The Truth About Your Sears Credit Card

The Truth About Your Sears Credit Card :So you signed up for that Sears credit card to save a few bucks on your recent appliance purchase. You thought it was a good deal at the time – 20 percent off for opening the card, right? But now that bill has arrived and you’re wondering what you really got yourself into. Before you make another charge on that card, there are a few truths about your Sears credit card you need to know.

The interest charges are no joke. If you don’t pay the full balance each month, the APR is going to hurt. And those special promotions you signed up under? They only last a few months. If you thought you’d always pay 0 percent interest on your Sears card, think again.

There are ways to make the most of your Sears card without drowning in debt. But you need to go in with your eyes open to the fees and rates so you can use the card to your advantage rather than end up paying for years to come on that single appliance purchase. The truth is, your Sears credit card can work for you, but only if you know how to work it.

The History of the Sears Credit Card

The Sears credit card has been around since the early 1900s, first as a way for customers to finance purchases and then evolving into a full-fledged credit card. ###

In the beginning, Sears started offering installment credit plans where customers could pay for items over time with a small down payment. This made Sears’ products more accessible and affordable to average families. By the 1950s, Sears introduced their first official credit card, the Sears Revolving Charge Account, allowing customers to make smaller payments over time with interest charges.

In the 1980s, Sears partnered with Discover Card to launch the Sears Premier Card, their first card that could be used anywhere Discover was accepted. This introduced Sears credit cards to a wider range of benefits like purchase protection, extended warranties, and rewards. Sears has continued to enhance cardholder benefits and options over time.

Today, Sears offers several credit cards including the Shop Your Way Mastercard, Kenmore Elite card, and Lands’ End card. While Sears has faced financial difficulties in recent years, their credit cards remain popular due to their generous rewards rates of 5-6% at Sears and partner stores like Kmart, discounts, and special financing offers.

The Sears credit card has endured for over a century by adapting to changes in technology, consumer needs, and the retail industry. For many families, it remains an important part of their financial lives and a way to save on essentials and discretionary purchases. While the future of Sears may be uncertain, their credit cards will likely continue serving customers well into the future.

Benefits of the Sears Credit Card

A Sears credit card comes with some nice perks that make the fees worthwhile.

Earn Rewards Points

For every $1 you spend at Sears and Kmart, you earn 2 points that can be redeemed for gifts, travel, and more. Rack up points on things you buy anyway and get rewarded!

Special Financing Offers

Sears frequently runs promotions offering 0% APR for 6-24 months on large purchases like appliances, tools, and fitness equipment. Take your time paying with no interest charges as long as you pay the minimum due each month.

Exclusive Coupons and Sales

Cardholders get access to extra discounts and coupons for Sears and Kmart in the mail and online. You can save 10-20% or more on sale items. They also send surprise “private offers” with huge savings on select brands.

Flexible Payment Options

You have options for how much you pay each month, from the minimum to the full balance. Pay just the minimum and you’ll incur interest charges, of course, but you have flexibility in a pinch. You can also set up automatic payments for the amount that works for your budget.

While the APRs and fees on a Sears card aren’t the lowest, the benefits are valuable if you shop there frequently. Responsibly used, a Sears credit card can save you hundreds per year and make life a little more rewarding. Give it a shot—you’ve got nothing to lose but higher prices!

Drawbacks of the Sears Credit Card

The Sears credit card may seem appealing with its discounts and rewards, but there are some significant drawbacks to consider before applying.

High Interest Rates

Sears credit cards are notorious for high APRs, often over 25% for those with average credit. If you carry a balance from month to month, the interest charges can quickly outweigh any rewards or savings. Pay the balance in full each billing cycle to avoid costly finance charges.

Limited Use

The Sears card can only be used at Sears, Kmart, and a few partner stores. If Sears isn’t where you frequently shop, the rewards and perks of the card won’t benefit you much.

Better Options Exist

There are general rewards credit cards with more flexibility and lower interest rates. A card like the Citi Double Cash, Chase Freedom Unlimited or Wells Fargo Propel American Express® card offers 2% back or more on all purchases, not just at select stores. If you have good credit, you’ll likely qualify for a lower APR as well.

Before you apply for the Sears credit card, make sure it suits your needs and spending habits. If high interest charges concern you or you prefer more flexible rewards, you may want to consider other options. But for loyal Sears and Kmart customers looking to save on purchases, the Sears card could still be worthwhile if used responsibly.

Alternatives to the Sears Credit Card

The Sears credit card may seem convenient, but there are better alternatives out there for you. Here are some options to consider:

Store Card from Another Retailer

Many major stores offer their own credit cards, like Target, Kohl’s or JCPenney. Their cards often provide extra perks like discounts, rewards and special financing offers that can save you money. Compare the benefits and interest rates to find a store card that suits your needs.

Cash Back Credit Card

A cash back credit card gives you a percentage of your spending back in the form of cash rebates or statement credits. Many offer 1-5% cash back on all purchases. Cash back cards from Citi, Chase and American Express are popular, with no annual fee. The cash back you earn can really add up over time.

Travel Rewards Credit Card

If you frequently travel, a travel rewards credit card lets you earn points or miles on your spending that can be redeemed for free flights, hotels, and more. Cards like the Capital One Venture or Wells Fargo Propel offer generous sign-up bonuses worth hundreds of dollars in travel. Compare the rewards rates for the types of travel expenses that matter most to you.

Low-Interest Credit Card

If you carry balances from month to month, a low-interest credit card can save you money on interest charges. Look for cards with APRs under 15% and no annual fees. Local credit unions often offer the lowest rates. A lower-interest card means more of your payment goes toward paying down your principal balance.

In summary, you have solid options beyond the Sears credit card that may better match your spending habits and needs. Review various offers to find one with benefits that outweigh any annual fees. Your wallet and credit score will thank you.

Is the Sears Credit Card Right for You?

So, you’re thinking about applying for the Sears credit card. Before you do, it’s worth considering if it’s the right card for your needs. Here are some things to keep in mind:

Rewards and benefits

The Sears card offers decent rewards on purchases at Sears and Kmart, giving you 5% back in points on all qualifying buys. You can then redeem those points for more merchandise, gift cards or cash back. However, the rewards rate drops to just 1% for purchases anywhere else. If you do a lot of shopping at Sears, the rewards can add up quickly. But if not, you may find better reward rates with another card.

Interest rate

The APR on the Sears card is quite high, currently around 27%. So if you think you’ll carry a balance from month to month, the interest charges could outweigh any rewards. It may be better to find a card with a lower rate. However, if you pay the balance in full each month, the APR won’t matter.

Credit limit

Sears is usually pretty generous with credit limits for those with good credit. So if you want a higher limit, the Sears card may appeal to you. They frequently start new cardholders out with a minimum of $5,000. For those rebuilding credit, you may be able to qualify for a secured card to establish a good payment history before graduating to an unsecured card.

Additional perks

The Sears card also provides some useful benefits like free shipping on sears.com orders over $49, exclusive coupons and sales, and extended return policies. For frequent Sears shoppers, these types of perks could make the card worthwhile.

In the end, you need to weigh the pros and cons based on your spending and needs. If you want simple rewards and perks for shopping primarily at Sears, the Sears credit card could be a great choice. But for broader rewards and lower APRs, you may want to consider other options. The decision is yours!

Conclusion

So there you have it. The truth about your Sears credit card may not be as straightforward as you once thought. While the rewards and discounts can add up over time, the interest charges will too if you’re not diligent.

Pay attention to the details in your statements and agreements and don’t get lured in by the shiny rewards and financing offers alone. Your Sears card can be useful if used responsibly, but it’s not the best card for everyone.

Only you can decide if the good outweighs the bad based on your own spending and payment habits. The choice is yours – will you use your Sears card wisely or fall into the trap of revolving high-interest debt? Think it over and make the best choice for your own financial wellbeing. Your future self will thank you.