The perks of a retail credit card may sound great at the checkout counter, but here are some things to consider that could cancel out any savings
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00:00When a store clerk asks, would you like 20% off your purchase, it seems like a no-brainer,
00:07right?
00:08But while the perks of a store credit card sound great, consider these things first.
00:14Bad credit?
00:15Store cards are easier to qualify for, so a good way to dig out of a credit ditch.
00:19But the discounts and rewards usually come with high interest rates, nearly 10% higher
00:25than the average credit card, according to U.S. News & World Report.
00:28They usually have lower credit limits, too, and reaching 30% or more of a credit card's
00:33limit is usually a red flag for lenders, so you've got to keep your balance in check.
00:39The sales-savvy cashier also won't lay out the fine print, so watch out for deferred
00:44interest offers, which means if you don't pay off your entire balance before the interest-free
00:49window's up, you owe interest on everything charged during that period.
00:56Lastly, consider whether the store is offering a closed or open-loop card.
01:01Open-loop cards are usually Visa or MasterCards and can be used anywhere.
01:05Closed-loop cards can only be used at the store you got it, so unless you shop there
01:09often, the card may just gather dust in your wallet.