Friday, August 11, 2017

Are Store Credit Cards Really Worth It?

Today, many stores offer store credit cards. At times, a special offer can come with signing up for one. The temptation is definitely out there, but as a bank at the Lake of the Ozarks, we feel you should know the pros and cons of getting a store credit card before you make the decision to do so.

Store Credit Card Pros

  • Store credit cards can be easier to qualify for.

The application requirements are less strict with store credit cards versus a regular credit card. You have a better chance of getting approved.

  • Helps build credit.

If you are still trying to build up your credit, store credit cards can be a great way of doing that. Experts recommend purchasing something at least once or twice a month. It's best to keep the total below 10 percent of your credit limit.  Then, you pay it off on time and in full every month to build up your credit and boost your credit score. 

  • Discounts and incentives can be provided.
Typically, stores will entice you to open a credit card by offering a discount or some other store perk. We recommend you wait until you are making a larger store purchase, this way you get the bigger discount!

Store Credit Card Cons

  • There can be high-interest rates involved.
Pay attention to the interest rates on store credit cards. Spend responsibly, while these cards can be easy to get, the interest rates can be high. 

  • Store credit cards can impact your credit score.
Please note that every time you apply for a credit card, your credit score takes a small hit. It's not a huge issue since most people will build their credit back up while using the card. Knowing this,  we would just recommend not an opening several store credit cards over a short period of time. Also, if you are planning on applying for a mortgage, you may want to hold off on opening any new lines of credit.

  • The temptation is rough.

The most difficult part of having store credit card is the temptation you have of now buying more things because you now have this discount associated with the card. 

Do You Have Questions About Your Credit?

If so, please don't hesitate to stop into First Bank of the Lake. Our friendly banking staff at the Lake of the Ozarks is happy to answer any questions you may have. Opening a new credit card for the first time can be a big deal and we are here for any financial advice you may need. With our overall banking experience, we are honored to help guide you in the right direction.

Want More Awesome Finance Tips? Sign Up For Our Newsletter!

First Bank of the Lake - Striving For Excellence
Member FDIC. Equal Housing Lender.

Located at the entrance to the Osage Beach Premium Outlets!

4558 Osage Beach Parkway

Suite 100
Osage Beach, MO 65065

(573) 348-2265

No comments:

Post a Comment