We’re all intimately familiar with the credit cards offered by specific retailers. Usually as you go to pay for your purchases the cashier will offer you an enticing discount if you apply for their credit card. In some cases that discount might be generous enough to have you sign on the dotted line, but what happens after that?
Retailers want your business, and companies of all kinds offer their own version of branded cards, most of them designated for use only at their specific store or its affiliates. If you make numerous purchases from one retailer it might make sense to use their card, but there can be drawbacks as well.
Store credit cards often come with high interest rates, and as many of them are not linked to major credit card companies like Visa or MasterCard, they can only be used within in the confines of the company who issued the card.
If you’re thinking of opening an account with your favorite retailer, here is some more information to help you decide which card is right for you.
Affiliate Branded Cards
When choosing a store credit card it’s usually best to ensure that the card is affiliated with a company like Visa and bears the company logo. Thesecards work doubly well as you’ll be able gain rewards points when you shop at your favorite retailer and you can use the card at any other places that branded card is accepted.
For instance, if you shop frequently at Gap or Old Navy their Visa card might be a good option. You’ll receive 5 points per dollar on all purchases which can be redeemed for store credit, and you receive one point for purchases at other retailers.
Most store credit cards have really high interest rates so if you decide to get one, avoid carrying a balance from month to month.
Victoria’s Secret
As far as the branded cards go, the offer from Victoria’s Secret is the perfect card for those who like lingerie and like discounts. This card is not affiliated with Visa or Mastercard so it can only be used in their stores, but the promotional offers associated with the card are pretty good.
For instance, customers who spend over $250 a year in the store receive VIP status and then get a flat 4 percent discount on all purchases after that. This Victoria’s Secret card charges no annual fee.
Target
While this card can only be used at Target stores and their online outlet, it comes with some very attractive benefits if Target is your go-to place to shop. You’ll receive 5 percent off every purchase which can be combined with Target’s coupons, and this will add up very quickly if you shop for groceries at Target.
You’ll also receive free shipping on online purchases, and an extra 30 days in which to make returns. The interest rate on this card is a bit high at 22.9 percent, but it’s still one of the best choices in a store credit card.
Bloomingdale’s
If Bloomingdale’s is your preferred shop for clothing, cosmetics, and gifts then their store card might be perfect for you. It is not affiliated with Visa or MasterCard but it does offer some attractive in-house rewards that can add up quickly if you shop there frequently.
You’ll receive three points for every dollar you spend on the card, and double points for purchases of cosmetics and perfumes. Once you attain 5,000 points you’ll receive a $25 gift card. These rewards might not seem like much, but if you shop at Bloomingdale’s frequently, especially during the holiday season, the rewards could be worth it.
Amazon
Everyone shops at Amazon these days, and the Amazon Visa card is a great choice for those shoppers. It has an attractive rewards program which gives you 3 points per dollar spent on Amazon, two points for purchases at restaurants and gas station, and one point for purchases made anywhere else.
You can redeem your points on Amazon, or you can take cash back or apply the points to travel. This card is one of the best of the retailer offered cards.
Store cards can be difficult as they often have high interest rates and limited locations for use. However, if you choose wisely and pick the card that you’re likely to use that also comes with good rewards, a store credit card can be a very good asset to your wallet.
