Comparing Popular Store Credit Cards (Best Buy, Home Depot, Kohls, Lowes)
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Every day, millions of Americans utilize store credit cards for their everyday shopping, often reaping rewards and enjoying exclusive benefits. However, with so many options available, it can be challenging to determine which card offers the best value for your personal shopping habits and financial situation. Today, we will be comparing four popular store credit cards - Best Buy, Home Depot, Kohl's, and Lowe's - to help you make the most informed choice.
Yet, before we delve into the details, it's worth considering if store credit cards are the right option for you at all. Despite the attractive perks and convenience they offer, store credit cards may not always be the best idea. Why? The reasons are layered and significant. From high-interest rates to potential credit score impacts, store credit cards carry hidden costs that might surprise you. For a comprehensive understanding of why you might want to think twice before opting for a store credit card, consider reading our in-depth article, Think Twice: The True Cost of Store Credit Cards.
Best Buy Credit Card
Earnings: Cardholders get flexible financing options, and Elite Plus members receive a generous 6% back in rewards.
Standard APR: The card carries a high standard APR, which varies based on market prime rate and creditworthiness. As of my knowledge cutoff in September 2021, the APR was above 25%.
Downsides: The high APR can lead to significant interest charges for those who carry a balance from month to month. Additionally, the rewards and financing are strictly tied to Best Buy, limiting the card's usefulness for broader spending.
Home Depot Consumer Credit Card
Earnings: This card doesn't offer a typical rewards program but does provide deferred interest financing on purchases of $299 or more and an extended return window.
Standard APR: The standard APR is quite high, typically over 20%, but can vary based on market conditions and the cardholder's creditworthiness.
Downsides: The lack of a rewards program is a considerable downside, making the card less appealing for those not planning large purchases. The high APR can also lead to substantial interest costs for those who do not pay their balance in full each month.
Kohl's Credit Card
Earnings: Cardholders receive an extra 35% off their first purchase after approval and enjoy numerous exclusive savings events throughout the year. They also have access to the Kohl's Cash rewards program.
Standard APR: Like the others, the Kohl's credit card has a high standard APR, typically over 20%, and varies based on the prime rate and individual creditworthiness.
Downsides: The high APR is a major drawback, and the card's benefits are strictly tied to Kohl's. If you don't frequently shop at Kohl's, the card may offer limited value.
Lowe's Advantage Card
Earnings: This card offers a flat 5% discount on eligible purchases or special financing on purchases of $299 or more.
Standard APR: The standard APR for the Lowe's Advantage Card is also quite high, generally above 20%, and varies based on market prime rate and creditworthiness.
Downsides: The high APR is a notable downside, and like the others, the card's benefits are specifically tied to Lowe's. If you're not a regular Lowe's shopper, this card may not offer significant value.
Remember that all credit cards should be used responsibly. Always read the terms and conditions thoroughly and understand the potential costs associated with these cards before applying. Also, APRs and terms can change, so it's essential to check the most current details before applying.
Four Better Options to Maximize Retail Cash Back
If you were considering a store credit card, chances are you're planning on making substantial purchases at your favorite retailer. While it might seem like a logical choice to opt for the store's card, it's important to understand that there are numerous other credit cards out there with far superior value and return structures. Here are four credit cards that are particularly well-suited to yielding maximum cash back, particularly if you're an avid shopper in various retail sectors.
1. Chase Freedom Unlimited®: "Earn Bonus Point" Program
Earn Rate
Earn 5% cash back on travel booked through the Chase Ultimate Rewards portal.
Receive 3% cash back on dining at restaurants, including takeout and eligible delivery services.
Get 3% cash back on purchases from drugstores.
Benefit from a steady 1.5% cash back on all other purchases.
Earn Bonus Points Through the Chase Ultimate Rewards Platform
When you use the Chase Freedom Unlimited® card, one of the key advantages is the ability to earn bonus points through the Chase Ultimate Rewards platform. This platform not only allows you to get a significant 5% cash back on travel purchases, but it also often features various shopping deals and offers. These allow you to earn extra bonus points or get increased cash back rates at specific retailers, further enhancing your potential rewards.
How to Redeem
Redeeming your cash back with Chase Freedom Unlimited® is user-friendly and flexible. You can redeem any amount at any time, and your cash back rewards never expire as long as your account is active. You can choose to use your rewards for statement credits, direct deposits into most U.S. checking and savings accounts, gift cards, travel through the Chase portal, or even shopping with points at Amazon. The wide array of redemption options adds to the versatility and attractiveness of this card.
Learn more about the Chase Freedom Unlimited® here
2. Citi® Double Cash Card: Always Earn 2x On Any Purchase
Earn Rate
Benefit from a flat 2% cash back on all purchases—1% upon purchase and an extra 1% as you pay off those purchases.
This simple, high-yield approach applies to all categories of spending, including electronics, providing immense flexibility and earning potential.
Citi's Unique Approach: The ThankYou Points System
An important feature to note about Citi Double Cash Card is its unique approach to rewards - the ThankYou Points system. The cash back you earn can be converted into Citi ThankYou points, where every dollar of cash back equates to 100 ThankYou points. These points can provide additional value if you transfer them to Citi’s airline partners or use them towards travel through the Citi Travel Center.
How to Redeem
Redeeming cash back with the Citi® Double Cash Card is simple and straightforward. Once you've accumulated at least $25 in cash back rewards, you can choose to redeem them for a check, a statement credit, or a gift card. The rewards never expire, which means you have the freedom to redeem them at your convenience. Moreover, if you choose to convert your cash back into ThankYou points, there is a multitude of redemption options including travel, gift cards, and online shopping.
Learn more about the Citi® Double Cash Card here
3. The Bilt Mastercard®: 2x On Rent Day + Use for Free Travel
Earn Rate (See Wells Fargo terms here)
2x points on travel
3x points on dining
4x points on travel and 6x points on dining on rent day purchases 1x points on everything else
Unleashing Potential with Bilt's Travel Partners
One of the most potent features of The Bilt Mastercard® is its array of prestigious travel partners. The points you earn on rent and other purchases can be transferred to a variety of Bilt's travel partners. These partners include some of the biggest names in the travel industry, such as American Airlines, Delta Airlines, and Hyatt Hotels, among others. This feature dramatically broadens the scope of your rewards redemption, offering you a chance to turn your everyday spending into exotic vacations or valuable airline miles.
How to Redeem
When it comes to rewards redemption, The Bilt Mastercard® offers an appealing level of flexibility. You can use your points for free travel, or transfer them to one of Bilt's many travel loyalty program partners. This broad range of options means you're not just confined to cash back redemption; instead, you can leverage your points for high-value travel experiences, truly unlocking the potential of your everyday spending.
Learn more about The Bilt Mastercard® here
4. Blue Cash Everyday® Card from American Express: 3% Cash back on U.S. Online Retail Purchases on up to $6,000 per year
Earn Rate
3% Cash back at U.S. supermarkets, on up to $6,000 per year, then 1% after that.
3% Cash back on U.S. Online Retail Purchases on up to $6,000 per year, then 1% after that.
3% Cash back at U.S. gas stations on up to $6,000 per year, then 1% after that.
1% Cash back on other purchases.
How to Redeem
The Blue Cash Everyday Card operates as a cash-back credit card, simplifying the reward redemption process. It lets you accumulate rewards as Blue Cash reward dollars, which can be directly redeemed as statement credits without any minimum requirement. American Express might occasionally provide alternative redemption methods, like gift cards or merchandise. However, when exploring these options, make sure the redemption rate is either equal to or exceeds the rate for statement credits. The value of your rewards in the form of statement credits stands at 1 cent per reward dollar.
Learn more about the Blue Cash Everyday® Card from American Express here