Retail Store Credit Cards
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Retail store credit cards are a convenient way to get the items that a person wants or needs and most stores make them easy to obtain and use. Many people have several of these types of plastic cards and can take advantage of store offers that provide a discount for purchases when using their charge account. Making retail store credit cards work to a person's advantage can be difficult, especially when the balances are not paid every month. Credit can be likened to a loaded gun; it must be handled with extreme caution or else great destruction can happen. But if a person has a strong will to resist the many temptations that the privilege of borrowing money can bring, these small plastic rectangles most of us carry around with us truly are a modern convenience.
Large department stores had charge accounts in the years leading up to the initial issuance of the credit or borrowing card. The idea of allowing a person to have the privilege of not paying for items at the time of purchase grew out of an understanding that the customer would pay the account on payday or on a certain day of the month. There was not even the thought of the customer extending the account beyond the thirty day limit. Today, the modern plastic card in our wallets certainly allows Americans to live beyond their means and many borrowers have extended their debt to the maximum allowable amounts, sometimes on more than one of their retail store credit cards. The result is that the furniture we bought the clothes we buy, the auto repair we had completed or the groceries that we purchased on our various plastic charge accounts have slowly made many of us in America debtors to the large banks that back these accounts.
Like it or not, most Americans over eighteen have a borrowing history score called a FICO score. This acronym stands for the Fair Isaac Corporation which developed the method by which the scores are compiled. Today, three large firms, Equifax, Trans Union and Experian keep track of every purchase made with our plastic and then the history of our payments and the mounting debt will begin to factor in to provide a score that is used for everything else in life, from renting an apartment to buying a car to purchasing a house. Many of the households in America, in fact by many estimates seventy percent live pay check to pay check and the reason is the high charge account payments that families must provide each month. These payments include MasterCard, Visa, Discover, American Express plus the various retail store credit cards that Americans have.
Credit scores are then figured by four big factors and these scores truly do rule our financial lives until our family puts us in the ground. They can be changed but only slowly over time. The first factor is the payment history and late payments on any credit account, car, house and retail store credit cards will be counted as a black mark on our borrowing good name. The amount of the debt on each of the pieces of plastic that we own, including retail store credit cards also is factored into our FICO score, with greater negativity on the score the closer to the maximum borrowing amount we get. Being maxed out is not a good thing. The third factor in figuring our FICO score is how long we have had a borrowing history, which kind of hurts young people unless they have really handled their plastic responsibly. The final factor is how often a person seeks new lines of credit with frequency being a negative.
While most big credit card companies such as Visa and MasterCard offer enticing low interest offers to get started, retail store credit cards are usually not so accommodating. Right from the start, stores who extend easy borrowing privileges have high interest rates, usually hovering around eighteen to twenty percent. This means that making minimum payments can stretch out to thirty years in order to pay off retail stores well as those bank plastics we have in our wallet and purse. For many people, the clothes and shoes and groceries bought ten years ago and still being paid for now, and may continue to be for many years to come. The plastic card in our wallet truly is making many people economic slaves to banks. So many people are in bondage to credit and drugs and alcohol and other addictions but Jesus Christ lived, died and rose from the dead to break the chains people have. "The Spirit of the Lord is upon me, because he hath anointed me to preach the gospel to the poor, he hath sent me to heal the brokenhearted, to peach deliverance to the captives, and recovering of sight to the blind, to set at liberty them that are bruised." (Luke 4:18)
The retail store credit cards that you have in your possession can be a very convenient way to take advantage of super sales that all stores have from time to time. Whether it is clothes or furniture or some other needed item, if a person doesn't have the money at the moment but the sale is on, the plastic car in the wallet can be very helpful. But the only way a sale will work is if there is no interest paid on the account and that isn't possible with most retail store plastic cards. Unless a person is highly disciplined to pay off a balance very month, the best advice is to stay away from plastic charge cards altogether. Pay in cash and sleep well at night.
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