It is very easy to obtain a store card at just about every location when that store does offer a credit card to consumers. The offers may be made by the cashier and offer discounts on your purchases in addition to the convenience of shopping with a credit card at that store. In addition to being limited to where you shop, store cards carry a very high rate of interest if you are unable to pay off your outstanding balance before the expiry of the interest free period
If you already have several standard credit cards that are maxed to the limit, then obtaining a store card is not a viable option for you. It will only place greater financial strain on your already strapped resources and force you to make the minimum monthly payments on your account. With the high rates of interest charged on store cards, it will take you a very long time to pay off the amount you spend in this manner. Quite often the interest charged each month may be more than the required minimum payment, which will increase the amount of money that you owe. Even if it is lower than the payment, the difference is not likely to be very much
In order to avoid paying away most of your money on interest payments when you have an outstanding balance that you cannot pay off before the end of the interest free period, you should set a budget of how much money you can afford to spend this Christmas season. It is not just the cost of the gifts that you have to factor into this budget because Christmas means more food and clothing for entertaining guests as well as decorations for your home. Instead of just wandering around the store purchasing everything that catches your eye, plan your shopping experience based on the discounted items and the specific items you want to buy
Another of the pitfalls of using store cards is that when you have such a card you are more likely to visit that store more often and when you see an item you would like to have then you can readily buy it. It is very enticing to consumers to be able to shop in this manner and this is what has caused so many to find themselves in financial difficulty. They may not have the financial means to repay the full balance at the end of the month, which means they have no other option but to make the minimum payment
Store cards are a viable option for those who are unable to obtain a regular credit card that carries low or no interest charges. Many credit card companies are feeling the pinch in the current recession and are approving fewer cards for customers with lower credit ratings. It is a lot easier to obtain a store card right on location in the store. This makes them very enticing and while they are beneficial in helping you raise your credit score when you make your payments on time, they could end up costing you more money if you do not use them wisely
In order for a store card to be effective in helping you get over the added expense of Christmas, you should prepare a budget of how much you can afford to spend at this time of the year. Then when the statement comes in during January, you will not receive a shock at how much you have actually spent and then become stressed about how you are going to pay off the balance on the card.
Alisdair Cosgrove has been writing finance articles for many years and can find more of his work at the UK site CreditCardsWeb.co.uk, offering low interest credit cards for UK residents and also a great selection of interest free credit. Visit today to read more of Alisdair's great credit card articles.
