Retailer credit cards can offer good savings - Lexington Herald

Retailer rewards credit cards are getting a whole lot more rewarding lately, with some offering 5 percent cash back on your purchases along with other goodies.

While getting something for nothing is a smart spender’s Holy Grail, credit cards can be a dicey proposition because of their punitive interest charges on unpaid balances. Get-out-of-debt guru Dave Ramsey never recommends getting a credit card no matter how good the rewards, often saying, “If you play with snakes, you’re going to get bit.”

Still, even Clark Howard, longtime critic of store cards, recently changed his mind. Howard, who doles out money advice on TV, radio and in books, said that despite his reservations, he’s intrigued by Target-branded cards that offer a 5 percent discount. “That 5 percent is a significant enough number to make me rethink my typical advice,” he told his radio listeners.

The main consideration when thinking about applying for a retailer-branded credit card is whether you will pay off the entire balance every month, said Farnoosh Torabi, author of the book Psych Yourself Rich: Get the Mindset and Discipline You Need to Build Your Financial Life and a money expert with Credit.com.

That’s especially true with retailer credit cards, because they tend to have very high finance charges, many exceeding 20 percent. And if a card has an annual fee, you need to make sure you’ll make back in rewards more than the card is costing you, she said.

Another consideration is the impact on your credit scores. Opening new lines of credit temporarily lowers your scores. “You’re sending the message to the credit bureaus that you suddenly need a lot of credit, and that factors in negatively in computing your credit score,” Torabi said. And many cards have low limits, meaning you will easily use a greater percentage of your available credit, another factor that harms credit scores.

Perhaps a bigger concern is that several studies show that consumers spend more money with credit cards than they do with cash.

Despite potential drawbacks, many consumers might benefit by using retailer cards from a store where they shop most.

Here’s a sampling of lucrative retailer-branded credit cards to fit a variety of shopping tastes. Helping to compile the list were Amber Stubbs, managing editor of Cardratings.com; Bill Hardekopf, founder of Lowcards.com; and Tim Chen, founder of Nerdwallet.com.

As a general rule, look for cards that pay greater than 2 percent back, which makes them better than a standard, general-purpose rewards credit card, Chen said.What some rewards cards offer

Target

If you shop at Target often, especially if you buy food and clothing there, it could be worth getting its store-only “REDcard.”

You’ll get a straight 5 percent off on all purchases, including at the pharmacy. Target’s debit card reaps the same benefits, but it can’t be used at the retailer’s Web site.

Lowe’s

The home-improvement store’s Lowe’s Consumer Credit Card also gives back a generous 5 percent. It has no fee, but its interest rate is very high, at 24.99 percent for new accounts. It is also a Lowe’s-only card.

Gap

Hardekopf said store cards often aren’t a good deal compared with the best traditional credit cards, but the Gap Visa card has some appealing features. It gives you a 10 percent discount on Tuesdays; five points for every $1 spent on company brands at Gap, Banana Republic, Old Navy, Piperlime and Athleta; one point for every dollar spent elsewhere; a $10 reward card for every 1,000 points accumulated; and it sends exclusive offers to cardholders.

Best Buy

The Reward Zone MasterCard gives back 4 percent on Best Buy purchases, 2 percent on dining and groceries and 1 percent on everything else. Cardholders who take advantage of Best Buy’s deferred interest deals should watch out for retroactive interest, Chen said. The annual fee depends on creditworthiness, and it ranges from nothing to $59.

Dillard’s

The department store’s American Express card provides 2 percent back at Dillard’s and for groceries and gas. It offers 1 percent on all other purchases. Get a 10 percent off all-day shopping pass every time you earn 1,500 points. Additional benefits for elite cardholders include free standard shipping from Dillards.com and free gift-wrap services.

BP

With this Visa card, you get back 5 percent at all BP locations. You get 2 percent on travel and dining, excluding fast food, and 1 percent elsewhere. Rebates are doubled for the first 60 days of owning the card. However, you’re limited to $25 per month in rewards on purchases earning a 5 percent rebate. So, you might use it mostly for gas purchases.

Amazon.com

This online-only department store’s Visa card gives 3 percent back on Amazon.com purchases, 2 percent at gas stations, restaurants and drugstores and 1 percent on everything else.

Article source: http://www.kentucky.com/2011/10/23/1931655/retailer-credit-cards-can-offer.html

Share

Leave a Reply


Other News

  • FEATURED

    Umthethwandaba Ophezulu Unquma Ukuthi Okhansila BeMDC Ekhokhelwa NguMnu …

    Umthethwandaba Ophezulu Unquma Ukuthi Okhansila BeMDC Ekhokhelwa NguMnu. Tsvangirai EHarare Aboxotshwayo Babuyele Emsebenzini Abane laba babalisa okhansila Paul Gorekore, Johnson Zaranyika, Maxwell Katsande, lo Silas Machete abamela amawadi aseMbare, Dzivarasekwa, le Tafara. Ngu Sithandekile Mhlanga | Washington Umthethwandaba ophezulu eHarare usunqume ukuthi okhansila abane balelidolobho abaxotshwa emsebenzini ngumphathintambo wezabelo uMnu. Ignatious Chombo ngomnyaka odluleyo babuyiselwe ezikhundleni zabo ngoba bengelacala. Abane laba babalisa okhansila Paul Gorekore, Johnson Zaranyika, Maxwell Katsande, lo Silas Machete abamela amawadi aseMbare, Dzivarasekwa, le Tafara. Kuviki edluleyo, [...]

    Read more →
  • FEATURED Indigenisation should not be political rhetoric

    Indigenisation should not be political rhetoric

    Morgan Tsvangirai Responding to questions from parliamentarians at the inaugural Prime Minister’s Question Time in Parliament today, Tsvangirai said the issue of indigenisation should not be based on political rhetoric, but should be based on one clear government policy. “The issue of indigenisation is of national concern. We need to promote not damage investment in the country,” He said. “The idea is not to share a small cake but to grow the cake that people are able to share. We [...]

    Read more →
  • FEATURED

    Air Zimbabwe trying to secure French planes amid sanctions

    Air Zimbabwe is reportedly struggling to register two airbus planes it bought from France because of European Union sanctions imposed on the southern African country. Details emerging from several Air Zimbabwe sources reveal that the planes were bought through China Sonangol, a Chinese controlled oil company based in Angola. Sonangol was reportedly roped in to circumvent the sanctions slapped on Zimbabwe in 2002. Aviation sources said Eads, the French aircraft manufacturer was the supplier of the planes. The sources said the [...]

    Read more →
  • FEATURED Registrar General faces court action after refusing Zim man passport

    Registrar General faces court action after refusing Zim man passport

    Registrar General, Tobaiwa Mudede By Alex Bell 26 October 2011 A Canadian based Zimbabwean man has taken ZANU PF’s Registrar General, Tobaiwa Mudede, to court over Mudede’s refusal to grant him a passport. Mudede’s office has refused to renew Sebastian Piroro’s Zimbabwean passport which expired last year, after the office discovered that his late father was born in Mozambique. According to the RG’s office although Piroro was born in Zimbabwe more than 40 years ago, the fact that his father [...]

    Read more →
  • FEATURED Zimbabwe PM Tsvangirai Attacked Over Gay Rights Remarks

    Zimbabwe PM Tsvangirai Attacked Over Gay Rights Remarks

    Zimbabwe PM Morgan Tsvangirai was hammered by members of his own party for comments he made to the BBC this week in support of constitutional protections for gay people, Zimbabwe Metro reports: Justice Minister Patrick Chinamasa claimed Tsvangirai’s call was dishonest, insisting: “I know personally he doesn’t believe it. He has said so many times in the Cabinet.” Tsvangirai’s MDC-T party refused to back him, and his spokesman appeared to beat a retreat, suggesting that the Prime Minister’s position expressed [...]

    Read more →
  • FEATURED Zimbabwean Lydia Werrit granted three more years in UK

    Zimbabwean Lydia Werrit granted three more years in UK

    26 October 2011 Last updated at 09:49 ET Lydia Werrit fled Zimbabwe when Mugabe supporters seized her farm An 88-year-old Zimbabwean woman living in Kent who was facing deportation has won a three-year reprieve. Lydia Werrit has been living in Hythe with her family since supporters of Robert Mugabe seized her farm in 2003. A UK Border Agency spokesperson said: “Given the special circumstances, we have decided to grant three years’ discretionary leave to remain.” Ms Werrit’s daughter Sophie Laubscher [...]

    Read more →
  • FEATURED Zimbabwe foreign minister urges reform of U.N. Security Council

    Zimbabwe foreign minister urges reform of U.N. Security Council

    Harare, Zimbabwe (CNN) — Zimbabwe’s foreign minister is calling for reform of the United Nations Security Council following the “extrajudicial” killing of Libyan leader Moammar Gadhafi. NATO’s role in Libya highlights the need for more democracy and accountability, Simbarashe Mumbengegwi said late Tuesday at a celebration to mark the anniversary of the United Nations. Gadhafi’s “brutal extrajudicial killing” shows the Security Council is not accountable to member states of the U.N. General Assembly , he said. The former leader was [...]

    Read more →
  • FEATURED

    Switzerland Denies Mugabe Entourage Visas

    Zimbabwe President Robert Mugabe has canceled plans to attend a United Nations meeting in Switzerland this week after his wife and five aides were denied visas. State media on Wednesday quoted an unnamed foreign affairs official who called Switzerland’s decision on the visas “highly regrettable.” The official accused Switzerland of violating the U.N. host agreement and Zimbabwe’s right to select its own delegation. The Swiss Embassy in Harare has declined to comment. The European Union and the United States have [...]

    Read more →