The dangers of store credit cards (and how I got suckered into opening a store credit card)

When I was a freshman in college, I did two very bad things (ahem — two bad things related to personal finance).

Bad Thing #1

First, I opened a VISA credit card. There was a guy at a booth on campus, and being too naive and timid to tell him to buzz off, I stopped and listened to his pitch. Next thing I knew I was filling out an application. At 18 years old, with no job, steady income, or credit history, I now had a $1,000 credit line. I maxed it out in less than three months and was shocked when the bill arrived.

Luckily, I was about to start a part-time job, so I was comforted in knowing I could handle this predicament myself. I paid down the balance — but then charged it up again. This cycle went on for years. I always paid more than the minimum, but never fully paid off the debt.

Bad Thing #2

The second very bad thing I did was open a store credit card with a major retailer. I was about to pay for my purchase (with the aforementioned VISA, of course), and the salesperson told me I could save money and receive special offers and free items just for signing up for a card. I demurred, but she was persistent. “You can pay it off as soon as you get home and still get the coupons and discounts,” she said. “That’s what I do.”

Unfortunately, it didn’t work out that way for me. I forgot I’d opened the card, somehow missed the first bill, and then was late with my payment. I was almost three months delinquent before I paid off the card, and I got a mark on my credit report, all for a small balance I could have easily covered with money in my bank account.

The Cost of Store Credit Cards

Cashiers are often required to ask customers to sign up for store credit, and some stores require them to meet a quota for new card sign-ups. But these days, I politely tell the cashier, “I don’t carry store credit cards.” If they persist, I repeat myself. “Don’t you want to save 10%?” No thank you, I’d rather not.

A recent study from New York Representative Anthony Weiner’s office provides even more reason to avoid store branded cards. The study found that 35 major New York City stores had an average interest rate of 23.83% on store cards (the national average APR for a regular credit card is 14.78%). Which stores offered the worst rates?

  • Radio Shack was the highest with a 28.99% APR.
  • Best Buy and Staples both charge 27.99% interest rates.
  • Home Depot charged 25.99%.
  • Sears came in at a hefty 25.24%.

In addition, the report found that store cards use a series of “teaser” deals to entice shoppers to take the bait, such as offering 0% interest, but neglecting to mention you have pay off the balance within a certain time period or else the interest rate is applied retroactively on the initial purchase price.

How I Got Suckered into Opening a Store Credit Card

Well, despite knowing all this, here’s the story of how I got suckered into opening a store credit card and what I learned from it.

It was the best of experiences, it was the worst of experiences…
Last week, I ventured into Neiman Marcus for the first time. It was the only in-person store that carried the Stuff I wanted, so I drove out of my way to go there. The salesperson who helped me was probably one of the best I’ve ever encountered. She knew I wasn’t spending much — about $60 — but she spent a considerable about of time helping me. She was friendly, extremely knowledgeable, and showed me other products she thought I’d like without pushing me to buy more. Instead, she offered to send me home with samples of her additional recommendations. As she put everything into a bag, the second salesperson helped to start the check-out process, which went something like this:

Salesperson #2: Do you want to put this on your Neiman’s charge card?

Me: No, I don’t carry store credit cards. (I hand her my MasterCard.)

Salesperson #2: We don’t take MasterCard, but it takes just a few minutes to open a store account.

Me: No thanks, I don’t open store cards. Can I put it on a Visa debit card?

Salesperson #2: We don’t take Visa, either.

Me: If you don’t take Visa or MasterCard, what do you take?

Salesperson #2: We take the Neiman’s card, American Express, cash, and checks.

I didn’t have enough cash on me, I don’t carry checks, and I don’t have an American Express card. The first salesperson seemed too uncomfortable to push me into opening an account, so salesperson #2 continued with the pitch, telling me most of what I knew already — that I won’t have to pay interest if I pay my balance each month and that the card comes with all kinds of “fabulous” rewards. She also told me that Neiman’s will never sell my personal information (this, of course, turns out to be false).

The Lowdown on Neiman’s

I found out later that Neiman’s does take Visa and MasterCard, but only for online purchases. It’s even willing to temporarily relax its rules during Super Bowl XLV “to make it easier for customers visiting from out of town…or from cities that don’t have a Neiman Marcus store.” Gee, how thoughtful!

According to Slate, the private-label credit card corner was one one of the most desired parts of the business when it sold during a 2005 auction (HSBC purchased the credit card portfolio in mid-2005 for $640 million.) At the time, there were 562,000 active users paying 15% APR — generating about $550 million in receivables for the company.

I knew store credit was big business, but I’d never encountered a store that doesn’t accept major credit cards to push customers into opening a store credit line.

Under Pressure

Back to my in-store experience: I was feeling cornered and conned. My first thought was to walk away. Now that I knew exactly what I needed, I could purchase the item from another retailer online.

But here’s the thing: I wouldn’t know what to buy if it hadn’t been for salesperson #1, the person who spent a lot of time helping me even though she knew I wasn’t spending much money. She more than earned her commission, and I felt bad about walking out. There weren’t any ATMs nearby, and I had an appointment in about 15 minutes. I was feeling pressured. On the other hand, I was mad and felt as though I’d walked into a trap.

I caved, and I opened the account to make the purchase. But I’m calling Neiman Marcus to pay the balance and cancel the card.

I know Neiman’s won’t miss my business — I’m hardly their target customer. For example, one of the benefits of “Circle Two” membership (for the busiest of Neiman’s charge card users) is fur storage, which made me giggle. I’m the kind of gal who worries that someone might mistake her faux fur coat for the real thing. The cover of the InCircle member brochure asks, “Are you a member of the in crowd?” Uh, no. Not usually.

Lessons Learned

In retrospect (and sarcasm aside), there were better ways to handle the situation that would have given the salesperson credit for the sale and would have avoided me opening a store card I absolutely do not want.

When I told my husband what had happened, he had the perfect solution: “You could’ve asked the salesperson for her name and told her you’d come back to pay in cash.”

Yes, that is exactly what I should have done. But when I was in the situation, I wasn’t thinking clearly. I felt pressured, irritated, and that I had to make a choice right then and there, when I really didn’t.

(Also, I was reminded that I should carry at least one paper check with me. I used to do this, but fell out of the habit because it was so rare that I ever needed one. Now I’ve tucked one into my wallet again to have one more payment option.)

I never, ever thought I’d open a store card. I’m disappointed that I let it happen, but at least I can amend the situation. I certainly now understand, from firsthand experience, how tricky retailers can be when it comes to pressuring consumers into opening store credit cards.

Are All Store Credit Cards Bad?

The mark on my credit report is long gone, but it was a sobering lesson about the dangers of credit, especially for someone with little personal finance education (or income). When I graduated from high school, I could easily find the limit of a function as x approaches a constant, yet I didn’t know about compound interest. My personal finance education began years later when I started lurking here at GRS.

I haven’t carried a credit card balance in years, and I consider myself a reformed and responsible consumer. I’m also not completely opposed to store credit. If I were remodeling a house, for example, maybe I’d consider a Home Depot card for the initial discount. Then I’d cut up the card and pay the balance immediately (as in the minute I got home) with cash I’d saved in a “home remodel” savings account.

I realize most GRS readers are savvy with their credit, but as stores ramp up their high-pressure holiday pitches, it’s important to be on guard. By and large, these cards aren’t worth the hassle or the risk. Credit is serious business, not something to sign up for on the spur of the moment without reading the fine print.

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There are 212 comments to "The dangers of store credit cards (and how I got suckered into opening a store credit card)".

  1. Paul says 02 December 2010 at 04:20

    For me, along with all the other downsides of store cards, is that they rarely have the customer support, or communication channels that regular cards have.

    I have two cards with Egg (a UK offshoot of Citigroup), who are a pure online/phone operation. One card is my personal card for my discretionary spend, the other is a joint card with my girlfriend for shared expenses (going out, vets bills etc).

    Both cards are paid off in full automatically by Direct Debit so I never pay interest. Because they are online I can check my balance and transactions every day (and I do). In fact I check then so often I’ve actually caught fraudulent transactions so fast that Egg were actually unable to reverse them because they hadn’t fully cleared 🙂

    The only store cards I’ve opened in the past have been abysmal by comparison. Most are run by white-label credit suppliers like GE Money, and provide no online access, and dreadful phone support. So the best you can do is wait for your monthly bill, and then be surprised.

    I am never surprised by my credit card bills from Egg, and it actually allows me to keep a close eye on all my spending through the month since everything goes through two accounts that are easily accessed. Splitting your spending across multiple methods, and especially multiple forms of credit is a sure-fire way to lose track of your spending, unless you keep meticulous records of everything.

  2. LifeAndMyFinances says 02 December 2010 at 04:39

    I experienced a similar journey, but I signed up for a credit card at a Detroit Tiger game. All for a free T-shirt.

    Since marrying my wife, we both decided to get rid of our credit cards and now we live solely on the income we bring in, while paying down our school loans.

    We’re getting close! We’ve paid off $9,000 this year and will be debt free in about 6 months! You can find my journey by clicking on my name above.

  3. Lindsay says 02 December 2010 at 04:44

    What do you think of store DEBIT cards? I’d never heard of them until I was at Target the other day. They offer a DEBIT card that links directly to your checking account, and it let’s you save 5% on every single purchase. AND once you get the card, you can designate a school to receive 1% of the price of everything you purchase! It sounded too good to be true, but sure enough, after reading all the literature and talking to a manager to make sure I understood, that’s exactly what it is! I signed up immediately!

    Might I have missed something where this, too, is secretly a big mistake?

  4. Andrea says 02 December 2010 at 05:59

    Store credit cards (and email lists/catalogs for that matter) also have a sneaky way of getting you to want to buy more stuff. The store sends you something saying there’s a sale, and suddenly you think you can save some money, when in reality you will end up spending money you hadn’t intended on spending in the first place.

  5. Nicole says 02 December 2010 at 06:04

    I had an acquaintance in college who bought so much at Macy’s and had so much Macy’s debt that she got a part-time job at Macy’s. With the Macy’s employee discount, she got into even more Macy’s debt.

  6. retirebyforty says 02 December 2010 at 06:06

    I completely agree with this. We only have a Macy’s card in addition to our one visa card and use it responsibly. The rate is just too high to carry a balance.

  7. Jacq @ Single Mom Rich Mom says 02 December 2010 at 06:07

    I got into trouble with store and regular credit cards many years ago. I think it’s best that if you are going to have any kind of credit debt that it’s not spread around among multiple cards. It’s a slippery slope towards spending more money that you don’t actually have.

    In the last couple of years, I’ve signed up for two store cards – Macy’s and Home Depot. At the Macy’s, I made my purchase, got my 10% off and another 15% and paid the whole thing off right at the till with the cash I was going to use for the purchase. With the Home Depot card, I bought some stuff on their “do not pay for a year + 10% off” and although the payment wasn’t due until Feb, 2011, I paid it off slowly throughout the year just because it bugged me that it was out there. The accrued interest that would have been payable if I hadn’t done that was written on the statement? – yikes, that was a lot of money!

    For most people that have ANY kind of balance that they carry on any cards, the benefits aren’t worth the temptations.

  8. Bill says 02 December 2010 at 06:07

    A cautionary tale from long ago (meaning things may have changed).

    Back in the early ’70s, my wife had her purse stolen from her workplace. We immediately began calling credit card companies to cancel the cards.

    Everyone was easy to work with EXCEPT two store cards — Sears and J.C. Penney — neither of which had a current balance at that time.

    Both companies’ “customer service” departments were rude and accusatory, as if we were trying to scam them over our cards. In fact, both were willing to help us ONLY after confirming that we had no balance we were trying to somehow skip out on.

    In the end, a store owner a block from my wife’s employer found her purse in his doorway a few hours later, with all the cash removed but none of the cards.

    We had had so much trouble with trying to cancel the two store cards that we didn’t even attempt to renew them.

    Like I said, things may have changed.

  9. First Gen American says 02 December 2010 at 06:27

    How about another negative…another bill to have to deal with and manage at the end of the month. I only have one personal credit card, because I want to minimize the amount of physical bills I have to keep up with.

    The simpler my life is, the better.

  10. Leeora says 02 December 2010 at 06:30

    I have one store credit card at a store that has fantastic sales in the spring and fall. 75% off then another 20% when I use my store cc. I shop these sales each year and buy our clothes for the next year. I buy only what I have money for, and then when the bill comes I pay it. I also get sales flyers that I would not normally get. I save a lot of money this way. I have gotten things cheaper at these big sales, than I could have at the thrift store. It works for me.

  11. TBonesmind says 02 December 2010 at 06:39

    I personally use credit cards, but I hate store cards. The worst part about them is it is easy to forget to pay them if you do not use them often.

    I admit I did get a Macy’s card when I got married since we registered there. In that case we were able to get points from folks who bought things off our registry, which then turned into a couple hundred dollars in gift cards. We were able to get the benefit without spending a dime. Needless to say once we used the gift card, the Macy’s card got put in a draw.

  12. Alex D says 02 December 2010 at 06:48

    Target actually gives you a pretty good deal with their cards, if you can manage it. Target does 5% of every purchase. The interest rate is pretty high on the card though, 22% or so. The easy way to avoid paying interest is just to log onto their website and set it up so the new balance for the card is just charged to your bank account every month. You will never be charged an interest fee because you are paying it off every month.

    Of course the easier way to do this is just to get the debit card. You still get 5% off every purchase. It acts exactly like a debit card and just pulls the money directly from your account.

  13. Mom of Five says 02 December 2010 at 06:52

    @Lindsay #5
    Target is the only store credit card I currently hold and I just recently got it for the 5% discount. I went with the credit over the debit because I prefer not to give Target (or anyone really) access to our checking account.

    Groceries account for the bulk of my Target purchases. Otherwise, I wouldn’t bother as my rewards credit cards often can compete pretty well with the Target discount and for the 2 or 3 other non-grocery purchases a year that I make at Target, it would just be silly to keep the additional credit line.

    By the way, my Target store increased some of their grocery prices on the same day the 5% discount became effective, so I’ve actually done less shopping at Target since I’ve had my store card. For instance, yogurt went from 52 to 59 cents. That’s a much bigger jump than 5 percent.

  14. Brett says 02 December 2010 at 07:02

    I agree that store credit is one of the worst ways to buy stuff. I signed up for a Macy’s card when I moved into my new apartment a few months ago, and just reading through the fine print briefly showed lots of fun language weaseled in there. I do the same thing of paying off the balance as soon as I get home, but it often makes me wonder why I even bother getting it in the first place.

  15. smirktastic says 02 December 2010 at 07:10

    #11 is a great example of using a store credit card to your advantage. My favorite is Kohls becuase they send lots of special coupons throughout the year. However, I also have the willpower to not spend more on credit than I would with cash in hand. We never carry a balance on it.

  16. KC says 02 December 2010 at 07:18

    You also end up with a wallet of credit cards. If you don’t carry them around you won’t use them and get any benefits they might offer. If you do carry them they take up space in your wallet and you run some risk of having them stolen.

  17. Andy says 02 December 2010 at 07:36

    I forget the name of the book, but it is by the same authors who wrote the Two-Income Trap, and there are quite a few disturbing stories about store credit cards. For example, the contract for the Sears card is written so that you don’t own the product you purchase until the card is paid off. They have a very aggressive repo department. So a grandfather buys his grand-daughter a present on the sears card. The grandfather then dies with a balance on the card. Sears would call and harrass the grieving daughter threatening to come and take the item back from the grand-daughter. There are quite a few similar stories.

  18. me in millions says 02 December 2010 at 07:49

    One thing that I’ve noticed about store credit cards is that the more you use them, the more coupons they send you in the mail enticing you to spend even more. I do like having my store credit cards (Banana Republic and Ann Taylor) so that I never wind up paying full price for merchandise, but I have to check myself ALL THE TIME so I don’t let my spending get out of control. Coupons are so tempting!

  19. Susan in CO says 02 December 2010 at 07:57

    My husband and I do have a JC Penney card, but we use it very strategically and I pay it off online within a day or two of making a purchase. We got it mostly to help build our credit back up – years of bad credit had finally dropped off our credit reports and we had discovered that having NO credit rating was almost as difficult as having a bad one.

    This might not be strictly on topic, but I did want to chime with this comment: I remember working at a Mervyn’s right out of high school (I think the chain is defunct, now) and the pressure was intense to market those store credit cards to customers. (That was the late 80s-early 90s, I can just imagine what it’s like for store clerks now.) As much as I don’t like getting a hard-sell on a store card, I do try and remember that the clerk is required to make that pitch. Sometimes I get behind another customer that really rips into the store employee over the store card offer and I just want to smack them. Yes, it’s annoying, but talk to a store manager about your complaint – don’t tear into the cashier making minimum wage who will get written up or fired (I’ve seen it happen!) if they don’t offer store credit to each and every customer.

  20. David W says 02 December 2010 at 08:04

    I usually tell the cashier that I already have one(I don’t). This allows them to stop bothering me for the most part.

  21. Adam says 02 December 2010 at 08:09

    I can’t say enough good things about my REI Visa card. However REI is organized as a consumer’s co-op, so you have to pay a small one time fee to become a member.

    I buy quite a bit of consumable items there, along with clothing, socks and camping gear and getting up to 15% back from my purchases there once a year is really nice.

    I didn’t get the card because of a special deal or offer, when you shop at REI often, the rewards are fantastic.

  22. Gena says 02 December 2010 at 08:25

    Sales folks may be required to ask, but boy, I’ve gotten good at “No.” And the wording just gets me! “Would you like to save 10% today?” Who wants to answer that in the negative? I just say “Thanks, but I have enough credit.” Any other push gets a simple “NO.” It’s a complete sentence.

  23. Diane says 02 December 2010 at 08:31

    Back in the Old Days, I mean 30 years ago, you had to prove that you deserved a VISA or MasterCard, and the way to do that was to get a department store or gasoline credit card and pay them off for a few months before you could apply for a major card and hope to get approved. How things have changed.

  24. Kelly says 02 December 2010 at 08:44

    I have to admit that I have a Best Buy card that my husband and I have used for purchases like computers and appliances. On any purchase over $500.00 we have 18 months to pay it off. I simply divide the amount by 17 months, make that payment every month, and generally will pay down the rest early somewhere around 15 months so it has been a real help to us when we needed it the most. The trick is to make sure you are monitoring the payments and have everything paid up before the 18 months is up.

  25. Steve says 02 December 2010 at 09:00

    This may be a naive question, but I’m not sure of the answer…
    I have a BestBuy store card that I used a couple years ago to purchase a new TV. It has long been paid off, but was not sure if keeping it open (with no balance) had a positive effect on my credit score.

    I know that having unused/open credit on your record is good, but am not sure if a Capital One credit card is viewed the same as a BestBuy(or other store) card.

    I’m still working to pay off the cards I do have balances on, and don’t want to hurt my credit score by getting rid of an unused card, by reducing my available credit amount/percentage.

    Any help is appreciated!

  26. Elizabeth says 02 December 2010 at 09:05

    I had two store credits and never had a problem — but I canceled them anyways. I seldom used them, and I hated that I couldn’t track them online.

    I ended up canceling them to protect my privacy. All the extra junk mail could end up in the wrong hands, and the cards could get lost or stolen. I like to keep things simple.

  27. Jennifer says 02 December 2010 at 09:09

    Awesome post. Exemplifies why I insisted my daughter, a high school junior, take the Personal Finance course offered as an elective. You don’t need to know the square root of anything to survive in this world, but you do need to know what APR is. Calc and Trig should be electives, Personal Finance should be mandatory for a high school diploma!

  28. Jennifer says 02 December 2010 at 09:12

    One more note to add: The last time I was at Gap, the clerk asked the girl in front of me if she’d like to save 10% by signing up for their credit card. She declined, but the thing that really irked me is that the girl looked no more than 15.

  29. Shari says 02 December 2010 at 09:47

    for #25–Steve:

    you might want to check and see if your account has already been closed. Some stores will close accounts for being inactive and not even let you know they have done it. Target did that to me(I hadn’t used my card for over a year) and the only way I found out was when I pulled my credit report and it showed that one as closed. When I called them to confirm it, they said that they generally don’t notify people when an account it closed for non-use.
    I can’t see that keeping it open would have a bad effect on your credit score if it has a zero balance, as long as you keep it that way.

  30. partgypsy says 02 December 2010 at 09:50

    The 10 (or 15) % off deals are so tempting, especially for something you were going to buy anyways, but the more cards you have to keep tabs on, the easier it is to overlook something and get socked with fees.
    I bought a dress and opened a store card to get a discount. I only used it that once, paid it off, and the local store closed. But many years later, the card kept showing up on credit pulls. When I tried to cancel the card the national store kept saying I didn’t have a card with them and would do nothing. I was so paranoid someone would start using it my card information. Finally at least 10 years later it dropped off my record. Because of the frustration I didn’t get another store card for many years.

    I do have to admit that I have 2 store cards right now, bought for specific purchases. One I will close after I finish paying for the purchase, the other I may keep.

  31. chacha1 says 02 December 2010 at 10:06

    Same story as Shari – I had an Express card that was closed without notice for inactivity. A bit annoying when I finally pulled it out to use again. But it still shows up on my credit report as open. Which is also annoying.

    I’m at the decluttering, simplifying stage of PF. Having multiple credit cards is just an invitation to spend too much and it complicates my life. So my three store cards, all unused for over a year, are about to be cancelled.

  32. Jenny_Dee says 02 December 2010 at 11:11

    I have two store cards. I signed up for Old Navy to get the immediate discount last year, but never used the card. The other is a Firestone card, that gives me three months no interest. It’s great when I have a minor repair of about $150, instead of just the oil change.

    I’m down to two credit cards with a balance, but will pay off one by the end of the year. The other will be paid off next year, and then it’s student loan time. I

  33. Bradley says 02 December 2010 at 11:11

    Plastic in general is bad news for me. I had a similar college experience with credit card sign ups. Made the mistake to get a few store cards too.

    Took lots of years to get them paid off and change my habits. Now, the only plastic I have is my debit card.

    Refusing a store card is much easier than dealing with high interest rates!

  34. KM says 02 December 2010 at 11:19

    Store credit cards are a good way to build your credit rating. I did that, in the 1980’s. I think I only spend a total of maybe $25 on 5 cards during that time–and paid it off immediately. But I did get a great credit rating out of it that I still have!

    Credit cards aren’t inherently dangerous–you just have to remember who you really are when you get them. ie a person who doesn’t have enough money to shop like Paris Hilton(or your older, more financially secure, parents).

  35. KarenJ says 02 December 2010 at 11:27

    Yes, you do have to be careful, as it’s easy to get sucked into applying for these cards to receive special offers, discounts and coupons. Recently I was asked to apply for a Firestone card when I purchased new tires, an expense I was planning on paying for within the month. They got me at $35 discount! When I received the bill, I set up automatic bill-pay to pay $55 a month for 6 months so the card is paid in full during the 0% promotional period. If you’re not careful, you can really get burned!

  36. erika says 02 December 2010 at 11:38

    Back in the days before I found GRS and started getting smart about money management, I had several store cards and used them, too. The interest rates are terrible, but I wasn’t worried about it then.

    Now that I am responsible with my finances, I consciously chose to have 2 store cards – Kohls and Home Depot. Kohls because I have a family of 4 to house and clothe and their cardholder discounts are excellent. Home Depot because we own a rental property and a home we’re remodeling and the 0% interest for 12 months is fabulous. The caveat of course is that we are now disciplined enough to pay off the Kohls card as soon as we use it, and to divide the HD balance by 11 and pay it monthly before the time is up and the big chuck of accrued interest gets dumped on it.

  37. Mike says 02 December 2010 at 11:41

    I like using store cards, responsibly. We saved a lot on a piece of furniture at Pottery Barn. We had 12 months to pay off the balance (their payment plan would have been in 15 months), but I set auto-pay to clear it in 8 months to make sure I had a few statements of 0 balance.

  38. Mark says 02 December 2010 at 11:53

    This article should be renamed “The Dangers of Irresponsibility”. You can’t blame a store credit card for not psying your balance off each month. You can’t blame a store credit card because you “forgot” you applied for one. Your only semi-legitimate gripe is the high APR’s they usually have – but even this is clear on the documents. Don’t sing up for things that you don’t understand.

  39. brooklyn money says 02 December 2010 at 11:56

    If you are making a $5,000 or even just a $1500 purchase, I find that it’s well worth it to get the store card. Just like Mike #37, I bought furniture (mine was Crate & Barrel) and had 6 months interest free to pay it off. Who doesn’t want that? Of course if you can’t handle credit or you pay interest on your balance, then you probably shouldn’t have any credit at all.

  40. hardworking single ma says 02 December 2010 at 12:20

    I’m all for the simplicity and no debt, but I like savings, too. So, since NOBODY has mentioned it in the first 37 or so comments, here is my trick. Listen up.
    Whenever a store clerk says I can get XYZ off my bill if I sign up for their store card, I ask if I can pay it off on the spot. In most places the answer is “yes”. You sign up, get approved, charged the amount minus XYZ, then you can pay it off right there, at the cash register with your debit card. Then you can come home and wait for your new card in the mail that will be already paid off. You may freeze, cut or cancel it if you wish. 😉

  41. Chris says 02 December 2010 at 12:32

    If you want to get snarky with cashier who pushes you with “Don’t you want to save 10%?” just say “I don’t want to pay 25.99% interest to only save 10%”. I fell for the whole “get the card and the discount now, then pay it off when you get home” argument. The problem is you don’t get a account number or mailing address for the payment for 4-6 weeks, and by then an emergency, or want parading as an emergency, is bound to come up and get that money.

  42. RitaKS says 02 December 2010 at 13:21

    I’m with #40. I often use my Macy’s card for the discount you get for using the card. But, right afer I make my purchase, I whip out my checkbook (yes, I am a dinosaur) and pay the charge in full. The big problem for me is resisting all those 15-20% percent off coupon cards they endlessly send you. But I am in my 60s and am not a heavy duty shopper anymore.

  43. Strick says 02 December 2010 at 13:30

    This brings back memories. The silliest “reward” I ever got from signing up for a credit card in college was a medium pepperoni pizza.

    …the things we agree to in college

  44. Corina says 02 December 2010 at 14:17

    Thank You so much for this post.

    I own a Sears credit card myself which I was forced into getting by a sales associate. Luckily I never activated it and this gives me more reason not to do so in the future.

  45. Albie D @ TalkingCentsBlog says 02 December 2010 at 14:30

    Did you at least get a free t-shirt from the campus rep?

    I never realized you could pay them off on the spot like hard working single mama said (#40). Good to know. I have no store cards, and don’t really shop at any places too consistently, but now I’m actually interested, seeing as I have no credit card debt. It’s certainly another story for those who already have debt, or couldn’t pay off the balance right away. As others have said, they can be beneficial if used responsibly.

  46. Leslie says 02 December 2010 at 14:36
    I worked full-time for a major department store for a little less than a year after I finished grad school. I definitely agree that store credit cards can carry some real benefits for those who use them responsibly 100% of the time. And depending on how much you spend on the card, you might qualify for free shipping, store gift cards, or other perks that can save you even more money in the long run.

    However, I really abhorred that part of my job. Not only did we have to ask all customers if they wanted to save money by opening a card, but, if they initially declined the offer, we were expected to press the point a few more times. It was understood on all levels of the company that profit wasn’t really made by the selling of merchandise but rather by the selling of credit. The shoes in my department seemed to exist only to lure the customer into the store in order to sell them a credit card.

    If the customer said they had poor credit and didn’t expect to get approved, we were instructed to suggest trying anyway. “You never know!” And in many cases, the customer was very surprised to see that they were indeed able to open an account. Ugh. That in particular always left a bad taste in my mouth.

    The sad truth is that the stores put SO much pressure on their associates to sell credit cards. In the one performance evaluation I had before I stopped working at that store, the manager glossed over my sales numbers, which were good, and focused completely on how many credit accounts I had opened. I opened my fair share, but certainly not up to the standards of management.

    In the end, I did my job and offered credit to everyone, and encouraged those with low credit to open an account. And if someone was on the fence, I would point out other advantages of the card. After all, as much as I hated doing that, it’s what they were paying me to do, and in the end I can’t say that they wanted me to be deceptive or anything like that. But after working there a few months, I learned to only ask a person twice if they said no both times. On the second “no,” most people get a more serious tone in their voice which seems to be a warning. “Ask me again, and I might just go off on you in front of all the other customers here.”

    Even when I asked a second time, I tried to keep my tone of voice very upbeat and almost hurried, to show people that I was ready to drop the issue. “Are you sure? You could save an extra $35 today, and that new account discount has no exclusions! Still no? Okay, then, let’s ring you up!”

    And all the while, in my mind, I was going, “I’m so sorry. I’m really a socialist at heart.”

  47. Briana @ GBR says 02 December 2010 at 14:40

    I have a Kohls store card that I use for the discount and pay off immediately. I think if you have that state of mind, it’s fine. But if you don’t have the money to pay for it, the interest will kill you!

  48. Petunia says 02 December 2010 at 16:49

    I don’t think this blog post demonstrated that store cards are dangerous. Rather, I think it demonstrated how being disorganized with your finances is dangerous. Ignoring your major credit card statements for 3 consecutive months will have the same result (a ding to your credit rating and late fees).

    I, too, am a fan of all those coupons Kohl’s mails to its cardholders.

  49. Jaime B says 02 December 2010 at 19:12

    I have one store card for the coupons. I’m overweight and have to shop at plus size stores. Plus size stores are not as numerous as regular stores and even more rare are ones whose styles I like that fit well too. 🙂 So, I have a card at one of my favorites and they give out pretty great coupons. So I charge $20-50 occassionally to keep the coupons coming and pay it off immediately.

    But agree – something so little can really get you in trouble if you don’t have a lot of control or don’t pay attention.

  50. Cat says 02 December 2010 at 19:44

    I got my first credit card when I was 12 and was traveling with an international student ambassador program without my parents. I racked up a good 4 grand, and managed to pay it almost all the way off babysitting and fund raising with candles and tupperware and can and bottle drives. Then I went to europe the following year and racked up another 5 grand, and luckily managed to pay that pretty much off too with tag sales, bake sales, more tupperware, fifty fiftys, candles, and donations. Then I went to college. College was the biggest mistake for my spending! Clothes, parties, etc. I think the hardest thing for me to believe, looking back at that, is that it was so easy for me as a kid to be motivated and focused about money and now I have to make this HUGE conscious effort to pay it down. I estimate, that finally, since I was 12 (I am 22 now) That I will have it down to a 0 balance for the first time by next June(only so long because I still have to pay all my student loans which made me pay less for my credit card that I’ve had for so long). 10 years. Wow. I can tell you, that when that freedom comes, regardless of my student loans, I will be SO HAPPY and I can imagine how good it will feel.

  51. Heather says 02 December 2010 at 20:55

    I’m not a fan of store credit cards for reasons that the article and the previous commenters have pointed out, but I have to say – the APRs that you listed are ALL lower than my credit card (not a store card). Not an issue – we charge very infrequently and pay in full – but interest rates nowadays are ridiculous!

  52. Andrea says 03 December 2010 at 09:31

    Six months ago I would have used my Macy’s card without hesitation because:

    a. I thought I was saving more money if it was on sale.

    b. If I had coupons I would save even more.

    c. I didn’t know the difference between wants and needs.

    Now that I am trying to pay off my cards, I think twice before taking out my card and if I do you my Macy’s card for extra savings, I immediately pay the bill after using the card.

  53. Megan says 03 December 2010 at 09:34

    One thing to remember, in response to #40…opening and quickly closing new cards can really do bad things to your credit score. Be selective in opening the store cards, go ahead and pay them off right away while you are there, but don’t cancel them if you think you’ll be back to that store in the next 1-2 years, instead just store them somewhere until your next trip.

    As for me personally, I have the VS card with some stupid high interest rate I don’t care to know since I pay it off as soon as I get back from the store or in the next day or two if it’s near the end of the month. I get tons of coupons for free stuff, $10 off, etc but it really doesn’t make me want to spend more, I probably use the card 1-2 times a year, just to keep it alive since it’s my oldest, non-authorized user, card.

    I do think though that this article should have mentioned more that, with proper education and willpower, store cards are no worse than anything else – you just have to pay them off before they charge interest.

  54. Bill says 03 December 2010 at 09:54

    I totally agree with comment #38 by Mark. I was thinking the same thing myself about how this article was named incorrectly. Perhaps it should be called “The Dangers of Stupid People”. I mean really, don’t blame the stores, the clerk or the credit card companies. You only have yourself to blame. “By and large, these cards aren’t worth the hassle or the risk”, only if you don’t know how to manage your money and your bills. Three months delinquent on a card before she paid it off…..whose fault is that? I don’t feel sorry for you. I was brought up that if I didn’t have the money to pay off the purchase I shouldn’t make it. Treat the card like its cash and unless you have the money in the bank, don’t use it. This way you won’t find yourself up to your eyeballs in debt and asking what happened. I’ve been paying off my cards in full and never pay interest and can benefit from the rewards and not having to carry the cash with me.

  55. Rob Ward says 03 December 2010 at 20:29

    We have two store cards that we hardly ever use. The few times they have been used, we pay them off immediately. The only reason we got them in the first place was to get a some good deals on clothes.

    But honestly, I wish we hadn’t bothered. It is just one more bill I have to keep track of. If we didn’t have the store card, we would just use our regular credit card like always and that is so much easier to track in our budget.

  56. Suzie Bee says 04 December 2010 at 06:08

    The real question is how to get people to take this advice to heart without having to learn these sorry lessons for themselves. Teenagers just about to go to university won’t listen to finance lessons in school because they’re so uncool, as are parents. I suppose we can just keep drumming it into them from every angle and hope it will stick.

  57. Danielle says 05 December 2010 at 19:37

    I work for a store that asks its employees to sign people up for credit cards… I have never asked, and will never ask. If they ever bring it up to me, I will politely remind them that consumer debt was one cause of our current recession that keeps me bound to a part-time retail job which I could care less about. Then I will ask them if they know that average consumer debt is around $15,000. Then I will ask them why reading the small print is not included in the training for signing people up. I will not sell a product I don’t understand and morally object to.

  58. jSarie says 06 December 2010 at 08:05

    As annoying as it is to hear “do you want to open a [store] card today?” every time you buy a bag of coffee beans, I think #34 makes a good point – Credit cards aren’t inherently dangerous.

    And the fact that store cards will often be closed if they’re not used can be a bonus. I’ve received the “open an account, get 25% off” deal 3 times at Sears – buying a central vacuum system + installation, buying a dishwasher 2 years later, buying a fridge a few months ago – each time the item was paid off immediately, so interest rates were irrelevant, and since the card that came in the mail later was never activated they would close the account within the year, thus allowing me to qualify for the “new account” discount multiple times. On big ticket items, the savings are significant!

  59. Dept Payer says 16 May 2011 at 04:19

    I remember the one time I opened a store card was when I purchased my wife’s engagement ring. I think they said it was a “requirement” for me to get the “negotiated price” that I had to open the card. I later learned that most jewelry stores are not in the business of selling jewelry–they are in the business of collecting interest on debts. That’s exactly what a banker once told me, and I found that really interesting. He said many stores break even or close to it on their merchandise and are really (semi-secretly) in the credit industry. I too found it a pain in the neck because when I tried to cancel the card (after having paid off the engagement ring) they made it really difficult. I think that “closed card” still shows up on my credit reports so maybe I need to look into that part of it as well. Bottom line: got to be careful with the store credit cards. Thanks April for being honest about getting “suckered in”, it happens to the best of us.

    • jeffeb3 says 16 May 2011 at 08:07

      Same here. That’s the store card I have. I thought I was going to earn a lot of interest on the delayed payments, but since I have to go into the store to pay the monthly bill, I almost missed one, and decided it wasn’t worth it.

  60. Nicole says 16 May 2011 at 04:31

    That’s crazy! I would think that most people would want to use Visa or Mastercard at an expensive department store. Someone like me would be aghast and just walk out. Not accepting regular credit cards is something one expects at small food stores in far-flung neighborhoods, not major department stores.

    Thanks for the interesting story!

  61. retirebyforty says 16 May 2011 at 05:43

    It seems ridiculous that they don’t accept Visa/Mastercard. I would have just left and come back to pay with cash later. I don’t know anything about exclusive stores though. I guess taking the name of the sales person is the way to go. How much commission do they get anyway?

    • Amy Saves says 17 May 2011 at 13:20

      right?! who doesn’t take visa/mc? that’s just insane. i would have left too.

  62. Mike Holman says 16 May 2011 at 05:47

    We all make mistakes. 🙂

    The thing I found most amazing about this article was the fact that the store takes checks. I didn’t think that ever happened anymore.

    • Joanna says 16 May 2011 at 07:58

      Yes, they take checks, but they also require your social security number as I found out the one time I also tried to by something there last year. I refused to give it to them as I didn’t think it was any of their business, especially as my driver’s license should have been sufficient proof. I subsequently walked out without making the purchase!

  63. Elaine says 16 May 2011 at 05:49

    We recently joined Costco and they only take debit, check, cash or their American Express card. But at least they were upfront about it when we signed up for a membership. That’s really weird that Neiman Marcus doesn’t at least take debit.

    • Marcus says 16 May 2011 at 06:26

      I got duped into signing up with for a CC when I joined Costco. The guy took us around the store, bragging about their premium nuts (no joke) and then finished the pitch by telling us that to become a member it was $100/yr plus you had to enroll in a Costco Amex card, but it’s all good because the Amex card pays cashback and Costco will guarantee you at least $50/yr if you don’t rack up that much in cashback. Later I found out that I was duped into signing up for the “Executive Membership” and that I could have just paid $50 and signed up for a regular, no cashback membership 🙁

      • Elizabeth says 16 May 2011 at 15:12

        We have the Costco Executive Membership. What the salesperson was telling you is that if you don’t earn enough cashback to make the Executive worth it (an extra $50), they will reduce your membership to the regular Costco Membership (and deduct the extra $50). Basically, if you earn $75 off the Executive, but would have only earned $10 on the regular – it was worth it to pay the extra $50 because you got $65 in benefits. If the difference is less than $50, they’ll refund you the $50 back and downgrade your membership for the previous year.

        Costco is one of the big-box stores I really respect, and this is one of the reasons why. As long as you’re on top of it, you can get the best of whatever membership happened to be right for you. The trouble is if you spend for the Executive, and then never follow up with the rewards check to make sure it was worth it.

      • El Nerdo says 16 May 2011 at 17:22

        Elizabeth is right, you’re confusing two separate things.

        I have the executive membership which costs $100 upfront but ends up nearly free after cash back.

        There is also the option of applying for the Costco AMEX card, but that’s a whole separate issue.


    • LC says 16 May 2011 at 06:31

      Alternatively, Sam’s Club only takes Discover (and debit, cash).

      I believe the reason behind it is that the Merchant sets up a deal with the CC company for discounted merchant fees in exchange for their CC being the only one accepted. This saves the Merchant money and guarantees the CC company revenue.

      As for Neiman’s, the vast majority of their targeted clientele carry AMEX, and use it almost exclusively, which is why this arrangement works. They target a very specific demographic in their business model. It likely wouldn’t pay off to accept all other forms of payment, given the trade off of higher AMEX fees in addition to other CC fees, for a relatively insignificant increase in business from persons who do not carry AMEX.

      AMEX is all I carry, actually, because they have, by and large, the absolute best service and perks for cardholders (in my experience). They also have some of the highest merchant fees, which is why many smaller merchants don’t accept AMEX.

      • cmadler says 16 May 2011 at 08:55

        I agree with the comment about AmEx’s service. AmEx has been my primary card for more than a decade, because I so appreciate their customer service. I do carry a VISA from my credit union for backup, because so many places don’t accept AmEx.

      • NicoleZ says 16 May 2011 at 09:16

        Not sure if it’s a regional or per store thing, but the Sam’s Club by me accepts MasterCard.

        • KC says 16 May 2011 at 12:06

          The Sam’s Club near me only takes Discover – same for the ones when I lived in Memphis.

        • Joe says 16 May 2011 at 12:11

          The Sam’s by me accepts Mastercard now too, but for a while they were playing the “Discover only” game. I thought they dropped that policy when people got upset about it (like my parents). It never really bothered me, since they still take debit cards.

        • Tom says 16 May 2011 at 18:43

          I thought our Sam’s Club only took Mastercard and not discover… Either way, we ended up switching to Costco and now just use our debit card. We thought about signing up for AMEX, but so many places don’t accept it, and we don’t want to actively use two credit cards.

  64. Max Jaffe says 16 May 2011 at 05:50

    Also keep in mind every time you open a new account, it will decrease your FICO score. First of all, there’s an inquiry into your credit, which reduces your score, and then you have the ability to charge more, so the credit bureaus think you will, which lowers your score as well.

    • Jay says 16 May 2011 at 06:46

      This is how misinformation is spread.

      False. You score will decrease 2-5 points on the inquiry, however will go UP do to that fact that you have now reduced your credit utilization percentage (as no you are using less cummilitive vs you total allowed amount).

      Generay speaking, the effect on your score is negliable at best.

      • LC says 16 May 2011 at 09:05

        Definitely agree with Jay on the misconceptions that are spread about credit scores!

      • Greg C. says 16 May 2011 at 09:07

        I don’t think it’s going to help when she closes the account right away, though.

    • Elizabeth says 16 May 2011 at 17:23

      Sorry, I can say from experience that this is not always true. I used to have just one credit card. Then, I opened up 2-3 more in the space of about 6-9 months. My credit score went up about 10 points. The reason? My credit limit soared, which improved my credit utilization score and ultimately my whole score.

      On a different note, the fact that the store doesn’t take Mastercard/Visa is very surprising to me. If I was in that situation, I would have just walked away at that point. Frustrating, but the last thing I need is a store credit card.

      • schmei says 17 May 2011 at 09:09

        I smell a post here, JD: I totally thought any inquiry into one’s credit history automatically lowered one’s FICO score, too.

  65. JakeIL7 says 16 May 2011 at 05:58

    I had this same issue years ago when I was considering a membership to Sam’s Club. They only took their in-house credit or Discover. In the end, I refused to shop there.

    As I understand it, AmEx and Discover have this “exclusivity” with a few retailers as they are smaller the the Visa/Mastercard duolopoly. I won’t shop at places that don’t accept my cards, but I understand. There must be far smarter people in the business office making the decision to go this way.

    • LC says 16 May 2011 at 06:38

      I only use an AMEX card, and I’ve definitely been burned by selecting that card to carry. Many smaller merchants don’t accept the card, so I’m left hoping I have enough cash or my Debit MC on hand to pay with instead. I wouldn’t trade my AMEX for anything, though. The perks are too good.

      • Elizabeth says 16 May 2011 at 07:02

        Many small businesses don’t accept AMEX because AMEX charges them more in fees than Visa or Mastercard. (At least that’s the case here in Canada. Not sure AMEX is as popular here!)

        • LC says 16 May 2011 at 07:40

          Yes, I know that is why. And I definitely don’t fault those businesses for doing so and I gladly visit them with cash instead. However, for me, AMEX is better as a result of what those fees cover: excellent purchase protection, insurance, and fraud protection, to name a few. So, especially for big ticket purchases, I always use my AMEX.

        • Elizabeth says 16 May 2011 at 07:53

          Figured you probably did know, but others might not 😉

          Incidentally, I know someone who was forced to sign up for an AMEX card at Costco because the purchase was too large to debit. Go figure!

      • JakeIL7 says 16 May 2011 at 10:39

        I’m curious….what benefits do you get with an AmEx you can’t get with *any* Visa/MC? I’ve thought about carrying one but could never get around the fact some merchants don’t accept it.

        • LC says 16 May 2011 at 14:31

          A couple examples: They have the best purchase protection for consumers. They offer warranties on many purchased products for loss, theft, or damage within 30-90 days+. Same with fraudulent vendors, etc. They have the best customer service in general and the easiest fraud resolution process. Report it, they take it off your bill and don’t pay the merchant or require payment until it’s resolved. They are a kind of known for being a cardholder’s-card, rather than a merchant’s-card, if that makes sense. There are a host of other reasons, just check out the AMEX site and compare it to your own card. Visa or Mastercard may have some similar offerings, but AMEX won me over years ago and their service is still the best, IMO, and I’ve each major credit card at one time or two. (And no, I’m not employed by AMEX, just like their card)

  66. MC says 16 May 2011 at 05:59

    Why close it unless there is an associated fee? I’ve opened several store credit cards for major purchases just to get the zero financing and then just left them open knowing full and well I have no intention of using them again. I don’t think there is any harm to that. Doesn’t closing the card hurt your credit score too?

    • Laura in Cancun says 16 May 2011 at 10:56

      I’m curious if anyone knows the answer to this. I opened a store CC with Victoria’s Secret a few years ago and got some great deals with it, but I don’t really use it anymore. There are no fees, so am I better off closing it or just leaving it open?

      • KC says 16 May 2011 at 12:13

        You are opening yourself up to potential fraud by having more credit cards open, but it’s very, very slim. And from my experience you have to be using the card (either physically or online) to have the number out there to be stolen. I suppose if someone hacked the Victoria’s Secret database they could get your number.

        IT can also effect your credit score as it’s potential debt you could rack up. But again – if you have your finances under control it’s probably not going to effect it. I have several opened, but unused cc accounts and my score is still above 800.

        And, of course, there is always temptation. Some people might have a problem having an open credit card and be tempted to rack up debt. But it doesn’t sound like you fall in this category.

        I don’t carry inactive credit cards in my purse in case my wallet is stolen. Your best bet is either cut them up or hide them some place in case you have a burglary (put them in a ziploc bag and stick in the refrigerator LOL!)

        • kb dragon says 31 May 2011 at 15:12

          I’m dealing with a fraudulent charge (of over $1500) on a card that I only opened to pay for a home improvement project. I should have just paid cash! I was pressured into the card, and because that was the most convenient option at the time I went with it.

          I never used it except for the initial purchase. The initial purchase was forms filled out on my kitchen table. I immediately set up automatic payments well over the minimum. At first I would check it every month, then every other month. When I looked this month – with the intention of finally just paying it off – I saw the charge. It was made in January. I got so complacent I didn’t check the card for five months!

          I have absolutely no idea how the criminal got my credit card information, but now I have to deal with it, just because I was suckered by a “good deal”.

          Lesson learned – a new credit card, no matter the financing or convenience – is NEVER a good deal when the first you hear of it is from someone selling you something!

      • LC says 16 May 2011 at 14:37

        A lot of CC companies will put your card into an inactive status or even cancel it for you after a certain period of non-use. I had a Capital One Visa ages ago and didn’t use it for years. After three years, they sent me a mailing saying that had closed the account due to inactivity. Alternatively, I had a Discover card for the same period of time that I never used. Rather than cancel, they moved the card to an inactive status that would require me to contact them in order to start using the card again. In that case, the account history remained on my credit report as an open account in good standing.

        You may want to call to confirm how they treat inactive accounts, if it bothers you to have open. I would leave it open, if you can, especially if it is your oldest instance of credit. Closing an account (esp your oldest one), shortens your credit history and can reduce your credit/debt ratio, both of which affect your credit scores.

        For those that don’t know what I mean by credit/debt ratio:

        If you have 3 cards with $10,000 of credit, and you rotate a balance of $2,000 on it, you have a credit-debt ration of 20%. If you close a card that accounts for $5,000 of your credit, then you have increased your credit-debit ratio to 40%. Not good for your credit scores.

      • DreamChaser57 says 16 May 2011 at 18:44

        I think the answer depends on what you want to do, as far as your financial goals. I don’t like orchestrating my life around credit card perks, opening this one, closing that one – trying to track this one. My ultimate goal is for a simple financial life – just one credit card irrespective of the impact on my credit score. I want to devote more time to learning about investing and I have seven good titles I want to read. Time is a finite resource. I can respect other people going in another direction.

    • Megan says 16 May 2011 at 12:48

      As mentioned, the cons are an open card that could be hacked – the pros are a longer history and higher available credit.

      I also have a VS card that I haven’t used in more than a year – but I keep it open because:
      A) it’s my oldest card – and the history is good
      B) I get free undies and coupons from VS as a member
      C) I check it at least every month or two to make sure there is no activity so I’m safe from hackers

      Honestly, the only reason not to keep store cards open is keeping track of them. I keep any unused cards in one area, together, and make a note to check on the activity every once in awhile (and have the company send me an email with activity).

      As long as you have no balance on them and you know where they are and you check your credit report (which you should do at least once to twice a year – its’ free after all for one and some states give you more free!) then there’s no reason to close them. The people that get into trouble are the ones that keep a balance on it and pay that high interest rate.

    • Laura in Cancun says 16 May 2011 at 12:54

      Thanks, KC and Megan! I only got the CC for the deals. Whenever I’ve used it, I’ll pay with the card then pay it off with cash immediately.

      I haven’t been keeping up with it since I stopped using it, though, so I’ll have to start doing that. Thanks for the advice!

    • jrr says 16 May 2011 at 13:42

      I close them because then in 6 months I can open a new card and get the intro deals again. I’ve opened Lowes card accounts about 5 times now, each time getting 20% off that day’s purchases. As soon as I get my card in the mail, I call the number, activate the card, ask for a payoff amount and send the check. A week later I call and confirm that they have applied the credit and the balance is zero, and cancel the account.

  67. Kathy B says 16 May 2011 at 06:00

    Just before Circuit City went under, I attempted to get store credit for my computer purchase. I had the cash but didn’t want to spend it. I filled out the application and waited about 5 minutes before I was asked to talk to someone on the phone. The person on the other end had a very thick accent, the line was not very good and the store was noisy. In any event, the person on the other end of the phone was asking me questions about my life’s credit 30 yrs ago. What was up with that?

    Long story short, I paid cash and was happy that I had done so because the following week the Circuit City stores closed.

  68. Mary Kate says 16 May 2011 at 06:15

    I don’t think you made a bad decision. You drove out of your way to go to Nieman Marcus. You will not be paying any interest. Your actions were probably the fastest way to deal with the situation. No real harm done.

    • Catherine says 16 May 2011 at 12:16

      Actually she benefited because she got something to write about without having to do any research. Although I have to say, to continue the literary motif, this seems much ado about nothing.

      • DreamChaser57 says 16 May 2011 at 12:42

        Since when does every blog post have to be a mini-dissertation replete with footnotes. I think anecdotal stories can be equally instructive…

        • Suzanne says 16 May 2011 at 19:27

          Here here DreamChaser. I learned something practical from this “light” post. I had no idea that there were retailers who don’t take Visa/MC. It will save me from some frustrating experiences, and was worth the read.

      • Deb says 18 May 2011 at 13:26

        Gee Catherine, good thing she did post this story so you could seize the opportunity to make a purposeless, snarky comment.

        I appreciate these anecdotal stories as well. After reading this one, it helps me not feel like such a dupe for all of the times that I’ve made financial decisions under pressure and later questioned myself. I’m apparently in good company.

        I probably would have done what April did and pay the balance in full.

  69. LC says 16 May 2011 at 06:36

    I don’t understand the issue with carrying a store credit card IF you pay your balance in full. Yes, I understand the high interest rates, but if you are paying in full and you shop that store often, why not benefit from the perks of being a cardholder?

    I carry a couple store credit cards, though I only use one often. That card has saved me a small fortune on clothing purchases over the years. I get the best sales news, discounts and cardholder-only deals for use on clothing I would purchase regardless. Plus, I earn points towards gift cards. Major win for me and I never pay interest because I only buy what I could afford to buy in cash on the spot and I have the card set up to auto-pay in full on the due date.

    I also have a couple store cards I haven’t used in ages. I opened them when I was in high school and college to build credit and have left them open to keep my credit history in tact.

    • Pamela says 16 May 2011 at 06:51

      Even well-managed store credit cards can cause problems. Besides encouraging you to spend on things you don’t need because you’re getting a “bargain,” they can also lower your credit score.

      Store credit cards can lower your score in two ways:

      1) Every time someone runs a credit report to offer you a card, your score drops.

      2) Store credit cards are “less desirable” than major credit cards and can drag down your “credit mix.” Department and specialty stores offer their credit cards through finance companies which don’t look as good for calculating your score than a mix of credit from more discriminating companies.

      Making sure your credit score is as high as it can be will save you money on insurance, interest on loans, and your mortgage.

      • LC says 16 May 2011 at 09:09

        As Jay stated above:

        “False. You score will decrease 2-5 points on the inquiry, however will go UP do to that fact that you have now reduced your credit utilization percentage (as no you are using less cummilitive vs you total allowed amount).

        Generay speaking, the effect on your score is negliable at best.”

        If I am not opening every possible card available and running up the limit and carrying balances, the impact on my credit is negligible, regardless of the type of credit extended. Even with several store credit cards, in addition to several major credit cards, my credit score is perfect. It really depends on how you manage and use your credit.

        And, regarding your comment on purchasing merely as a result of sales or other discounts, you are correct. If you are spending money you wouldn’t otherwise just to “save” on something you don’t need, you aren’t actually saving. If, however, you already intend to purchase the items and, because you are a cardholder, you receive special benefits or discounts, I’d say that’s a big win.

      • Ace says 16 May 2011 at 12:38

        True points, but don’t let the credit score game turn you into a dope. What’s the difference between a 812 and a 796? Zero. I have store cards at Kohls and New York & Co. because of the regular discounts they offer. My credit score is still 796. The highest it ever was before I got the store cards was 812.

        For virtually all banks and insurance companies, the top rate tier cutoff is 760. Anything above that is just gravy. Worrying about a few points when your score is already over 800 is only for bragging rights–it has no tangible effect on your pocketbook.

    • E. Murphy says 16 May 2011 at 09:24

      I totally agree with this. I use CCs and haven’t paid a penny in interest in decades. And there have been tons of percs. I have one store credit card, pay it off immediately when I use it, and have gotten lots of bonuses. What’s the problem?

      And I have an excellent credit score.

      • April Dykman says 16 May 2011 at 09:34

        Probably should have mentioned this, but for me, it’s just that I don’t want to keep up with several credit lines. Plus, if I did have a store card, I’d rather have one for a place I visit frequently. I’ll never spend enough to qualify for most of the perks at NM, and some, like fur storage, are things I’d never use.

        I do know people who have store cards and use them for the discounts, though.

        • LC says 16 May 2011 at 14:42

          I agree with this. No point in opening up a card for which you have no use.

  70. Dave says 16 May 2011 at 06:38

    I don’t generally like store cards either, but Target is an exception for me. Recently they started offering 5% off all of your purchases on the Target card. It’s not and introductory or promotional thing, you get the discount all the time off of everything you buy. I do most of my shopping for general goods and a lot of my grocery shopping at target anyway. I end up spending thousands of dollars every year, so a 5% savings is a pretty big thing.

    On top of that, if you use Target pharmacy for your Rx, they have a program where every 5 prescriptions that you fill (and pay for using the Target card) you get a coupon for 5% off of a day of shopping. This is in addition to the 5% you get off anyway. My wife and I wait for the extra 5% off coupon and then stock up on essentials like soap and shampoo and whatnot.

    • Kelly says 16 May 2011 at 12:05

      Beware the Target card, their customer service is horrible. I hopped right in and got one when they announced the 5% off as it is a better deal than my American Express Blue Cash card. I have great credit, but Target only gave me a line of $600 when I opened the card. That sounds like plenty, but I do all of my grocery and household shopping at Super Target. I paid my balance in full each month, then they declined my card one day. I called customer service to find out why as the payment had already cleared my bank and I was at less than half the card’s limit. Target informed me they may place bank holds on payments for up to 10 days. Ridiculous, as they already have my money. I then asked for them to raise my limit so I could continue with my monthly shopping and avoid any time issues placed by their bank holds. The customer service rep told me all limits are set during periodic account reviews. Aka, I can’t do anything, it’s all done by computers. She was unable to clear the hold, request a review on my account, or do anything beyond pass me to her supervisor who was also unable to help me. Long story short, the Target card went into the filing cabinet and isn’t coming out. I’ll use my Amex with great customer service.

  71. Dirac says 16 May 2011 at 06:43

    Maybe I am missing something here but (1) most store cards have no associated annual fee and (2) the interest rate s 0.0 if you pay in full each month. Am I missing something?

  72. Pamela says 16 May 2011 at 06:46

    What still surprises many people is that opening a store credit card will lower your credit score. On average, it’s only about 3-8 points. But if you succumb to the discount offers a few times during back to school shopping or the holidays, you can see a pretty big hit.

    So I guess Neiman’s isn’t unique and exclusive after all. 🙂

  73. anon says 16 May 2011 at 06:52

    The sales representative should have told you that you were able to go to customer service and buy yourself a gift card (with your visa or mastercard) and use it for your purchase.

    • Tara says 16 May 2011 at 15:38

      The last time I tried to do that, they said it was only possible if your visa/mc was issued by a foreign bank.

  74. Elizabeth says 16 May 2011 at 06:57

    I like April’s hubby’s idea! I’ll have to keep that in mind.

    I’ve mostly stopped shopping in one of the largest retail chains here in Canada because of the constant pressure to sign up. Problem is, you only get their best sales and discounts if you have this card, and I think prices are inflated to compensate. (Plus I really hate it when the sales staff say “If you had signed up, you would have saved this much…”)

    I don’t have issues with credit cards, but I don’t want a whole wallet full of them. I wonder what happens to people’s credit ratings if they sign up for all these store credit cards?

  75. wanda says 16 May 2011 at 06:57

    Were you, buy chance, purchasing perfume? I am a perfume vendor for a major department store. I work with customers for large amounts of time – trying to find the perfect scent or gift. The worst thing that can happen is the customer walks away and says they’ll be back at another time. I do not then, get credit for the sale (which I have to call into my company each day). Even if you take my name, I do not get credit for the sale as I do not work for the store – I work for the perfume company. If you ask when I’ll be there next and purchase when I am there, I do get credit for the sale. You will know when you are working with a vendor when they hand the sale off to the store employee to ring. Before that, you’ll have no idea that the person you are working with is not an employee of the store. I think it was nice that you weere concerned with that aspect of the sale.

  76. Adam P says 16 May 2011 at 07:01

    Interesting, I’m sure I’ve shopped at Nieman Marcus in Austin Texas before (and I know 100%I’ve shopped at Nieman Marcus last call recently) without carrying anything but my cash back Mastercard. No Amex or Cash. Perhaps it’s a regional thing?

    I don’t like to open new cards for the anal reason that I am trying to get my “credit history” to be longer, as the only fault that comes up now on my report is that my accounts aren’t old enough on average.

    • April Dykman says 16 May 2011 at 07:47

      I think Last Call stores, like the online shop, are an exception to their Amex or NM card rules. Not sure about why they’d accept your MC at the Austin store–that’s the one I was at–unless they have changed something? :/

      • Adam P says 16 May 2011 at 07:57

        That’s so cool we were at the same store April!!! At the Domain? I’m not sure either, I used to have an Amex way back when, perhaps the last time I bought something there I used it and have been going to the Last Call stores ever since. It is a silly policy not to accept the big 2 cards tho, I bet they would have higher overall sales if they let in Visa/MC…but as you point out some companies make more profit on interest charges than they do on sales (Sears I think is the commonly cited one!)

        Great article, btw!

        • April Dykman says 16 May 2011 at 08:09

          Ha! Yes, The Domain. Thanks for the kind words. And I love Last Call, too!

      • DJ says 16 May 2011 at 18:52

        I was at a Last Call in Dallas on Saturday night, and I used my MC there. So I think April is right that Last Calls must take other cards.


  77. Katy @ The Non-Consumer Advocate says 16 May 2011 at 07:13

    Great post. I took my son to The Mall over the weekend so he could look for some “skinny jeans.” We found a clearance pair at Macy’s, and they were an additional 15% off if we used their in-store card. Luckily, the clerk was fine giving us the discount without having a Macy’s card.


    • April Dykman says 16 May 2011 at 07:49

      Now that’s really interesting. I’d never think to ask about getting a discount even though I wasn’t using their store card, but that just goes to show that it never hurts to ask!

    • amanda says 16 May 2011 at 10:47

      That’s funny- I left a purchase on the counter and walked away at Macy’s when they wouldn’t take my Macy’s card- there was a problem with the activation of the new card and it would not scan. The customer service rep and his manager acted like I had a stolen card or something (yes, I showed ID to prove it was mine). When I asked them to give me the 15% off and let me use another card they told me “no way”. That’s when I left the merchandise, called Macy’s when I got home and cancelled the card. I’ve been boycotting them ever since! Such a terrible experience. No more store cards for me!

  78. Justin says 16 May 2011 at 07:20

    The cash or Nieman’s card only adds to their (perceived) air of exclusivity. I live next to the first Nieman Marcus in downtown Dallas and a lot of high society type shoppers would probably be disappointed if they knew one of the great unwashed masses like myself came in and paid with a card I just used at Target 🙂

    • April Dykman says 16 May 2011 at 08:01

      Ha ha. Yes, you can figure out their target customer the minute you drive into the parking lot! I admit I was a little uneasy going there, but I was pleasantly surprised by how friendly everyone was, despite the fact that I wasn’t wearing a fur coat or carrying an Hermes Kelly bag. 😉 Unfortunate that their card policy had me walking out with such a bad taste in my mouth, but again, I know I’m not the consumer they’re after, anyway.

  79. No Debt MBA says 16 May 2011 at 07:25

    That’s an awful situation to be in. I just hope they have good customer service when you call to cancel!

    The only other store I can think of that has policies like that is Costco which if I remember correctly takes only AmEx or their store card, but you can still pay with a debit card which is way better than just cash or check.

  80. Coley says 16 May 2011 at 07:36

    Re: the profitability of the Nieman Marcus card business at an average of 15%, it’s always amazing to learn how much of the “exclusive” spending in this world is done by those who don’t actually have any money.

    • Betsy says 16 May 2011 at 11:15


  81. Ryan says 16 May 2011 at 07:50

    I’m probably crazy biased since I work retail and have to offer our card to every customer, but…

    I don’t get all the hate store credit cards get. If you don’t carry a balance, you pay no interest so the APR could be 80% and it wouldn’t matter. Whether I’m paying 28% on a Best Buy card or 15% on a regular AMEX, it’s still dumb to carry a balance.

    If you shop at a store you like, having their card usually has decent rewards.

    One question though:

    If April wouldn’t have been approved, then I guess they lose a sale?

    • Beth says 16 May 2011 at 09:24

      I don’t hate store credit cards, but I choose not to have them because I find it easier to deal with just one or two credit cards that cover most things I’d want to buy. It mean less tracking, and less avenues for identity theft and fraud. I like to keep things simple.

      Just a personal preference though as I don’t tend to make large purchases at big chain stores. I’ve found that things I want to buy — like clothes, housewares, etc — are the same price elsewhere as when you factor in the extra discounts. I hate places that inflate prices so you feel good when you get a deal (even though it’s only regular price elsewhere!)

      • Ryan says 16 May 2011 at 13:04

        Oh I agree, not wanting more cards for the reasons you listed is fine. Everyone has their preferences.

  82. Paularado says 16 May 2011 at 07:52

    I say, don’t beat yourself up. It’s really not a big deal. I’ve used store credit cards to save a lot of money on big purchases at Macys and Kohls. I never paid a dime of interest and I was never lulled into shopping there because of them. It’s a big so-what, and I think it’s really nice that you were thoughtful enough to want to ensure that the salesperson who helped you got the credit.

    • April Dykman says 16 May 2011 at 08:07

      My mom does the same thing with her cards. I think I was most annoyed because their policy pressured me into signing up for a card I didn’t want by taking away two major methods of payment that are accepted everywhere else. It just seems sneaky to me. When I’m asked if I want a store card anywhere else, I can politely decline and pay with my credit card.

  83. Hanna says 16 May 2011 at 08:34

    Best (or Worst) Scheme Ever:
    My fiance and I were walking through this mall in St. Louis that was half dead- it looked to have once been a grand and prosperous place, but now at least half the stores were empty and most the people there were powerwalkers avoiding the drizzle outside. This lady was standing nearby a little desk in the hall near a jewellry store, trying to get the few passerbys to look at her materials. When we passed, she asked if we would have just a minute to take a survey, so, mostly feeling sorry for her, we agreed. She asked “what’s your name? Do you have a job? Where do you live? Address? Now, what’s your social security number?” Excuse me?! The ‘survey’ was actually a credit card application for a store card with the nearby jewellry store! I kind of wonder if that’s not breaking some sort of rule, but I also wonder how many people, having got that far, felt too guilty to put a stop to it right there?

    • SEinSF says 16 May 2011 at 12:11

      That is just plain sleazy!

    • imelda says 16 May 2011 at 18:55

      That’s appalling, and totally underhanded. I would report them to the BBB.

  84. Claudia Lynn says 16 May 2011 at 08:48

    I hate how pushy some of the stores can be about the cards, drives me nuts. I understand they have to ask, so ask once and be done with it. I was recently asked at least 5 times if I was sure I didn’t want to sign up for the Kohl’s card. The salesperson kept telling me how great it was since I could save 10%! Even though I was only buying $15 worth of merchandise…and I hardly ever shop there.

    • Frankie says 18 May 2011 at 09:04

      As a once . . . and let’s face it, probably future retail worker I can tell you that whoever offered you a card five times had probably just been pressured to get credit applications at any cost. It’s constant, constant annoying pressure in that kind of environment and depending on the culture of the store it can make the difference in that associate’s pay as far as whether or not they get a raise, the amount of hours they get to work, etc.

      So, long story short, it just kind of sucks all the way around.

  85. Pete says 16 May 2011 at 08:48

    Thanks for bringing up this important subject. I share the experiences of others that were able to capitalize on opening a store credit card to get a discount. I purchased entirely new appliances for one of my rental units at Sears when Sears was having an appliances sale – opening the store card gave me an additional 10% off. Having opened the card and purchased the items at a significant discount, I haven’t used that card again at Sears. The only cards I keep in my wallet are an Amex and Mastercard, both of which give me points for travel – and both of which are paid off EVERY month. If there were a discount given at Sears or Macys that would require me to use their store card, the cashier could also look up my account online – but it seems once the account is opened at most stores, the discount offers go away

  86. El Nerdo says 16 May 2011 at 08:48

    @ April: way too much guilt. If you felt bad walking away, you could have just given her a hug and said “it’s not you, it’s me” or “I’ll always remember you.”

    • Nicole says 16 May 2011 at 09:08


    • April Dykman says 16 May 2011 at 09:11

      Ha! That’s hilarious. And you’re right about the guilt–it’s definitely a problem of mine.

      • El Nerdo says 16 May 2011 at 12:30

        Yeah. Just remember: Suicide–Never!! Murder.. ..Maybe…

  87. MutantSuperModel says 16 May 2011 at 08:49

    As soon as I saw you walked into Neiman Marcus I started giggling. It happened to me years ago but I put the item on hold and took out cash. I never bought anything at Neiman’s again though. I don’t think you made a huge mistake. Cut the card or freeze it. End of story. 🙂 You established the credit, might as well keep it with a zero balance. And yes Last Call takes all credit cards– it’s for commoners 😛

  88. Andrew says 16 May 2011 at 08:52

    “Back to my in-store experience: I was feeling cornered and conned.”

    You were neither cornered nor conned. You could have walked out–no one was holding you prisoner or threatening you. And you were not conned, unless it is your belief that every store should accept a card just because it is convenient for you. Neiman Marcus is under no obligation to make your life easier.

    This post is one long infantile whine.

    • April Dykman says 16 May 2011 at 09:15

      Yep, I said I “felt” cornered and conned, not that I was being held against my will. As I said in the article, one of my options was to walk out, but I caved in. I also said I know I’m not their target customer, but I did learn lessons from this that I hope will help others.

    • LC says 16 May 2011 at 09:15

      Haha – Neiman’s actually has outstanding customer service (in my experience) and I’ve never been offered or encouraged to sign up for one of their credit cards. I’ve heard them explain the benefits to individuals like the author who are without an AMEX or cash/check, and it’s pretty basic in laying out what payments they accept and what the alternatives are. Not a heavy sales pitch like you get at a lot of retail stores.

  89. Jamie says 16 May 2011 at 08:59

    Wow, I totally would’ve walked away without buying anything, especially since you knew what you wanted and could get it online.
    What a bad situation to be in!

  90. mapster says 16 May 2011 at 09:02

    I’ve never been to Neiman Marcus store, but if I were ever on vacation and one was available, I might be curious to check it out. However, now I know I will not actually ever buy anything there.

    Did you ever say how you know that the “we will not sell your info” turned out to be false.

    • April Dykman says 16 May 2011 at 09:26

      It’s in the cardholder agreement. There are several ways they share your information, and there are three ways you can opt out of if you call them. The blanket statement that NM (and actually it’s HSBC) doesn’t share your information is wrong. I would guess that your information is one part of why the private credit portfolios are lucrative, but that’s purely speculation. I haven’t researched the numbers on it. That said, I didn’t get the feeling she was trying to deceive me as much as I got the feeling that she didn’t really understand the terms herself.

  91. Greg C. says 16 May 2011 at 09:15

    I’m not a Neiman’s target customer, as you can tell by my following comment.

    I have store cards for stores where I shop that offer special discounts for card members, including what amounts to free clothing. Specifically I use Kohls, JCP, and Macys. They all send several coupons that are only good for card members and Kohls and JCP send free “cash” regularly. For example Kohl’s might have a sale that offers an additional 30% off with their card, plus $10 in cash for every $50 spent. So I might end up buying $500 worth of clothes for $200, plus get $40 coupons I will then turn around and use on “free” shirts/pants/socks/shoes/whatever. It works out for me, especially as I have a family with children who absolutely need new clothing several times per year, and stores like Kohl’s pretty much cover the needs for the whole family.

    The same goes for grocery store “customer loyalty cards.” I hate those things much more than I hate credit cards. However, there are some stores where prices are literally 2-3 times as high without a card, including some that are only worth shopping with a card in combination with a sale.

  92. Justin @ MoneyIsTheRoot says 16 May 2011 at 09:39

    I have been suckered more than once on opening a store credit account. It’s hard when the offer deep discounts for items that you planned on paying full price. I had opened accounts at Macy’s, Express, and GAP for their discounts on that one time purchase, and in the process I ended up buying more than I normally would have, all so I can recognize more savings! It’s not the wisest choice, especially after you find yourself with too many revolving lines of credit.

  93. sinyet says 16 May 2011 at 09:43

    A long time ago, in the 1970s, before I had any credit cards, I went into Neiman-Marcus in Dallas to buy a pair of shoes. I can still remember that they cost $36! I didn’t have the cash, so they offered me a store credit card. I doubted they would give me a card: I was young, out-of-state, and with no credit history. They asked if I had an ID. I had my NY driver’s license. That was enough for them to issue a card, and for me to buy the shoes. I was, and still am, amazed by the entire transaction. I paid the bill in full when it came, and still retain a soft spot for Neiman-Marcus.

  94. Tyler Karaszewski says 16 May 2011 at 10:28

    She *was* a great salesperson. She made you feel guilty enough that instead of walking out of the store, you opened a credit account you didn’t want just to spare her feelings.

    If that had happened to me, I would have asked where the nearest ATM was, and told them I’d be back in a few minutes with cash. I’ve done this before at other places that don’t take credit and no one’s ever been upset, they’ll set your purchase aside for you while you’re gone. If they still bothered me about it, or claimed there was no ATM nearby, I would have just left without making the purchase.

    Still though, nothing bad has really happened here. If you pay for the purchase and close the card you’re no worse off except for the time it took you to call and cancel. It’s not like this cost you hundreds of dollars.

    • Nicole says 16 May 2011 at 13:58

      Once my husband had to leave me as collateral at a crappy restaurant in Harvard square that has finally gone out of business. While I was waiting the waitress told me about one time when her friend left her baby as collateral at a gas station while she hit an atm!

      • Andrew says 19 May 2011 at 10:21

        Was it the Wursthaus? I hope not–it was never crappy, just strange.

  95. ThisIsWhyUBroke says 16 May 2011 at 10:37

    Everyone here trying to defend the use of store credit cards are obviously trying to “getrichslower” than you think…

    Its not even mathematically possible for everyone to pay off their credit cards each month or there would be no credit cards. Its also not mathematically possible for the 80% percent of people commenting in this post to all pay their cards off each month. 60% of americans carry a balance. Someone’s lying.

    • Tyler Karaszewski says 16 May 2011 at 11:06

      You are bad at math.

      Based on your own numbers:

      80% percent of people commenting in this post … pay their cards off each month.
      60% of americans carry a balance.

      Let’s assume all the commenters on this post are American for the moment (they’re not).

      The current US population is:

      If 60% of them carry a balance, that leaves 122,802,620 Americans who *don’t* carry a balance each month.

      So far, 71 people have commented on this post. If 80% of those people pay off their credit card balances each month, that’s 57 people who *don’t* carry a balance.

      You are telling us that it’s mathematically impossible for 57 people to pay off their credit cards each month because *only* 122,802,620 Americans pay off their credit cards each month.

      • ThisIsWhyUBroke says 16 May 2011 at 11:13

        Looks like we found the liar!

      • Nicole says 16 May 2011 at 13:56

        I believe the term is “selection bias.” Possibly “sorting.” GRS readers are not randomly selected and folks who comment on posts like this are not randomly selected.

        • Beth says 16 May 2011 at 14:11

          Agreed! I also think this post doesn’t lend itself to that kind of admissions. In the comments on other posts, you can see that people have had credit card debts or are getting out of credit card debt. This post doesn’t solicit that kind of conversation.

          I will cop to the fact that I once carried a balance for one month. (That’s ONCE in more than 12 years of credit card use.) It was a horrible feeling. In my family, you don’t put something on a credit card if you don’t have the money in the bank and the budget to cover it. I never really understood credit card debt until I started reading PF blogs!

      • Ash says 16 May 2011 at 19:14

        Awesome Tyler.

    • Paularado says 16 May 2011 at 11:15

      Huh? Math has nothing to do with it. It’s just the percentage of the population who is both reading and posting here at GRS.

      So, you’re saying we’re all lying? How ridiculous.


      • ThisIsWhyUBroke says 16 May 2011 at 11:36

        Lets add up the number of people who were honest enough here to admit they carry a credit card balance.


        Don’t worry I’ll wait…

        • DreamChaser57 says 16 May 2011 at 19:05

          You have a very combative / argumentative “in your face” style that on some level is appealing but on another takes away from the validity of your point. Your blog is even like that, ridicule, by your own admission, is a part of your strategy. I won’t even touch on the blatant misogynistic slant.
          I think a couple of things you’re not considering. The commentators of GRS are not representative of everyone who visits GRS, the lurkers. I think the most confident and by extension the most successful probably comment. Further, most people post anonymously so there is no incentive to misrepresent their fiscal lives. A common logical fallacy is to assume “what is true of the part, is true of the whole” – clearly the pre-disposition of GRS readers is different from the general population at large.
          To your point-I carry credit card balances. Not because I think that’s the thing to do, but we’re in the process of paying off our consumer debt.

  96. Sam says 16 May 2011 at 10:40

    I would have walked. I do have a store credit card from Pottery Barn which I used to buy $4000 in furniture.

    The reason I used a store credit card:
    (1) I already had the money saved up for the furniture;
    (2) they were running a special that gave me 0% on the furniture purchase (it was 0% for a year on purchases over a certain amount)
    (3) and as part of the special I received a $500 gift card that I used towards a new carpet.

    Then I paid off the balance in full shortly after. I toyed with the idea of keeping our funds in ING earning interest but I hate credit card debt, didn’t want to keep track of the payment and the interest rate at ING was too small (if I had been earning more in interest I might have reconsidered).

  97. DreamChaser57 says 16 May 2011 at 11:08

    I appreciate April’s transparency and candor tackling human side of personal finance.
    I also think women are hard wired differently and would have felt more pressure in this type of situation. I know I could completely empathize with April’s anxiety and frustration.
    As for store credit cards, I loathe them. I don’t care about the perks, real or perceived. I genuinely don’t believe the road to wealth is paved with perks from credit cards. I don’t want to be induced into getting a card by the 0% financing offer either. My household once got a Dell card once because I desperately needed a new laptop while I was in graduate school, I had taped my old one with electrical tape. We were on track to pay it off, an emergency came up which derailed our plans and we were retroactively charged all the interest. That’s life! I am still thankful that credit was a tool readily accessible to us. Yet, sometimes I feel credit, in any incarnation, stymies creativity and ingenuity when coming up with other solutions especially for people just getting a handle on their finances. My laptop was five years old, we should have started to fund a replacement fund and minimize the use of credit which would have made it easier and more likely to pay it off.
    Last point, I feel the retail industry has gotten too invasive. You cannot purchase anything without someone asking you your phone number, address; do you want a store card? Stores used to be in the business of selling merchandise not anymore they want a long term relationship and access to you now. I also hate when stores co-opt your info under the guise of asking for ID because you want to use your debit card, later I’m on their mailing list. Some store employees even get visibly frustrated because you don’t want to provide a blood sample -it’s maddening. Once, I was in a store where I was offered a card and I said I not interested in a 30% interest rate, the employee loudly proclaimed “that’s not true” she ran to the front counter to get clarification from a manager – and looked forlorn to learn I was telling the truth – so many people don’t know what their peddling.

    • Laura says 16 May 2011 at 12:04

      DreamChaser57, I agree 100%. I’d only add that besides the road to wealth not being paved with perks from credit cards, IMHO the road to Hell is paved with the credit cards themselves.

      I’m sympathetic to April’s situation, and I probably would have done exactly the same thing – she had to go to another appointment in 15 minutes, she’d made an effort to get to that particular store, and the salesperson, who needs to make a living off her commission, had really taken the time to do her job fully. But I would have felt just as irate about getting suckered into a store card.

      Still, no harm done in this case.

    • Chase says 16 May 2011 at 12:12

      Women do succumb to the pressure more easily than men. I work at American Eagle and our deal is apply for a card and get 15% off your purchase. And it’s far easier to get women to apply than men. The women that say no are many times still considering it, whereas most men without hesitation give a stone cold ‘no,’ the same no that I give when I’m shopping.

      Sometimes I have to try not to laugh when someone makes a purchase of $10-20 and applies for a card to save $2-3. Honestly?

      I used to feel guilty working for the bad guy offering credit cards to anyone over 18 with a SSN and an ID, but now I feel like people need to be their own financial stewards. I certainly don’t have time to do it. I struggle with my own finances as it is!

  98. Dave says 16 May 2011 at 11:14

    Let me get this straight… the salesperson told you that they don’t take Visa or Mastercard, but they DO actually take those? If I’m reading it right, then that salesperson LIED to you. I would have gone to the manager, told the whole deception story, and demanded that salesperson be fired.

    • Chase says 16 May 2011 at 12:13

      Lol, you’d have wasted your breath.

    • LC says 16 May 2011 at 14:47

      The salesperson didn’t lie. Neiman’s does not take anything but it’s own store card, AMEX and debit cards. Last Call, Neiman’s discount store, may take all cards.

  99. Caitlin says 16 May 2011 at 11:39

    I got duped into signing up for a store credit card once too. I was fresh out of high school and had only been at college for about two weeks.

    In my case, I didn’t even know it was a credit card at the time, due to a lack of real-world experience. The salesperson called it a “store card”, and it never occurred to me that this meant “store credit card”.
    It wasn’t even at the register, it was at a booth in the front of the store when you first walked in. I’ve never been good at dealing with unknown situations or strangers (and was, of course, worse when I was 18 and out on my own for the first time) so I even though I didn’t want this “store card” thing to begin with, I filled out the form so the person would stop talking to me and let me continue shopping in peace.
    I was so humiliated when it arrived in the mail and I realized it was a credit card that I made sure to never sign up for a store card again. So far so good.

  100. J.D. says 16 May 2011 at 11:42


    We get it. You don’t like credit cards. Nobody here is advocating that people should get credit cards if they can’t use them responsibly.

    HOWEVER, contrary to your rants, there are people who do use them without issue. My wife has used credit cards for twenty years and never gone in debt. Since I returned to the world of credit four years ago, I haven’t carried a balance. It is possible to do this, and I have no doubt that many GRS readers are responsible enough to make it happen.

    So please, ease up.

    • Elizabeth says 16 May 2011 at 12:10

      Kudos, J.D.!

  101. Stan says 16 May 2011 at 11:52

    I did not know anyone still took paper checks.

    • A.J. says 16 May 2011 at 12:45

      If you ever go to a Wal-mart and/or a grocery store while in any sort of hurry, the person in front of you will gladly remind you that the store does indeed take paper checks…

      …not that I have any experience with that or anything…

      • LC says 16 May 2011 at 14:49


      • Andy V says 19 May 2011 at 08:20


      • Andrew says 19 May 2011 at 10:25

        They also take pennies–many, many pennies–

  102. Young'n says 16 May 2011 at 12:02

    I find it odd that April doesn’t mention that by opening a credit card and closing it almost immediately her credit score will take a hit. Couldn’t you just buy the girl a latte?

  103. Florida Bill says 16 May 2011 at 12:12

    April wrote: “It was the only in-person store that carried the Stuff I wanted, …” The emphasis was on Stuff (hence the writer’s capitalization within the sentence), when it should have been on WANTED. Not NEEDED, but WANTED.

    So the purchase was not a necessity but a want and the buyer was not in need of the item.

    Walking away without signing up would have been proper.

  104. Rachael says 16 May 2011 at 12:42

    It’s inexcusable for a large, upscale store like that to not accept major credit cards. That being said, as someone who worked at a large department store in high school and college, I was required to offer the credit card to customers. In fact, we were mildly scolded if we didn’t offer it or didn’t open enough accounts. They also gave us $2 cash up front in the store office for every application form we turned in, so there was some small incentive. Many of the moms working in the store would get their $2 or more and say that was their kids’ lunch money for the next day/week/etc. I don’t condone pushy behavior, but just wanted to provide perspective from the other side. We were under major pressure to open new accounts. I generally just politely say no when offered a store card anywhere nowadays, and that seems to do the trick.

    • LC says 16 May 2011 at 14:54

      As I commented earlier: I’m fairly certain the reason behind accepting one card exclusively is they then have discounted merchant fees from AMEX exchange for exclusivity for the AMEX receiving the CC fee profits.

      The vast majority Neiman’s targeted clientele carries AMEX, which is why this arrangement works. They target a very specific demographic in their business model. It likely wouldn’t pay off to accept all other forms of payment, given the trade off of higher AMEX fees in addition to other CC fees, for a relatively insignificant increase in business from persons who do not carry AMEX.

      So, if you don’t like it, shop else where. Neiman’s obviously isn’t hurting for business as a result of not accepting other cards.

  105. RC says 16 May 2011 at 12:57

    American Express and Discover are not fully accepted at some international locations. Visa and Mastercard are much more commonly accepted in Europe. I found out the hard way on my first trip to Europe when Discover was my only credit card and no one would take it. I had to do some bank transfers to put enough money on my Visa debit card and use it like credit that time.

  106. Lily says 16 May 2011 at 13:17

    I use to work as a sales associate for the flagship Victoria’s Secret store in New York City and our managers put daily quotas of store card applications on us. Managers told us regardless of whatever the customer tells us (bad credit/no credit) to push it anyways and run an application through the system. I hated pushing the store cards on customers and I never filled one quota (but I was a great sales girl!). No surprise, I ended up leaving. Just a point of view from the other side of the counter!

    • Rosa says 16 May 2011 at 14:46

      When I worked retail, we got same-day cash bonus for store card applications. It wasn’t much, but one day a pregnant coworker really needed to go home and lay down, and didn’t have cab fare, so all of us signed up for cards through her so she could get cab fare to go home.

      I think I left that card open and unused for a decade before I finally went through and cleaned up all the random crap on my credit report.

  107. Brenton says 16 May 2011 at 13:22

    “I was reminded that I should carry at least one paper check with me.”

    This is a terrible idea for all sorts of reasons. You are far better off just carrying a wad of cash. If you lose your wallet or its stolen, even the most dim witted criminal could steal $1000 in the blink of an eye with that blank check.

    • Paularado says 16 May 2011 at 14:29

      Really? I carry my checkbook in my wallet. I always have. If I lose my cash, it’s gone for good. If someone forges a check, I get it back.

      • Brenton says 16 May 2011 at 16:24

        True, you would probably get the money back eventually, but it would be quite the hassle to have a zero or a negative balance for a short period of time. Not to mention the possibility of returned checks or ACH transfers. Plus, the guy would have your name, address, account number and bank routing number. Setting himself easily for more mischief down the line. A dimwit could make life annoying for a couple weeks with a blank check. A clever, professional thief could force you to close your account and cost you plenty in fees that would never get back.

        With cash, its a fixed risk. You have $100, the most you can lose is $100. Most people rarely if ever lose their wallets or get robbed, so losing $100 once every 20 years isnt going to hurt much.

    • Nathan says 17 May 2011 at 08:40

      I agree – losing a check gives the finder an opportunity to steal a large amount from your account. I keep a $100 bill in the back of my wallet, separate from other cash, for “opportunities” like this. Since it’s a single bill, I’m less likely to break it in order to spend it on impulse. If I do lose it, I’m out $100, but there’s no additional exposure like with a check.

  108. Jenna, Adaptu Community Manager says 16 May 2011 at 14:59

    That is a tough situation to be in. Aside from putting something on hold and running to the ATM what else could you have done. On the bright side, you got a discount and can just shred the card when it arrives in the mail (after you pay of course).

    • El Nerdo says 16 May 2011 at 15:55

      I think of “a tough situation to be in” as having to euthanize your dog or being unemployed or not having enough food to feed your kids. Tough situation.

      Having to say “sorry” to a salesperson in an upscale department store and come back another day or going to buy the thing online isn’t a “tough situation” except maybe in the world of Paris Hilton.


  109. Jeff says 16 May 2011 at 17:19

    I learned a lesson about store cards a couple of months ago. For months, I had wanted to buy a sport coat. I looked everywhere and finally found it at a local department store. Long story short, I could get it for $29 if I opened the card. Needless to say I relented.

    Here is the lesson part. We do not have any debt except our mortgage and car payment and everything (utilities, cable) are paid automatically. So, I totally forgot about paying and when I did it was late. There was a $25 late fee. I probably could have called customer service and begged forgiveness, but I decided to pay it and call it like Dave Ramsey says “a stupid tax” Needless to say, I do not have the card any more.

  110. Jess says 16 May 2011 at 18:01

    How strange. Last summer I purchased some shoes at Neiman Marcus and they let me, in store, purchase them with a Visa card.

  111. average guy says 16 May 2011 at 20:42

    >>Last week, I ventured into Neiman Marcus for the first time.

    That was the first mistake.

  112. Karin says 16 May 2011 at 21:25

    Thanks for sharing this story. Personally, I have NEVER had a store card and never will. I would have walked away. Indeed, a couple of years ago I tried to buy a $200 shirt which was marked down to $140 in a large (Australian) department store, and was told the discount was only available if I signed up for a card. I declined. Their loss!

  113. Karen in MN says 17 May 2011 at 01:49

    I have a ton of store credit cards—I got them all 20+ years ago when I was trying to build credit so I could get a Visa or MasterCard (in those days, you couldn’t get a major credit card unless you already had some credit history). I used the store cards for some small things for a few months and then paid them off and never used them again.

    I never closed any of the store cards, they don’t have annual fees, and they still show up on my credit report–where they boost my credit score. And nope, no fraudulent charges in 20 years.

    That said, I refuse to get any new store cards now. I would have walked out of N-M without paying, giving up my purchase. I hate it when stores jerk you around like that–My view is that I’m doing them a favor just by shopping there, not the other way around!

    The Sam’s club here only takes discover or debit cards, which I don’t have—such a pain. But they will take checks so that’s what I use when I go there. If they didn’t take checks, I’d just stop shopping there.

  114. Honey says 17 May 2011 at 09:03

    I have a Gap card. I thought really carefully about this but I shop there ALL THE TIME – their clothes fit me better than any other retailer (and I am including things like bras and panties, things you can’t buy used). I have never carried a balance and earned hundreds of dollars in free merchandise over the 10 years or so I’ve had the card. So it was definitely worth it for me.

  115. Flaneuse in DC says 17 May 2011 at 09:17

    Bastards! I’m sorry N.M. got you, though I do understand how you could feel an indebtedness if you’ve spent a lot of a salesperson’s time. The same thing actually happened to me in the Needless Markup store in DC a few years ago. I was just trying to buy a lipstick, for crying out loud. And the policy is so snotty: “We don’t take debit cards.” They must’ve made a pitch to apply for the store card, but if so I don’t remember. I didn’t make the purchase, but more out of bewilderment; the outrage only came later. Remembering it makes me want to go back, spend a lot of time looking at stuff, and try to buy something with my debit card — just so they can give me the rap and I can say “Kiss my *ss”.

  116. Linda says 17 May 2011 at 11:59

    Way back in 1985 I had a similar experience in the flagship Macy’s store in NYC. I was in NYC on a weekend trip with my boyfriend and was trying to buy some very necessary articles of clothing. (Our luggage had been stolen the day before, so I literally had only the clothing on my back.) When I got up to the register in the Macy’s lingerie department I presented my Mastercard (the only credit card I had at the time) and the salesperson told me they only accepted Macy’s cards. I was surprised that she was OK with accpeting a check from out of state, but that’s how I had to pay. After that exchange I left Macy’s and went to Gimbel’s down the street to buy the rest of the clothing I needed.

    As an aside, after that trip I hated NYC and vowed to never return there again. Nearly two decades later I found myself traveling to Manhattan quite a bit for work and grudgingly decided it was actually a pretty cool town. Now I like it; but I’d still never want to live there. 🙂

  117. BB says 18 May 2011 at 04:10

    Store cards: I have Macy’s and Nordstroms. Using them wisely, I save $.

    Macy’s sends coupons like $10 off a $30 purchase.
    Nearly always using the Macy’s card gets me 15% off my purchase. Nordstrom’s gives me 1% back in the form of a gift certificate (after I spend $2000; the balance carries from year to year so it’s never lost) and private sale days to shop.

    It goes without saying I pay in full each month.

    What did you need for $60 in Needless-Markup anyway?

  118. Brian says 18 May 2011 at 12:39

    I might have handed saleswoman#1 a $10 bill for her help and walked out, to later purchase the product from a company less interested in coercing/extorting me into a credit app.

  119. Paula says 21 May 2011 at 19:13

    Still not quite getting what the big deal was about opening the card. Pay it off and just don’t use it; it sounds like you don’t go there often anyway.

  120. Kate says 25 May 2011 at 08:20

    This is why I don’t shop at Neiman Marcus. I had an AmEx ages ago and it was a lot of trouble, and I have gotten rid of it. I go to NM sometimes because one of my networking groups meets there and for a $5 donation to a charity I can get samples of face creams, etc. from a reception in the cosmetics department. I have made one purchase there, just once, and I only bought half of what I intended to buy because I only had that much cash.

    NM is a very successful business, and I definitely see the business angle of not accepting V/MC, because pushing people to buy with a store card generates significant reliable revenue.

  121. Terence says 03 December 2012 at 17:50


    Lesson learned… And I hate that stupid girl who pressured me into potentially ruining my near perfect score…

  122. Tasha says 18 December 2012 at 15:57

    I was thinking about opening up a store credit card and Now that i seen this i dont think so

  123. samuel says 06 February 2013 at 06:41

    I do not use a credit card,never did in my life.

  124. Kate Jurman says 06 April 2016 at 05:50

    “Lesson learned… And I hate that stupid girl who pressured me into potentially ruining my near perfect score”

    I ran into this blog while searching for ways to actually get customers to apply for credit cards at my store. This “stupid girl” who happens to be a store manager, with 2 college degrees…. has a mandatory goal of 4 credit applications in one week… and I can’t get them, despite every effort on my part. Quite possibly because of the reasons above! That I can’t say whether I agree or disagree with but, I’m an educated consumer just like the rest of you, with only major credit cards.
    Please don’t blame it on the person behind the counter. It’s a mandated part of their job, and if they don’t fill their quota, they’re out of a job. And please know that not all stores play as dirty as Neiman Marcus, some do actually reward their customers, and some stupid girls would never lie to a customer or pressure them into applying for anything that they didn’t want.

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