Retail Credit Cards Interview with KGMI Radio Bellingham, WA
CreditCards.com Senior Industry Analyst Matt Schulz spoke on Monday, October 19, 2015 with Joe Teehan of KGMI Bellingham, WA about the October 2015 Retail Credit Cards survey. The interview and transcript are below.
Joe Teehan: When that retailer offers you their credit card with some enticements, should you accept and sign up for that store-branded credit card? And joining us with some words of warning this morning is Matt Schulz. He’s CreditCards.com’s Senior Analyst. Good morning, Matt. Good to talk to you again.
Matt Schulz: Same here.
Teehan: You say these cards can charge some pretty hefty interest rates.
Schulz: Yeah, the average retailers credit card charges an interest rate of 23.43%, and that’s a whole lot higher than the national average for all credit cards, which is about 15%.
Teehan: Wow, Zales for instance you say charges 28.99%. Staples, 27.99%.
Schulz: Yeah, and those two in particular are about the equivalent of what your average credit card charges as a penalty rate to people who’ve been 30 or 60 days late with a payment. So it’s really, really high.
Teehan: No wonder they want to get us all signed up.
Schulz: Yeah. And really the important thing to remember is if you carry a balance, these cards probably just aren’t for you. Because even though a lot of them come with rewards and discounts, the math just doesn’t work in your favor when interest rates are that high.
Teehan: I’ve got just a couple of these and I tend to use them only when I know, ok I’ll be able to pay this off at the end of the month, I’m not going to charge a whole bunch. But they give you some pretty good discounts if you do use your card.
Schulz: They can work out for you if you pay off your balance because they do offer 15, 20, 25% off and some retailers even have tiered rewards where the more you spend, the better rewards you get. But you just have to be careful because the last thing anybody wants to do is overspend to just get rewards.
Teehan: Yeah, then ultimately the more cards you have, the harder it is to keep track of them all.
Schulz: It really can be difficult so one thing that you may want to do is start a list of all of the due dates and keep track of all those cards that you have. Or setting up autopay through your bank is a good idea, too.
Teehan: And as you say, good idea to pay off those balances each month. Matt Schulz is CreditCards.com senior analyst. Thanks for being with us this morning, Matt.
Schulz: Thank you.