Tis the season to really get to know your credit card

Scott Robertson, Managing Editor

Scott Robertson, Managing Editor

By Scott Robertson

Congratulations, shoppers! You’ve made it through Black Friday (which, sadly, started Thursday), Cyber Monday and Giving Tuesday. So let’s take a quick look back at the week in retail, and ahead at how you’ll pay for it.

First, allow me to digress with a hearty thank you to those who eschewed online options in favor of shopping small. Locally-owned businesses generate tax dollars here so you don’t have to pay so many yourself. They also provide jobs and keep our money in our region. I wholeheartedly encourage you to shop local for the rest of your holiday needs.

I’ve gotten addicted to checking the studies at wallethub.com. and its sister site, cardhub.com. Both provide fascinating (well, at least to me) insight into the best ways to spend and save money. This year the sites have done research on which stores offered the best and worst Black Friday sales.

For those who shopped at the big box stores, congratulations are in order if you took advantage of the best sale prices out there. For instance, according to Wallethub.com’s data, Ace Hardware’s Perfect Shape 7.5-foot Grand Fir Lighted Christmas Tree was discounted from $371 to $199 for Black Friday, a hefty savings in terms of both percent off and actual dollars. For sheer size of discount, the site found nothing bigger than HH Gregg’s Samsung 60’’ 4K Ultra HD Smart TV at $898, down from $1,900. Sears had the biggest percentage discount for a big-ticket item, at least among those we found, with the Craftsman 11-Drawer Ball Bearing Tool Chest down to $199 from $899, a whopping 78 percent discount. Wal-Mart followed closely with its discount on the Little Tikes Dunk’n Toss Bouncer, which was marked down 71 percent, from $425 to $125.

Not all the Black Friday sales were all they were cracked up to be this year, though. For instance, if you saw the SALE sign on the Samsung 350W Sound Tower Speakers at BJ’s and paid the sale price of $249.81, you saved 18 whole cents off the $249.99 regular price. How can a discount of seven percent of one percent be a sale? I mean, most of us aren’t moved by a seven percent discount. This “discount” was literally a hundred times smaller than that. Coal in the stocking for BJ’s.

If you’re like me and still have a fair bit of shopping to do, there are credit card options out there that can actually be beneficial to you this season, though you shouldn’t use them as excuses to overspend.

The Citi Thank You Premier Card, for instance, offers 50,000 introductory points, which could translate into as much as $625 in buying power when used on airfare or $500 when converted to gift cards. The Citi Diamond Preferred Card offers zero percent interest for the first 21 months, so long as you make the minimum monthly payments on time.

Cardhub.com does warn about one kind of zero percent financing that is growing more common. Roughly 47 percent of large American retailers who offer credit are using it, and it can pack a really nasty “gotcha.” It’s called deferred interest. This so-called feature can be found in the fine print, where you learn that finance charges can be retroactively applied to your full purchase amount if you make a late payment or have even a one cent unpaid balance when the introductory deal ends.

So let’s say you buy a $1,000 television with six months interest free and you still have $50 left to pay at the end of those six months. With most bank-issued zero percent cards, you’d be responsible for the finance charges on that $50, plus of course, the $50 itself. But with these retailer-issued zero percent cards you need to look for the words “deferred interest,” because they mean you’ll be responsible for the finance charges on the full $1,000, plus the $50 you still owe. So be careful about whose “free money” you take.

With those caveats in mind, though, shopping for, and using, the right credit card can provide you with significant financial benefits down the road. After all, when you pay cash, no one will offer you up to $1,000 in refunds on items that can’t be returned. No one will offer you up to a year extension on the warranty, free of charge. No one will offer you up to $2,500 in price protection if you find the item cheaper after you’ve bought it. And certainly no one will offer you up to $50,000 in refunds, replacements or repair on items lost, stolen or accidentally damaged. The best credit cards will do all those things.

With a little forethought, you should be able to spend responsibly, save more than you expected, and hopefully, even have a chance to remember what we’re celebrating.



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