Retail Credit Cards Interview with KSL Utah
CreditCards.com Senior Industry Analyst Matt Schulz spoke on Friday, October 16, 2015 with Debbie Dujanovic of KSL Utah about the October 2015 Retail Credit Cards survey. The interview and transcript are below.
Announcer: In tonight’s consumer file, a warning about store credit cards. They may seem like a great deal when you go to first sign up, but as KSL Investigator Debbie Dujanovic found when she went shopping, they could sting your household budget.
Store Employee: Save five percent every time you shop at Target.
Debbie Dujanovic: Cash back on purchases, extra discounts at the register, rewards points. You know, store credit cards can be enticing until you get dinged with high interest charges. I hit the mall, went into five different stores to get credit card applications, and found that four of the five charged almost 25 percent interest a year. So let’s say you have $1000 card balance at your favorite store. Making the minimum payment with an annual percentage rate of about 24 percent, well it would take you six years to pay it off. And, you’d have to pay almost $850 in interest on top of that $1000 you spent. And that’s why Matt Schulz wants Utah shoppers to be aware.
Matt Schulz: You got to be super careful, because the last thing anyone should ever do is overspend in order to get more rewards, ’cause that’s just asking for trouble.
Debbie Dujanovic: KSL investigators spoke to Matt by Skype. He’s a Senior Analyst for CreditCards.com. His company says, in a recent survey of store cards, a popular jewelry retailer charged the most at almost 29 percent annually. And 66 percent of stores charge around 20 percent interest a year.
Matt Schulz: You’re talking about hundreds, possibly even thousands of dollars in extra interest that you would pay compared to the average credit card’s APR, which is about 15 percent.
Debbie Dujanovic: So here are three things you should know. If you’re going to apply for a store credit card, make sure you read through the application. The interest rate is printed right on it. Next, if you’re gonna carry a balance on your credit card, CreditCards.com suggests than a store card probably isn’t for you. And third, check in with your bank. You might find they offer a much better rate. Debby Dujanovic, KSL 5 News.