How to Use Store Credit Cards for Holiday Shopping

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Whether you shop online or in-person this holiday season, you'll likely get asked at some point if you want to apply for a store credit card. If you get approved and use the card wisely, you can potentially save on gifts, decorations, food and other important items on your shopping list. Even better, you can often reap benefits long past the holiday season. To best utilize these cards for holiday shopping, use these tips and tricks so you choose the right cards, shop wisely, take advantage of perks and minimize the potential financial downside.


1. Research Store Credit Card Options

If you already have store credit cards, read up on the card terms ahead of the holiday shopping season so you can prepare your spending strategy. You'll want to learn about perks you might have such as points for purchases, bonus offers, financing deals or discount programs. Also, pay attention to terms such as the interest rate, credit limit and fees.


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If you're interested in applying for new cards, start reviewing the card section on your favorite store's website to learn about the benefits and downsides. For example, if you shop at Kohl's a lot, you'll find their store credit card gives you a first-purchase discount and year-round offers, but the card doesn't work anywhere else. In contrast, an Amazon store card is a flexible Visa card with a welcome bonus for plus cash-back rewards anywhere you shop.


Consider also​: Do You Know Store Credit Card Basics?

2. Apply for Store Cards Wisely

While you might find getting several store cards appealing when they can give you first-purchase discounts for your holiday shopping, avoid applying for too many. Otherwise, it can damage your credit score since the new inquiry causes you to lose points, and there's also the risk of going into debt with too many card accounts to manage. Instead, only apply where you plan to shop most – not only during the holiday season but around the year.


While spending for the holidays, keep in mind that a higher interest rate is a common downside with store credit cards.

3. Plan Your Holiday Purchases Carefully

Since store credit cards tend to offer an attractive first-purchase discount, you'll want to plan your purchases to take advantage. Get out your holiday shopping list and check which stores have most of what you need. Along with relying on your first-purchase discount, also look into whether you can combine that offer with regular store discounts. While you're doing this, keep your holiday budget in mind and avoid the temptation to go over it just to get the most out of store credit card perks.


Consider also​: How Do You Set a Holiday Budget?

4. Save Through Perks and Specials

As you do your holiday shopping, watch out for any seasonal specials for cardholders or public sales events. You'll want to especially look for Black Friday and Cyber Monday sales. An additional upside is you can often use your coupons and card benefits and maximize your savings during these sales events. But at the same time, still shop around for good prices and don't feel you have to spend at a certain place just because you have a card there.


Keep in mind that your store credit card might help you save on purchases elsewhere, especially if it's a Visa or Mastercard. For example, you might get some cashback on gas, bills and meals, or you could receive points you can redeem toward holiday flights and accommodations. Such cards often help you continue to save around the year.


Consider also​: Using Points for Holiday Travel

5. Use a Smart Payoff Strategy

While spending for the holidays, keep in mind that a higher interest rate is a common downside with store credit cards. Unless you can get a zero-percent financing offer and pay everything off before expiration, it's good to plan to pay your full balance when you get your card statement. But if you need to make monthly payments, pay off as much as you can rather than just the minimum each time. This all emphasizes the importance of monitoring your holiday spending and not just buying extra things to reap your store card's benefits.

Consider also​: Getting the Most from Store Credit Cards