Of course, what Is APR for Retail Credit Cards and how it works? That favorite retail store credit card may offer one all manner of great perks, bonuses, and coupons. But do you really know how much your retail credit card interest rate? APR means the Purchase Annual Percentage rate. It is the rate added to your outstanding balance each month on your credit card.
What Is the Average Retail Credit Cards (APR)
Generally, retail credit cards average APR falls on 25.64%, from a new report found. This rate is nearly 5% more than the average overall credit card APR of 20.82%, therefore making the retail store’s cards, not a good deal. Consumer report reveals that a lot of people sign up for a retail store card at checkout without being aware. It is then important to watch out for retail store cards. Consumers reports reveal that many retail credit cards offer what is called “Special financing”, Which is bill as no-interest financing for a certain period of time. But if the balance is not fully paid off within that promotional period, you’ll be charged retroactive interest on the purchase price.
Are Retail Credit Cards A Good Idea?
It is advisable to avoid retail credit cards all the same. With few exceptions; Retail credit cards help to build your credit scores, but they usually have a lower credit limit than other cards. Pick cards from your regular stores where you shop frequently. Their charges are a small amount, and you pay the balance in full each month to avoid the high-interest.
However, a Credit card can be a great tool if used correctly, retail stores cards are not an ideal card. Rather than traditional, low APR, no-fee credit cards are good for you. If you want a reward in your card, go for rewards, cash back, or travel rewards credit cards. With these cards, you will get similar perks to a retail store credit card but with lesser risk.
Store Card What to Consider Before Getting it
Below are listed what to put into consideration before getting a retail credit card:
- Check out the parameters of any special financing deals and see if you’ll have to pay huge interest. When you have not paid off your entire balance within the promotional period.
- Be careful about a retail store card, be sure that you read the fine print. Find out details about any special financing, promotional interest rates, or fees.
- Avoid overspend on your credit card, always leave it at home or hid it.
- To build credit try using your card to pay one bill a month through direct debit. You can also set up an automatic transfer from your checking account to your credit card bill a few days later
- Only sign up for retail if it’s at a store you shop frequently. Be careful not to be tempted to open a card at the last minute offers just to save 15% on your purchase. In most cases, the 25% interest rate on the card will cost you more than the 15% in your savings.
- Taking a reward or cash back credit card is more convenient instead of a retail credit card
- Do not sign up for a retail credit card if you already have credit card debt. Rather work on the debt to pay off plan first. You may also think of transferring your balance to a zero or low APR card.