When Does It Make Sense To Get A Store Credit Card?

A store credit card can either be a financial asset or a liability; depending on how you use it and when you decide to get one. Whether you’re new to store cards or just looking to try a different one, here is some helpful advice on when it makes sense to get a store card-and when it doesn’t.

When You’re New To Credit Building

If you’re new to the credit building world, a store credit card may be just the thing for boosting your credit quickly. Store cards traditionally feature higher interest rates but lower card limits, meaning you can only spend so much before the card is maxed out.

Not only does a low card limit promote spending discipline, but it also reduces the amount of potential debt you can incur once you start using your new card. The cap will make it easier for you to curb your spending habit while still being able to buy from your favorite retailer.

Make your payments on time (in a higher dollar amount than the minimum) to avoid late fees and keep your balance down, and you’ll find your credit score slowly begin to climb as you remain responsible with your new card.

When You Have Disposable Income

A credit card is nothing more than a high-interest loan, and a store card will have higher interest rates than traditional cards. So generally, if you’re struggling to meet your bills, opening a card of any type isn’t exactly the best financial practice.

If you’re opening a store card, chances are you have the extra money to spend there. You don’t want to open a card or borrow more than you can pay for, otherwise, you’ll find yourself in an even bigger debt bubble than you anticipated.

Keep your expenditure low and never max out your card. Always make payments on time and be sure of how much you can afford for the month before you buy anything with your card.

When You Want Exclusive Savings

There are many advantages to opening store cards that are store-specific. Cards like the Nordstrom credit card offer exclusive member discounts, access to special events and sales, and even extra services not offered to non-card holders.

If you’re a loyal shopper of a particular retail outlet, having a store card makes sense. You’ll save extra money in-store and have access to otherwise inaccessible resources and discounts that can drive your costs down.

Many store cards have a loyalty rewards program as well, allowing their card users to acquire points for certain dollar amounts spent (the number varies per card). These points can be redeemed when you reach a certain amount, usually for an in-store credit or voucher.

When You Have A Low Credit Score

Store cards are usually much easier to get approved for than traditional cards, making them a great resource for folks whose score could be a little better. You can utilize the easily approved store card to try and get your credit back on track.

It’s important to be wary when you open a store card, however. A low credit score can reflect poor financial decisions, so it’s essential that you remain aware of your limitations; both financially and mentally.

If you can’t resist the temptation of running up the card every month, you may want to avoid signing up for one. This will only serve to further damage your credit score when you start making late payments, reaching your limits, or can’t make the payments at all.

When You Need To Make A Large Purchase

Let’s say your washer and dryer finally died, or your refrigerator went out, or the little ones knocked over the flat screen. You’re going to need a replacement, and financing said replacement on a store card is one option to consider.

A store card may even offer deferred interest on the large purchase, meaning any interest on your purchase is deferred for the duration of the promotional period. While it’s uncommon for a store card to offer zero interest, it does occasionally happen.

After you’ve made your large purchase on your new store card, you can focus solely on paying off that one item. Put the card away for a few months while you pay it off. This can be very helpful when your appliances become outdated and you’re in dire need of a replacement.

Compare Rates Before Choosing A Card

Every card with come with its own interest rates, late fees, and annual fees. Before you choose a store card, pick a few of your favorite stores and compare these rates among them. Which one has no annual fee? The lower interest rate?

Always read the entire agreement when purchasing a credit card. Often you’ll find terms and conditions you wouldn’t have been aware of otherwise, and this way you can avoid any unlooked for charges or mistakes on your monthly statement. Never sign an agreement until you’ve read it in its entirety.


A store card can be an easy-to-obtain alternative to traditional credit cards, and while boasting higher interest rates, their generally lower spending limits can help keep your spending habits on track. Remember, always pay on time, and try to make more than the minimum payment so you don’t fall behind.

These are great cards for the beginner or those with low credit scores looking to build their credit back up.


Adam Hansen

Adam is a part time journalist, entrepreneur, investor and father.