Store cards are an incredibly dangerous way of borrowing. This cannot be overstated. Many store cards will have an interest rate of 25%, some even as high as 30% – this is significantly higher than even the most expensive credit cards.
What is a store card?
Store cards are like credit cards in the sense that you can make purchases which you then pay back at a later date. However, you can only use them in one specific store. If you get a Debenhams store card, for example, you can only spend it in Debenhams throughout the country and online (this is perhaps a blessing considering the sky-high interest rates).
Why are store cards a problem?
Store cards are a problem as many people just do not know what they are getting into. There aren’t really any credit checks, the staff who offer them likely don’t understand them either but are under pressure to sign people up, and tempting offers like instant discounts off purchases make them difficult to refuse if you’re short on cash.
When people don’t fully understand the commitment they are taking on, a split decision to make some money can turn into a serious debt problem.
How you can use a store card to your advantage.
As dangerous as store cards are, there is undeniably an opportunity to save some money. However, this is undoubtedly playing with fire; it is essential you pay off what you owe straight away and never use the card again. Consider even cutting it up with scissors.
- Choose what you want to buy
- Get the card, and the complimentary discount
- Pay it off, and don’t use it again
If your income is irregular, or if you think there is even the slimmest chance that you might not be able to make the payment when the time comes, do not get a store card. The money you are likely to save with the discount is not going to be anywhere close to the amount you’ll pay in interest if you can’t keep on top of your store card payments.
Do you have unmanageable store card debt?
If you have found yourself as a victim of store card debt, then get in touch today let’s tackle it together. We have many ways of helping you deal with unsecured debt, and in many cases, we can set up an arrangement which allows you to write the vast majority off.
Addressing your money trouble can be difficult, but it is only going to be worse tomorrow. Give us a call now on 0800 808 5124 or fill in our debt calculator (it takes no time at all!) and one of our knowledgeable and friendly advisers will be in touch soon.