How many times have you found yourself in Sears (or in any store!) with the cashier asking you to apply for their store credit card in order to save 10-15%? It seems like every store has their own credit card these days and it’s nearly impossible to shop without being asked to apply for their credit card.
Once the largest retailer in America, Sears is no different when it comes to offering credit cards. They give the same benefits for applying for their cards:
– Exclusive savings and coupons
– Special financing offers
– $0 liability on unauthorized purchases
But are these good reasons to apply to the SearsCard? What you don’t see is the fine print behind the card itself, which includes the biggest: the interest rate.
The interest rate on the SearsCard can vary depending on your credit score, but can range from 17% – 22% according to the Sears representative I spoke with recently. 17% is outrageous!
The card, which is proviced by Citi, is often promoted as a convenient way to make purchases while getting great discounts, but at 17% or more for the interest rate, the savings you might get are overshadowed by the interest rate that you’ll be paying on your purchase. The entire design of a store credit card is to get you to buy items without feeling the financial impact right away with the hopes that you’ll actually buy more with the card. The company will make a lot of money through financing your purchase and the discounts you receive won’t come close to the interest you’ll be paying on the card.
If you’re looking to have a credit card that actually makes sense, look at our suggested rewards credit cards. You’ll actually be earning points that you can use for hotel stays, airlines and cash back. Of course, the best money tips is to never use a credit card to buy more than you budgeted for, so make sure you follow this rule no matter what card you choose.
Have you ever accepted a store’s credit card for a deal?