The Dangers of Deferred Interest On Store Credit Cards

November 23, 2016

© Zentilia | Dreamstime

The shopping centers will be packed Friday as many of us will be out shopping and even after dropping, shopping some more.  However beware of the one item most retailers will be enticing you to get and that's their store credit card.  Retailers take the opportunity this weekend to boost up their credit card numbers by offering price reductions and deferred interest if you open a charge account.  While you may tell yourself you can pay off the card before interest is due or pay it off during the deferred interest period, know what consequences await you if you don't.  Many store credit cards have high interest rates of over 20% and while you may not have any payment or interest due, the interest accumulates and if you have a $1 balance when the promotion ends, all that accrued interest is due and that could be hundreds of dollars.  Personal finance web site WalletHub analyzed financing options from 75 large retailers, over two dozen major retailers offering what it called “dangerous” deferred interest programs.  Although not all store credit cards are bad, many do offer perks like free shipping and even offer money back on store purchases.  If you decide to take advantage of a store credit card offer, don't be rushed and read the terms before applying so that you fully understand the offer.

SOURCE: WalletHub

See and hear more from the 98.5 KTK Morning Show with Storm, Janie and Chris