The Advantages and Disadvantages of Using Department Store Credit Cards
by:
Court Tuttle
Department store credit cards are widely used in our world today. They allow you to buy things from a particular store that you normally would not be able to get. Getting a department store credit card is actually quite simple.
It is much easier than getting a regular credit card, and you are allowed credit that you normally may not have qualified for. Still, is it really worth it?
Should you really get a department store card, or would it be better if you just used a regular credit card? Here are a few pros and cons of having a credit card designed for a specific store.
Disadvantages
High Credit limits
Having several department store cards with limits that you think are not very high can actually add up to be quite a bit. Having even small amounts on your department store credit limits becomes one large limit, which can make it difficult to get a major credit card. Having such a high credit
limit because of your combined department store cards ties up your credit line and only allows you a small amount in which you can add another credit card.
No Rewards
Department store credit cards are more dangerous than they are useful when they do not give you something back for what you buy. Just being able to buy it on credit is not worth it, and can get you into financial trouble that you do not need.
Get a card that allows you to save money on the products that you buy, and keep only those cards. Once you pay them off, don't keep them. Having these cards will tie up your credit line and make other cards difficult to acquire.
High Interest Rates
Some department store cards have high interest rates that end up costing you more than you bargained for. Sometimes even the rewards do not make up for the money you spend on interest just to get these cards. Making late payments on these will also allow department stores to shoot your rates sky high, so you have to pay on time, or the card will be more of a burden than an advantage.
Advantages
Free Stuff
Some department stores allow you to receive free amenities when you use your card to buy things online or from a magazine. Services such as shipping and handling and/or free gifts sometimes come with your purchases when you buy an item from a store with its credit card. This can be bought on the internet, over the phone, and through magazines, all being delivered by mail to your home.
Rewards
Buying things from a department store using the card specifically designed to use at those particular stores can sometimes save you money. Depending on the department store, you may be able to get a certain percentage, or a certain amount of money back for a certain amount that you spend on a purchase. In this aspect, it is much like a rewards card, though it is only limited to purchases and savings within that particular department store.
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