Image courtesy of Jason Baker

Many big chain stores will offer a store card to their customers. Some have loyalty cards but these are different and should not be confused with a store card. A store card is rather like a credit card where you can buy things on the card and not have to pay for them immediately. You will be able to wait until you get a bill to pay for what you have bought which could take up to six weeks. You will normally only have to pay a minimum balance of the interest and so you can choose not to pay for the goods immediately.

Although the cards sound great because they will allow you to be able to buy things when you do not have the money or delay paying, it is worth thinking about the cost of them. If you use a store card and do not pay off the full balance each month, you will have to pay interest on the money owed. This interest rate can be very high compared to other forms of borrowing and so you will be paying a premium for the convenience of not paying for the items right away.

Of course, if you do pay the card off every month in full, then you will be able to take advantage of the interest free credit. This will mean that you will be able to buy things and delay paying for them, getting the interest on the money yourself until it is time to pay them off. It is important to be self disciplined though and make sure that you really do always pay off the full balance, If you think that there is any chance that you will not be able to do this then it is wise to not get the card at all.

Store cards may also have other advantages. Sometimes card holders can get special deals and discounts or previews to sale evenings. This can mean that you could save money that you may not otherwise have done. However, you do need to be careful to make sure that you do not buy things that you would not normally have bought, just because they are on sale. You therefore need to be really careful what you use it for.

So whether taking out a store card is a good idea really depends on you. You will know whether you are the type of person that is likely to make the most of it or whether you are more likely to overspend and not pay it all off causing you to get into debt. This is not a good situation to be in. You may also find that you will be more likely to shop in that place because you have a card for it. This is what they are hoping but it means that you may be overpaying for things that you could get cheaper elsewhere, so be careful. You do not want to end up spending more than necessary.