topic Re: Store cards- the argument for closing in Credit Cards

Store cards- the argument for closing

jetsfan2013 — Fri, 16 Oct 2020 15:18:31 GMT

A friend told me that he "outgrew" retail store cards and closed all of them (he had 4). He now exclusively has Amex and Citi (Double Cash, Gold and Hilton Aspire).

What is everyone's thoughts around saying no to store branded retail cards?

Re: Store cards- the argument for closing

K-in-Boston — Fri, 16 Oct 2020 15:40:43 GMT

If growing up means getting fewer rewards at stores I shop at anyway, then I don't wanna grow up. (And since I'm paraphrasing a toy store commercial from the 80s, I'm probably grown up anyway.)

If one has unused store cards from building/rebuilding their credit profile, then usually no problem with closing unused cards. But if a consumer regularly shops at those stores, the rewards and/or promotional financing are generally hard to beat by non-store cards. Chase Sapphire Reserve may be a "grown up card," but it's generally going to give me less in rewards than my 5% Amazon card, less of a discount than my Kohl's card often will (up to 30%), less than 5% off at Target, etc.

Re: Store cards- the argument for closing

blindambition — Fri, 16 Oct 2020 15:57:41 GMT

I don't believe in keepping cards that aren't being used. Except if it happens to be your oldest card. Sometimes stores go in a direction we no longer like, or were in a different life phase. I certainly wouldn't keep them. Why manage them when they serve no purpose.

I have a Target RedCard which switched to MC and a Best Buy Visa. Stores I shop often, but cards are useful other places. I really wouldn't consider a store card without additional value.

Re: Store cards- the argument for closing

wasCB14 — Fri, 16 Oct 2020 16:05:27 GMT

I closed my Brooks Brothers card when I moved and went from two nearby stores to zero. The card's value was focused on in-person shopping.

At some retailers a store card is somewhat mandatory if you shop often. It can be less about "rewarding loyalty" and more about the illusion of savings or fleecing infrequent customers.

I like to shop at Costco as much as possible, where the "original" price is generally an attractive one and the promotions represent real discounts.

Re: Store cards- the argument for closing

fatcomic — Fri, 16 Oct 2020 16:20:27 GMT

I agree sometimes the value of a store card is additional % off (Amazon Prime card or Lowe's 5% off everyday, or they offer 0% promo financing). It might give some AZEO folks heartburn but I will put a refrigerator on my Lowe's card for 12 or 18 months with 0% or if I have the cash in the bank, I'll put it on there to deduct an additonal 5% off at the register.

I have a Shell gas card, I used it for several reasons, the first was 5 cents off a gallon when you used it, secondly for pay at the pump skimmers, the main reaon is becasue there is a Shell station down the road from my house and I buy most of my gas there. My thought was about the skimmer, there isn't much they are going to be able to do with a closed-loop Shell credit card number if they did end up stealing it. However, I've since got cards with better cash back than 5cents, so I don't use it except when I fill up my gas can for the lawn mower just to keep it open. I'm a credit card hoarder I guess.

Re: Store cards- the argument for closing

Anonymous — Fri, 16 Oct 2020 17:30:47 GMT

I think the store card vs bank card distinction can be overstated here, partly because rebuilding tends to go from cards you can get but aren't useful to you (Fingerhut, some shopping cart trick cards) and, once profile improves, to "real" cards such as those from the big banks, so the latter feel better and you have "progressed"

To me, the question for each card is whether it is useful (and as good or better than alternatives) for my spend. So, the only place store cards are worse is if the store stops meeting your needs (the store changes, your needs change, you move away from the store area etc) and the card becomes useless, whereas a bank card can continue to be used. However, it's not much of a distinction. I use my US Bank REI card at (wait for it) REI. If for any of the above reasons I stopped buying at REI, while I COULD use the card elsewhere, I probably wouldn't, as I have better cards for any non-REI purchase!

Re: Store cards- the argument for closing

AverageJoesCredit — Fri, 16 Oct 2020 18:46:54 GMT

Why say no when saying yes feels so good?

Re: Store cards- the argument for closing

dragontears — Fri, 16 Oct 2020 18:54:14 GMT

I closed my one and only store card (well it was a MC store card) a few years ago because I moved and there was no stores near where I moved to.

My personal view on store cards are if they give you good benefits/rewards at a place you normally shop than they are good for you, when you no longer get good benefits/rewards from them you should close them just like any other card that is not useful for your spend.

Re: Store cards- the argument for closing

BmoreBull — Fri, 16 Oct 2020 19:33:07 GMT

I have 3 store cards VS, Express, and Kay's. The only thing I don't like about them is they can report kind of random. I use the cards, pay them off as soon as the balance shows in the account, and they still report the balance like I never paid it. Other than that they are low limit cards that haven't grown for me. I was actually just contemplating closing them. The VS and Express card, are both $250. I figured I could just app for one good bank card that would replace both of those cards.

Re: Store cards- the argument for closing

rostrow416 — Fri, 16 Oct 2020 19:50:44 GMT

If the card has value to you, I don't see why there would be a need to close it. I also never saw the point in collecting store cards from every store I've shipped at, ever. But I definitely have use for, or value for, my Amazon, Target, and Walmart store cards. I can't beat 5% back any time with any major credit card. But there are too many store cards that offer little to nothing, or, outside a single purchase, would see no use.

Re: Store cards- the argument for closing

pinkandgrey — Fri, 16 Oct 2020 20:14:41 GMT

I generally avoid store cards unless it's usable outside the store (i.e Best Buy Visa).

Re: Store cards- the argument for closing

coreysw12 — Fri, 16 Oct 2020 20:17:05 GMT

I don't like having bunches of store cards for places I never shop at or that don't offer good incentives. But there are a few I'd like to get, because they offer 5% discounts or cashback at places I regularly shop anyways:

REI
Lowes
Amazon

Besides that, I'd rather avoid the hassle. It's usually not worth the effort (or money) to use the card often enough to keep them from closing it.

Re: Store cards- the argument for closing

tcbofade — Fri, 16 Oct 2020 20:20:12 GMT

@K-in-Boston wrote:
If growing up means getting fewer rewards at stores I shop at anyway, then I don't wanna grow up. (And since I'm paraphrasing a toy store commercial from the 80s, I'm probably grown up anyway.)

Doubtful.

DW and I still have a few store cards.... we keep Target for the 5% discount, NFM for the zero percent financing, and we both have Lowes cards for the discount OR the financing.... depending on the purchase.

If they work for you, keep them. If they don't, don't.

Re: Store cards- the argument for closing

jetsfan2013 — Fri, 16 Oct 2020 21:03:45 GMT

Can store branded cards with low CL impact other larger issuers from extended larger CLI?

Re: Store cards- the argument for closing

K-in-Boston — Fri, 16 Oct 2020 21:14:23 GMT

@jetsfan2013 wrote:
Can store branded cards with low CL impact other larger issuers from extended larger CLI?

"Low limit hell" is a common phrase thrown around. On the surface, it often appears that low limits beget more low limits, but those limits are often determined by one's credit profile including income and recent credit-seeking, so correlation does not necessarily equal causation.

Even with average revolving credit lines around $25,000 or so, I've had approvals as low as $2500 (Citi Premier) in the past few years. Even though I have a card that I purposely decreased to only $500, I've had a number of approvals with starting lines in the $20-40k range.

So yes, if one's credit profile has a number of new accounts mostly for small limit store cards, it can affect starting lines depending on the lender. But the same can also be said about a number of new accounts with much larger starting lines.

An important distinction was made earlier in the thread. Having a bunch of low dollar store cards one never uses because those are accounts they could be approved for is seldom a good idea. But having a handful of store cards if one regularly shops at the retailer and makes use of discounts or promotional financing is just good financial sense.

Re: Store cards- the argument for closing

Anonymous — Fri, 16 Oct 2020 21:34:39 GMT

@jetsfan2013 wrote:
Can store branded cards with low CL impact other larger issuers from extended larger CLI?

I feel like there's just as many DPs of someone with low limits getting big limits and the other way around

Bigger factors would be how often you apply/attain new credit, income, deposit activity (with the credit-issuing bank), etc.

Re: Store cards- the argument for closing

SunriseEarth — Sat, 17 Oct 2020 04:01:59 GMT

@jetsfan2013 wrote:
A friend told me that he "outgrew" retail store cards and closed all of them (he had 4). He now exclusively has Amex and Citi (Double Cash, Gold and Hilton Aspire). What is everyone's thoughts around saying no to store branded retail cards?

Some people would say they've outgrown Citi. Honestly, it depends on what works for your profile and your needs. Many store cards have worthy perks, such as increased rewards or special financing, that are desirable at any credit level.

Re: Store cards- the argument for closing

sxa001 — Sun, 18 Oct 2020 00:33:51 GMT

I don't believe in closing cards on my own anyways that don't have an AF. If they get closed for non use so be it. I only have two store cards. I did get lucky with the Dillard's AMEX as I can use it outside of Dillard's but the limit is really terrible (I never tried to increase it). I will likely eventually be downgraded to their regular tier card since I decided to stop being a shop-a-holic*.

My Blue Nile will likely eventually be closed, since I have received CLIs from other cards I am not worried about losing the 9K in credit when that happens.

* To give an example of my Dillard's addiction, one afternoon I was with a friend of mine and he wanted me to swing by the Best Buy, I naturally ended up in the Dillard's parking lot and honestly didn't even think about it until he reminded me we were going to the Best Buy.

Re: Store cards- the argument for closing

AverageJoesCredit — Sun, 18 Oct 2020 12:58:40 GMT

@Anonymous wrote:
@jetsfan2013 wrote:
Can store branded cards with low CL impact other larger issuers from extended larger CLI?
I feel like there's just as many DPs of someone with low limits getting big limits and the other way around

Bigger factors would be how often you apply/attain new credit, income, deposit activity (with the credit-issuing bank), etc.

This. I dont think just because one has 4 $500 cards they wont get a $10k card elsewhere. Same as high limits dont gaurentee high limits. Jusr ask those HIErs about that first limit with Navy lol. We are outliers here on myFico as we arent afraid to get 30 cards whereas Joe Q Public usually gets 3 , not knowing its in their power to be able to get 30 lol

Re: Store cards- the argument for closing

tcbofade — Sun, 18 Oct 2020 13:30:04 GMT

...or 38

Our Home Depot card got CLD'd to a $500 credit limit.

I have a $36k NFCU Platinum credit limit.

...and 36 in between.