Target shoppers should enter into this credit card agreement very carefully. Experts suggest you use only 20% to 30% of your available credit, which means you should only charge $200 a month with a $1,000 credit limit. That means cardholders will have to be circumspect when they head out for back-to-school shopping, since a large portion of your credit score is tied to your credit utilization rate - how much you owe on the card compared to its limit. You'll also likely have a relatively low credit limit. The REDCard is not the card to carry debt on.Ģ.

The Money Best Credit Card for carrying large balances, Citi Simplicity, never charges a late payment fee. REDCard late payers must fork over a $37 fee, $11 more than the Barclaycard Ring. By comparison, the Barclaycard Ring comes with an 8.25% variable APR. Those who carry a revolving balance will confront a 23.15% annual percentage rate, or about seven percentage points higher than the national average. Note that REDcard's remaining negatives are endemic of most retail brand credit cards.ġ. You won't receive 5% back on prescriptions, clinical services, or eye exams, nor will you receive a discount on a gift card - a favorite ploy of credit card reward maximizers. The card comes with other disadvantages, too. Of course, you can use your Citi Double Cash anywhere that accepts MasterCard, while your REDcard is only valid at the bulls-eye (that is, a Target store). So-called chip and PIN is considered more secure than most cards, known as chip and signature, which only includes a chip. Plus, the card comes with a computer chip and a corresponding PIN, similar to a debit card, to limit in-store fraud.

Calculator: How long will it take to pay off my credit card(s)?Ĭardholders don't have to pay an annual fee, and they'll also have an additional month for returns.

To put the REDcard's reward structure in perspective, the best flat-rate cash back cards earn you 2% cash back, like the Money Best Credit Card for cash back rewards, Citi Double Cash. Keep in mind that 5% rate of return on normal spending is more than three times greater than the yield on a 10-year U.S. So a $100 purchase made with the REDcard is immediately cut to $95, and that includes anything on sale or bought with a coupon. The benefits of the REDcard are easy to understand: You receive a 5% discount on pretty much everything in the store, from clothes to cookies to camping gear. You should strongly consider the REDcard if you a) shop at Target, and b) are a responsible credit card user. Should you sign up? Here’s what you need to know. Reasonable people may be concerned that the Target card might not be safe. Of course, any mention of credit cards and Target in the same sentence might elicit acid flashbacks to perhaps the worst hack of a retail store in U.S.

At the same time, many come with enticing cash back bonus programs.

Store-brand credit cards are inherently tricky pieces of plastic to use correctly, and can cost you real money if you make a few innocent mistakes. Chances are you probably bought something at Target (it had almost $74 billion in sales last year), saw advertisements for the card, and wondered if it was right for you. If you've ever bought a new shirt or toy car from Target, whether online or in person, chances are you've been asked to apply for a Target REDcard credit card.

Target red card