I’m not picking on certain stores even though I’m going to “name names.”  These are just my personal examples.  I want to explain why I think they are so horrible because I discovered that even my husband, who absolutely hates the use of credit cards, was confused about my refusal to take advantage of a discount I could have gotten if I would have been willing to put my purchase on a store issued credit card instead of paying cash when I went shopping last weekend.

I was at JC Penney and was purchasing a shirt for myself (I’ve been losing weight and all my spring/summer clothes are too big – yippee! – but that’s a story for a different blog).  The store had scratch off cards with a discount of 15%, 20% or 30% but the catch was the purchase had to be put on their store-issued credit card in order to be able to get that extra discount.

The cashier was doing her job (I know they are trained to ask people if they want to use their store credit card because that’s an important source of revenue for many stores) and asked me if I wanted to put my $17.99 purchase on my JC Penney card.  I politely said “no.”

She then asked if I had a JC Penney card.

I said “yes” because I technically do since I’ve never received a notice saying my account had been closed, but I did physically cut my card into several pieces a couple of years ago.  She then pointed out (nicely) how I could get 15%, 20% or 30% off my purchase if I used my store credit card.

I then said I didn’t have my card with me which was the wrong answer because she then very helpfully offered to look my credit card number up for me (yet another example of how my mother was right when she said “it doesn’t pay to lie” which was not the thought I wanted running through my head at that particular moment).  That’s when I had to come clean and say I don’t use my credit cards anymore and that I had cut mine up.  I thought that would shut her up.

It didn’t.

Then she told me how I could put the purchase on my store credit card and then immediately use the cash in my hand to pay it off.  I declined one more time and she finally let it go (probably because there were now several people in line behind me and this small transaction was starting to take up a lot of time); although I saw the look of “I can’t believe you are refusing to save money” look on her face.  I managed to not slink out of the store with my head down to avoid the looks of disbelief on the faces of the other shoppers.

I then went to Kohls where I found a really cute pair of workout pants on sale (I gotta say that I’ve been really motivated to lose weight because I know that growing out of my clothes in a “they’re way too big” way is the only way I can justify buying new ones right now).  I went through practically the same identical conversation with the sales clerk there because, surprise, they were having the same identical promotion with the scratch off cards that revealed a 15%, 20% or 30% discount (and not that you probably care but I’m pretty sure Kohls came up with that idea first since I’ve taken advantage of it many more times than I want to admit).

When I got home I was proud of myself for sticking to our cash only plan and resisting the temptation of the discount I could have gotten by using store credit cards.  I completely expected my husband to feel the same way when I proudly told my story; but instead I nearly fell over in shock when he said, “Why didn’t you use the store credit cards and then pay it off right away? You could have saved at least $7.”

After I recovered from the shock and after asking him if that’s really what he said (at that point I was sure I had been hallucinating), I realized that he might not be the only one that doesn’t understand why giving into that temptation is bad.

There’s 2 reasons:

1) Sometimes those transactions aren’t instantly posted on to your account (computers get tired and slow too).  There may be a 10, 20, or 30 minute (or more) delay, meaning you either have to hang around the store and wait to pay it off; come back another day (a waste of time and gasoline); or wait for the bill to come in the mail which means you then have purchased something on credit which is not a good thing if you’ve banned the use of plastic from your life.

2) A person’s mindset changes – at least mine does.  Let’s say I was lucky and got a 30% scratch off discount card when I was at Kohls.  In my case it would have meant an additional savings of $9.12.  My mind would have instantly gone into the “now I can spend more because I just saved $9? mode of thinking.  Chances are very high that I would have decided to wait to check out and went and spent that $9 savings on socks or underwear or a cute candle (who knows what I would have locked my eyes on to).

I wouldn’t have purchased anything else I needed (that I could afford) because I was already buying what I needed (and could afford).  Plus I probably would have bought more stuff because I had a 30% off coupon and that was a discount in addition to any discounts I would have already gotten due to sale or clearance prices!  (writing that practically made me hyperventilate because who doesn’t love a great deal and I missed out on it! – see how bad I am?)

I can’t trust myself with credit cards and if you’re like me ( I know there are others out there who are – you may or may not have admitted it yet), the savings is not worth the risk of buying way too much stuff all in the name of that “great deal.”

I first gave my husband the “there is sometimes a delay in the posting to your account” scenario about why I declined the discount which he seemed to understand, but then he then said, “Oh, then it was a matter of deciding if waiting around is worth your time and you decided it wasn’t.”

No! No! No!  Well, yes, but that’s not the only reason and not the most important one.

That’s when I had to explain the mindset change and the “temptation” factor which I know he doesn’t truly understand since he’s never ever had that problem, but he was smart enough to know that I was telling the truth because he’s witnessed my overspending for no apparent reason many times and has innocently asked why I bought something I didn’t need when I came home and showed off all the great deals I got.  He probably can’t remember how many times I said in a “Duh” way, “I bought it because it was really cute and really cheap!”

That’s why I think store issued credit cards with their great deals are evil and should be avoided.  Stores do it for one reason and one reason only and that’s because it MAKES THEM MONEY!  A lot of people don’t pay their purchases off before interest charges accumulate which is a win-win situation for the store.  They got you to buy their products and now they get to charge you interest for the privilege of buying from them.

With economic times being hard for retail stores, the revenue they earn from interest on their credit cards is more important than ever to them.  That’s why stores push the use of their credit cards and why cashiers often get bonuses or rewards for every person they sign up for a store issued credit card.

I’m not trying to single out JC Penney and Kohls.  There are plenty of other retail stores that offer deals to get people to use their credit cards.  Kohls and JC Penney are 2 of my favorite stores and I’ll continue to shop at them; but I’ll be the one paying cash when almost everyone else is handing over their credit card during one of those great “use your store credit card and get an extra discount promotions.”