How to Evaluate Store Credit Cards

Store credit cards can be a blessings and a curse. If you use the store credit card wisely, it can be a big help in your everyday budgeting. However, if you carry a balance on the store credit card you can get yourself into even more debt than you are able to handle. Therefore, evaluate the pros and cons of a store credit card before you apply for one.

Instructions

1. Find out the interest rates the store charges to use their store credit card. Most stores have higher rates than bank credit cards, so you must use them wisely in order to benefit from a store credit card. If you're shopping in a store weekly, it can be beneficial to get the store credit card. This way you can put your purchases on the credit card and as long as you pay it in full at the end of the cycle, you will not have to pay interest.

2. Look into the offers that store credit cards have. Stores such as Circuit City and Home Depot don't charge you interest if you pay the loan in a certain amount of time. Understand the terms and figure out the amount you'll need to pay monthly in order to pay off the balance before the interest starts.

3. Evaluate each store credit card. Never fill out credit card applications until you evaluate the store's credit card. Even if you know you are going to pay the amount at the end of the billing cycle, you should be careful about starting a new credit card. Store credit cards can impact your credit and you want to keep your credit report as clean as possible.

4. Apply for store credit cards that offer you something in return. If you can get 0 percent interest or cash back for merchandise bought, the card may be worthwhile, but not all stores give you anything for using their card. However, Target doesn't charge an annual fee and gives you a 10 percent off shopping day for purchasing so much on their credit card and Wal-Mart has no annual fee and gives you gas savings at their gas stations.