Does it make sense to get a branded or store card?
Running Point and its senior financial advisor, Liz deSousa, were quoted by Fortune Recommends in an article — by Ivana Pino, “Retail card APRs are on the rise. How to know if you should get one anyway” — regarding the temptations, perks, and risks of using a store or branded credit card.
Branded and store cards are on the rise! Are they ever a bad idea?
Expect to see more branded and store card offers over the next few years as financial-technology (fintech) companies such as Marqeta and Power Finance market white-labelled credit card issuance programs that allow companies to gain robust consumer insights. These platforms are designed for companies, brands, and even banks to offer customized credit card programs with targeted services, personalized promotions, and easily redeemable loyalty rewards, all integrated into mobile and web applications. Imagine banking with your favorite brand!
Pros of getting a brand or store card for an individual may include exclusive discounts and promotions, rewards for purchases, and the potential for earning a higher credit limit with responsible use. Cons can include higher interest rates compared to other credit cards and the temptation to overspend on unnecessary purchases to earn rewards or take advantage of promotional coupons.
Store and brand cards can be a bad idea if you have difficulty managing credit and may overspend, or if the interest rate is high and you are unlikely to pay off the balance in full each month. For some people, acquiring additional cards may make it harder to track expenses which can make managing or budgeting more difficult.
Quoted article excerpt is below:
“It may make sense to get a store card if you frequently shop at that store and can take advantage of exclusive discounts and rewards offered by the card or if you are doing a single large purchase and can receive a sizable promotional discount for signing up for the card,” says Liz deSousa, certified financial planner, CDFA, and Senior Financial Advisor at Running Point Capital Advisors.
“As a child, a library card takes you to exotic, faraway places.
Sam Ewing — He batted left and threw right —
When you’re grown up, a credit card does it.”
former baseball player for the Chicago White Sox and the Toronto Blue Jays.
Disclosure: The opinions expressed are those of Running Point Capital Advisors, LLC (Running Point) and are subject to change without notice. The opinions referenced are as of the date of publication, may be modified due to changes in the market or economic conditions, and may not necessarily come to pass. Past performance is not indicative of future results. Forward-looking statements cannot be guaranteed. Running Point is an investment adviser registered with the U.S. Securities and Exchange Commission. Registration does not imply a certain level of skill or training. More information about Running Point’s investment advisory services and fees can be found in its Form ADV Part 2, which is available upon request. RP-23-10
