How many times have you been asked to sign up for store credit cards? And, how many times have you followed through?

For some, shopping comes as second nature. The excitement of buying new items creates fulfillment and happiness. However, having multiple retail store credit cards can actually make you lose money. We’re here to discuss the 7 sneaky ways store credit cards can negatively impact your finances.

1. They have mountainous interest

Interest is a huge obstacle when it comes to finances. The average store-brand card has an APR of 26.38 percent. That is very high in regards to paying back debt. Imagine never getting over the hurdle of paying off a credit card balance because the majority of each payment goes towards interest. It’s a very fast and painful way to drain your bank account.

2. Mess with your credit score

Every time you sign up for a store credit card, it affects your FICO score. Additionally, not monitoring your usage will hurt your finances, too.

Each purchase using a credit card draws the debt to credit ratio a little closer to being maxed out. Furthermore, as the balances rack up, your credit score changes. Consider this across multiple stores and your finances have the potential to be all over the place. Not the piece of mind or luxury most were hoping for.

3. Easy to miss a payment

Juggling all of the terms of various cards is the reason many choose to consolidate. Imagine tracking 7 different payments to 7 different companies. Essentially, that’s what having multiple store cards is like. With so much accounting, it’s easy to miss a payment.

4. You can only use them in one place

A real disadvantage to dedicated store cards is that you can only use them in one place. In many instances, customers with store credit cards shy away from going to other places because they want to use their cards. So, instead of shopping around for the best deal in town, they lose money for the sake of using credit.

5. No guarantee on unauthorized charges

The consumer fraud alert is at an all-time high. Additionally, not all in-store cards guarantee financial reimbursement in the instance of unauthorized charges. This can be devastating to a victim of identity theft. Be careful when signing up for store credit cards that lack this safeguard.

6. No extended warranties

Unlike regular credit cards, most store credit cards do not offer extended warranties on purchases. That means, if you want protection after the manufacturer’s warranty has ended, you may not be able to get it through your store card.

7. They create a snowball effect

Bad habits only lead to more bad habits. The malls are full of multiple department stores, each boasting their own cards. In a single afternoon, there is no telling how many a person can sign up for. Hence the reason that in-store credit cards create a snowball effect that’s hard to control.

Using store credit cards

While there are some benefits to store credit cards, there are also some sneaky side effects. Before signing up for any line of credit, make sure you fully understand the conditions. Also, consider how the debt will be paid back.

In conclusion, everyone will most likely use credit at some point in their life. Just make sure that it’s within your means and on GOOD terms.