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7 Store Credit Cards That Are Actually Worth Getting

0% financing for 6 months! Save 15% off your purchase right now!

We’re sure you’ve had your fair share of store credit card offers as a cashier rings up your purchases at the mall.

But which offers will actually reward your loyalty with real savings? And which are only out to collect all those high interest fees?

Read on to learn the ropes of reward credit cards – including the 7 accounts actually worth opening.

What to Know About Your Store Credit Card

Store credit cards are tricky – especially if you have bad credit.

(In fact, we’re going to be straight with you: if you have a less-than-stellar track record with credit cards, reconsider opening a store account now).

Still, if you’re a regular shopper at big retailers like Amazon, Target, or Lowe’s, it might be worth signing up to get deals, discounts, or even cash back on your purchases.

Here’s what you need to remember before you apply.

1. Say Hello to High Interest

Cashing in on these high-interest rewards cards only makes sense if you’re able to pay your balance off in full every month.

Otherwise, you’ll be stuck paying off your balance, plus anywhere from 15% to 25% interest. Ouch.

According to finance reporter Tim Chen, these high interest rates are related to how easy it is to open a line of credit through a store.

“Store credit card issuers as a whole have taken flak from the Fed over the past couple of years because of the way they instantaneously approve consumers at the register, rather than truly evaluating their credit and the likelihood that they will be able to pay back their debt,” reports Chen at Forbes.

If you’re not careful, you could wind up paying back way more than you borrowed – in fact, that’s what stores are counting on.

It’s important to keep these potential new payments in mind as you’re working up your budget for the next month or year.

What’s your track record like with your regular credit card? What kind of payments do you already make every month? How will your budget change if you have to add another payment into the mix?

The clearer the picture you have of your monthly expenses, the easier it will be to see whether a store credit card will impact your finances – or your credit score.

2. Know Your Limits

Although store credit cards offer tempting rewards, they also tend to curb spending with high interest rates and low credit limits.

“Because [store credit cards] typically have lower credit limits (around $1,000 tops), it’s easier to max them out, which will drop your credit score,” writes Emily Nickerson at The Muse, a career and financial advice website.

Remember: your credit score factors into your ratio of debt to available credit. That means if you’re only using a store credit card and maxing it out every month, your debt-to-credit ratio is going to look pretty unappealing.

Use a store credit card as a second credit card, however, and you might get a better credit score – but only if you can handle making all the payments.

3. Finding Flexibility

Most store credit cards are designed to keep you shopping at a particular retailer. For example, when you open a Target REDcard, that card is only good at Target.

This is called a “closed loop” policy, while store cards that allow you to shop at other retailers have what is called an “open loop” policy.

Even if you feel good about supporting a particular retailer, you should also read your offer carefully to make sure the reward actually is worth it.

“If you don't spend a lot of money in a particular store every year, you might find that you don't earn much in rewards,” explain the editors of Consumer Reports.

“For example, Macy's credit card holders who spend $500 to $999 per year get 1.5 percent cash back on Macy's purchases, but those who spend $1,000 or more earn 3 percent rewards on Macy's purchases plus access to a priority customer-service phone line,” the editors add.

Based on your past spending habits, will you fulfill the terms of your deal to cash in on the card’s rewards?

Weigh your options carefully before signing on the dotted line.

7 Store Credit Cards You Should Consider

Now that you know what to expect, here are 7 cards with good deals, lower-than-average APRs, and plenty of rewards.

1. Costco Anywhere Visa

Can’t get enough of Costco’s savings? Then hold onto your hat!

The Costco Anywhere Visa credit card offers multiple cash-back discounts on common purchases, including gas, restaurants, travel, and Costco items.

Because this is an “open-loop” card, you’ll get much more flexibility in your spending – but you do have to purchase a Costco membership to be eligible.

APR: 0% for the first 6 months, and 15.99% thereafter

Rewards: 4% cash back on gas, 3% cash back on restaurants, 2% cash back on Costco items, and 1% cash back on everything else.

Annual Fee: $0 (or $55, the price of a Costco membership)

2. Target REDcard

One of America’s most popular retailers, Target offers its REDcard customers 5% back on purchases, free online shipping, and extra flexibility for returning items.

Already a loyal Target shopper with a steady income? This is a great option for cheaper groceries, household items, and the occasional wardrobe upgrade.

But beware: there’s no 0% financing grace period here. You have to start paying back as soon as you open your account, or you’ll be subject to high interest rates.

APR: 23.4%

Rewards: 5% back, free online shipping, 30 extra days to return unwanted items.

Annual Fee: $0

3. Amazon Prime

If you’re already an Amazon Prime member, you understand the allure of 2-day shipping and access to original TV series, movies, and music.

The Amazon Prime card, only available to Prime members, offers an additional 5% back on the purchases you make using your membership (not bad).

If you’re able to pay off the balance every month, you could see nice returns on the stuff you’d buy anyway.

APR: 26.24%

Rewards: 5% back on purchases made at Amazon and a 0% financing offer for the first 6 months.

Annual Fee: $0 (or $99, since that’s the annual cost for Prime membership)

4. Lowe’s Consumer Credit

If your obsession with HGTV has translated into feverish DIY home makeovers, the Lowe’s Consumer credit card might be for you.

This card offers 5% off purchases and flexibility in claiming your rewards. If you’d rather have a line of credit, you can forego the 5% discount for 0% financing.

APR: 26.99%

Rewards: 10% off your first purchase, and 5% off purchases after that – or 0% financing.

Annual Fee: $0

5. L.L. Bean Visa

Stock up on parkas, waterproof boots, and backpacks for the whole family with the L.L. Bean credit card.

This card offers a lower interest rate than other cards and flexibility to shop at other stores and still earn rewards.

If you need new outerwear or are an avid lover of the outdoors, this card could actually be a good deal. Rewards come in L.L. Beans coupons, rather than cash back or discounts.

APR: 13.99%

Rewards: Take 15% off your first purchase at L.L. Bean and earn 3% towards future purchases. All other purchases earn you 1%. Free shipping on returns and free monograms.

Annual Fee: $0

6. Blue Cash Preferred from American Express

The American Express Blue Cash Preferred isn’t a store credit card per se, but it is closely linked to your everyday purchases.

According to NerdWallet, you can get 6% rewards on supermarket purchases – that’s money in the bank, just for buying groceries.

With an “open loop” policy, the card will give you more flexibility for your spending habits than one tethered to a specific retailer.

APR: Variable

Rewards: 10% cash back on restaurant purchases for 6 months, 6% on supermarket purchases, 3% on gas, and 1% on other items.

Annual Fee: $95

7. Chase Sapphire Preferred

Like the Blue Cash Preferred card, Chase Sapphire Preferred is a rewards card that works best for specific spenders. And if you spend half your life on an airplane for business travel, this could be the card for you.

Rewards here come in the form of points: 2 points for every $1 spent on dining out and travel costs, and 1 point for every $1 spent on other items.

Soon enough you could earn enough points to start booking flights for free.

APR: 16.49%

Rewards: Double points for travel and dining, points for all purchases, and relatively good deals when you redeem points for airfare miles.

Annual Fee: $0 for your first year; $95 for every year thereafter

Whether you need a card with a little bit more flexibility, or a store card from the retailers where you spend the most cash, make sure you know the ins and outs of your agreement.

If you can pay the card off in full every month to avoid high interest rates, you’ll save big on the items that always stay on your shopping list.

Happy hunting!

What’s the best credit card offer you’ve ever jumped at? Tell us about your favorite rewards in the comments below:

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