If you\u2019ve ever been shopping at a major retailer, you\u2019ve probably had a cashier offer to sign you up for a store credit card with the promise of saving you money on your purchase. These offers are hard to miss because most stores are trying to meet a quota of new credit card sign-ups, and cashiers are required to offer them to you. Some of the sign-up discounts can be pretty appealing, as can the regular rewards, but should you sign up for a store card just to get a discount? <\/p>\n\n\n\n\n\n\n\n
Some stores offer a percentage off your first purchase, typically 20% or 30%. Others may offer a flat rate discount off of a minimum purchase amount. <\/p>\n\n\n\n
For example, the Target Red Card comes with $40 off your first $40 or more purchase, upon card approval. Occasionally, store credit cards may offer a 0% APR introductory period in which all purchases made during that time can be paid back with zero interest. <\/p>\n\n\n\n
In addition to a sign-up bonus, store credit cards may also have a recurring reward program that offers incentives for regular purchases. Cashback for eligible purchases is a standard reward, as are point systems that convert into cash savings.<\/p>\n\n\n\n
For example, Walmart offers 5% cashback on any purchase made through the website or app, 2% in stores and 1% on purchases at other stores where Mastercard is accepted.<\/p>\n\n\n\n
One Time Discount<\/strong><\/p>\n\n\n\n Regular Rewards<\/strong><\/p>\n\n\n\n Probably not. There is no one-size-fits all answer, but in general, the amount you\u2019ll save opening one store credit card may not be worth everything you\u2019ll need to do to make sure the card doesn\u2019t cost you money in the long run. <\/p>\n\n\n\n Let\u2019s not forget that even if you aren\u2019t accepted for the store card, the hard inquiry required to apply can affect your credit! Count on your score, dropping a few points whether or not you are accepted for the card. If you have a solid score and haven\u2019t taken on new debt recently, losing a few points on your score might not be a big deal to you. <\/p>\n\n\n\n On the other hand, if you apply for lots of store cards in a short time frame, expect a more significant dent in your credit. We definitely don\u2019t recommend opening multiple store credit cards at the same time. This slippery slope can land you in hot water if you don\u2019t follow through with paying off each card in a timely fashion. <\/p>\n\n\n\n The benefits seldom outweigh the cost and headache of tracking down all of your accounts to resolve them after your shopping spree.\u00a0<\/strong><\/p>\n\n\n\n New credit lines also change the architecture of your credit profile. They lower your accounts\u2019 average age and give lenders the impression that you are an inexperienced borrower. Your credit lines\u2019 average age makes up 15% of your credit score in most scoring models.<\/p>\n\n\n\n When you are in a store making a purchase, the temptation to save money on all of the goodies you found can lead to an inflated sense of optimism about how you\u2019ll manage the new card when you get home. You probably think, \u201csaving 20% on my purchase today is a no brainer because i\u2019ll just pay it off right away!\u201d Unfortunately, that resolve weakens once you leave the store and are presented with distractions that can cause you to forget \u201cthe plan.\u201d This is especially true if you are in the midst of a busy holiday season. <\/p>\n\n\n\n\n
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Is Getting a Store Credit Card for a One Time Discount Worth It?<\/h2>\n\n\n\n
Applying for Store Credit Cards Affects your Credit Score<\/h2>\n\n\n\n
Store Credit Cards Test Your Follow Through<\/h2>\n\n\n\n