There are many shops that have store cards and you may wonder whether it will be worth getting any. It is worth knowing how they work so that you are aware of the system and then you can make a decision about whether you think they will work out for you.
How do store cards work?
A store card works in a similar way to a credit card but instead of being able to spend it anywhere, you can only use it in the particular shop it is affiliated with. This means that You can use it to buy items in the shop and you will not need to pay for them until they send you a statement. This can be up to 6 weeks after purchase and then you will have the option of paying for the items, paying just a minimum amount or something in between the two. This means that you will get interest free credit until the card is due to be paid off. However, if you do not pay it in full, you will start to be charged interest on what you owe. This interest can be quite high, so it is worth being aware of how much it is and thinking about whether you want to pay it.
The store cards can open up opportunities for you too. Sometimes card holders get extra discounts, previews to sales and things like that. This can be really great if it is a store you shop in frequently as these discounts could help you to save a lot of money. Of course, we always need to be careful with discounts. This is because, we could find that we are buying things because they are reduced, rather than buying what we need or want and waiting to buy them until they are discounted. This second option is the one where you will save money the first option you will just spend money that you had not planned on spending.
Will they work for me?
Some people find the cards work really well for them. They use them to take advantage of the offers and the interest free credit. They pay the bills as soon as they arrive in full (or better still set up a direct debit so they never forget) and then they are able to use the cards to their advantage. If you think you will be able to do this, then the chances are that they will suit you really well.
However, some people find that because they have the card, they shop more often, buy things they do not need and do not pay it off so end up paying a lot of interest. It might stop people comparing prices between shops as they know they can pay in this one with their card so they may end up paying more than necessary for items. They also just might be tempted to go in the shop more often and get tempted to buy all sorts of things. The fact that it feels like we are not paying for the items can make it feel like we are shopping for free and so we feel like we This is not good as it means that having the card costs you money and you do not want this to happen.
So, think about what you are likely to be like if you have a card and this should help you to decide whether it will be a good decision for you to have one or not. It might be hard to tell really but you will need to think about whether you have had a card like this before and how it worked out. Also think about your attitude towards money and debt and how you might react when having a card.