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Get A Store-Branded Credit Card

It’s been a while since I’ve written a Devil’s Advocate [3] post and my recent article about five accounts you should have [4] (and four you should skip) listed a store-branded credit card as one of the cards you should skip, much to the chagrin of commenters. So, below are some excellent reasons why you would want to have a store branded credit card.

Special Offers and Coupons:
This is the number one reason why you should get a store-branded credit card – the special offers and mailings you get for being a card holder. If you loyally shop at one store, say a Macy’s or a JC Penney’s, it would make sense for you to get the credit card because they do frequently (not just occasionally, they frequently) send you coupons for percents off (10-20%) as a way of drawing you back into the store. If you love shopping at Victoria’s Secret, getting their card also gets you coupons for great discounts as well (sign up for their catalog too, they send coupons for free underwear from time to time).

Are these special offers worth getting the card? If you don’t go on a credit application binge, you’ll likely be alright and the added credit line will boost your score as well in the long run. Also, is the card worth giving up the reward points? Not if you only spend it at the store and not if you use it only for special sales, 10% off is better than 1% cashback anyday.

Easier Credit To Obtain:
If you have absolutely no credit history, it’ll be tough to get an unsecured credit card. Your only two choices are to try a student card (if you’re a student) like a Citi mtvU card [5], where they have no expectation of a credit history, or start with a store-branded credit card. Store-branded credit cards generally are easier on their credit history requirements because they offer lower limits and they want to make it easier for you to get the card (and spend money at their stores). So, if you have no credit and haven’t had success being approved for it with conventional unsecured credit cards, a store-branded card is your best alternative.

Immediate Discount:
I’m talking about the “10% or 15% off your purchase today” offers you see in practically every store. 10% off is still 10% off, while you might take a small credit score ding for the credit pull, money in your pocket now is better than an illusory money maybe taken out of your pocket sometime in the future. If you’re making a $1,000 purchase, 10% is a healthy $100 difference and that’s not trivial.

Are there any other good reasons for signing up for a store-branded credit card that I may have missed?