadvantages:  They often have higher interest rates.  They sometimes have annual fees.   They are designed to automatically close if you don't use them often enough.  (a card that closes hurts your credit score - so forcing you to use their card means you must buy something from their store to keep your card open and avoid hurting your credit score)

    Some advantages:  Some store cards offer discounts for using their card for the purchase you make.  If you can pay the card off right away after using it, these savings can be substantial and you would avoid the interest charges by paying it off within the first billing statement.  Some cards also offer "no interest" on new purchases for a certain amount of time.  (of course, this is another way to get you to use their card for things you can't afford, but if you combine a "no interest" time frame with a great savings offer, you can get more merchandise for a lower price and still not pay interest on your card if you pay it off fast enough)

    If you are only going to get one or two credit cards, then you should avoid a store card and get only a VISA or MasterCard that can be used almost anyplace.  Store cards aren't much help if you need something from a different store and you are a little short on cash.  (one main thing I use my cards for is major auto repairs.  I never have to worry about how to afford an unexpected auto repair.  I just use my card and then pay it off as quickly as possible.)

  • 1 week ago

    I don't know that you shouldn't.

    If you have no credit, it can be a good first card, for a store you shop at every couple of months. You make your purchases, you pay in full, and you're building good credit history.

    Some department stores also offer special discounts and sales only to people paying with their own credit card.

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