Do you have a store card? Are you tempted to get one? Store cards are so-called because they are issued by a high street store – usually a big-name one. Some are attached to a group that operates several well-known high street stores. Maybe you have bought something in a store and been asked if you have one of their cards. If not, would you like to apply for one?
There are perks to getting these cards, but there are potential hazards lurking, too. The one thing to remember is only to get one if you fully intend to clear the balance each month. Interest rates on these are very high. Any great deal you get by purchasing something on a store card can easily be wiped out if you miss the payment and end up paying interest on it. This is particularly true if you miss the payment date and get charged a late fee as well.
So, how can you win with a store card? We’ve given you the answer already – only get one if you pay off your balance monthly before the due date. That’s it. There are no other loopholes or things you can do to minimise the damage that would be caused by paying any interest on a store card.
With that in mind, you might wonder what the point is of getting one to start with. Most store cards offer an introductory discount on purchases. It might be 10% or more, so if you are going to buy something anyway – particularly something expensive – you can save a fair chunk by making your purchase on a store card. Just make a note of the due date for the bill to be paid.
Store card members can also get other deals at times, such as special offers not available to regular shoppers. It’s only worth getting a store card for a store you use regularly. It means you can make the most of the deals whenever they arise. But again, you should make sure you are only buying things you were going to get anyway. Some shops also offer free home delivery for store card holders. This can amount to quite a bit over time if you tend to prefer home delivery and you order several times a year. Still more have points offers, where points mean you get discounts off future purchases.
The trick is to consider what you will get out of having a store card. Never have an outstanding balance on it, otherwise you’ll lose out financially. It could also hit your credit score. But if you find a deal for a shop you use a lot, it might just be worth getting a card to play them at their own game. That sounds harsh, but it’s true. Getting points, vouchers, or cash discounts for having a store card you pay off in full every month is a great idea – providing you do pay it off in full.