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Welcome to our Padlet wall, here we have taken time to research the topic of credit choices and whether certain types have more advantages than others.

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Have you ever walked into a checkout line and before they ask you about your payment options, they ask if you own the store credit card? The initial incentive is always redeemed towards your purchase to get you hooked and then you realize how high the interest rates are a unpaid balance. This website outlines the pros and cons of owning a credit card from your favorite retail stores.
I learned that although owning a credit card to my favorite store can have perks, the interest rates are very high.

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When it comes to credit cards, there is no shortage of choices for consumers. According to the Canadian Bankers Association, there are 76.3 million Visa and MasterCard cards currently in circulation in Canada. Credit cards come in all different shapes and sizes - there are standard credit cards, premium credit cards, and retail credit cards to name a few.

It should come as no surprise retailers are looking to cash-in on the lucrative credit card business. Retailers can conveniently flog their credit cards at booths when you're shopping in their stores. While retail credit cards offer a way to save money at your favorite store, those savings come at a cost.

Advantages of Retail Credit Cards

Sign-up Bonuses: Signing up for a retail credit card can be an excellent way to score a discount at your favourite store. Often you'll a discount on your very next purchase just for signing up. As long as you use your retail credit card responsibly and pay your balance in full by the end of the grace period, this can be a great way to save.

Discounts & Promos: It's common for retail cardholders to get additional discounts or special offers. For example, you may be able to take advantage of an "additional 5% off" when you use your retail card during a sale. Just remember to stay on budget and don't buy more than you can afford to pay back.

Interest-Free Periods: Retail credit cards sometimes come with an interest-free period. For example, you might not pay a cent of interest over the first six months for when carrying a balance. This can be an excellent way to manage your cash flow, as long as you pay off your balance in full before the interest-free period is over. If you don't pay it off beware; interest will be calculated from the date you made the purchase, which can cost you a pretty penny, especially with the higher interest rates retail credit cards often carry.

Disadvantages of Retail Credit Cards

Credit Limit: While standard credit cards often reward you by offering you a higher credit limit, retail credit cards usually start you on a lower credit limit. For example, if your credit limit is $500, and you carry a balance of $250, your credit utilization will be 50%, which could lead to a lower credit score. If your credit limit only $500, you may only be able to spend $150 a month (30% of your credit utilization) without putting your credit score at risk.

Interest Rates: Retail credit cards usually come with higher interest rates. While the interest rate is 19.99% on a typical credit card, retail credit card interest rates may be as high at 30% at your favourite store. If you don't pay off your balance in full before the end of your grace period, be prepared to pay through the nose.

If you carry a balance of $5,000 and only make the 3.0% minimum payments each month, it will take you over 18 years to pay off your existing balance at an interest rate of 19.99%, but if the interest rate increases to 30%, it will take you over double the length of time - to the tune of over 44 years.

Credit Score: Building a good credit history is important for your financial health, especially if you want to borrow money to purchase a house or car. If you're looking to build a positive credit history, there are better ways than a retail credit card. Retail credit cards typically have less of an impact on your credit score than standard credit cards. Although a positive payment history will improve your credit score, retail credit cards typically don't carry as much weight as a major credit card.

Limited Usage: Retail credit cards usually don't come with the same flexibility as standard credit cards. Those used to using their credit card at any retailer of their choosing could be in for a rude awakening. Retail credit cards can usually only be used at the store that issued the card. For example, if there's a sale on flat screen TVs at retailer A, but your credit card is for retailer B, you won't be able to take advantage of the sale.

Out of Sight, Out of Mind: With retail credit cards, the temptation to overspend is even greater than standard credit cards. You'll often receive rewards and discounts just for making purchases. If you don't carefully watch your spending you could end up with a balance you won't be able to pay in full at the end of your grace period and be forced to carry a balance. A good rule of thumb is to only purchase what you can afford to pay in full; you should also try to keep your balance to less than 30% of your available credit.

The Bottom Line

If used responsibly retail credit cards can be an excellent way to get a deal at your favourite retailer, but if you carry a balance, watch out - the interest rates can be as high as 30%! While retail credit cards can be beneficial if you like to shop at a certain store, they frequently have limited usage; often they can only be used at the store that issued the card. While retail credit cards are a good complement for standard credit cards, they're not typically suitable as a replacement.

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The Pros and Cons of Retail Credit Cards, CreditCardsCanada.ca

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When it comes to credit cards, there is no shortage of choices for consumers. According to the Canadian Bankers Association, there are 76.3 million Visa and MasterCard cards currently in circulation in Canada. Credit cards come in all different shapes and sizes - there are standard credit cards, premium credit cards, and retail credit cards to name a few.

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This website is issued by the government of Canada outlining different types of credit to choose from and applying the advantages and disadvantages to each. Most individuals can get caught up in the offers and benefits and rarely read the fine print.   The website offers tips on how to keep borrowing costs low and what to look for when you are signing any loan or borrowing agreement.
I learned a lot on this site. It made me a lot wiser about which credit options I have so I can make better and smarter borrowing decisions in my future.

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Explore the different types of credit available, the real costs of borrowing and making smart borrowing decisions.

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This website outlines the pros and cons of low interest credit cards. There are so many different types of credit cards available and some seem better than others. Low interest rate credit cards offer less stress when you are overcome with payments due to the low interest rates. They have drawbacks as with anything card such as no rewards. Sometimes depending on an individuals situation in their finances low interest credit cards can suffice for the time being.
I learned that this would be a wise decision for me if I was looking into a new credit card. Since I am a student, I barely use my reward card enough to even benefit from them.

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As the name suggests, low interest credit cards have low interest rates. Typically, rates on low interest cards range between 10% and 15%, which is significantly lower than a travel rewards credit card. These cards are ideal if you tend to carry a monthly balance. Here's a look at the pros and cons associated with low interest credit cards:
The pros 1. Save money on interest payments
Arguably the biggest advantage to low interest credit cards is that you'll save money on monthly interest payments. If you're someone who tends to carry a credit card balance month to month, you should definitely consider a low interest credit card. Many credit cards can have an interest rate as high as 30%. If you compare this to a low interest credit card with an interest rate of 15%, your monthly payments will be cut in half. This can lead to huge savings and is one of the biggest advantages of a low interest credit card.
2. Lower annual fees
Low interest credit cards tend to have lower annual fees. Depending on which card you choose, you can expect an annual fee of anywhere from $0 to $30. This is nothing compared to the $120 or $150 annual fee you might find on a rewards credit card.
3. Helps pay off current credit card debt
If you have a lot of credit card debt, we'd typically recommend using a balance transfer credit card. Balance transfer credit cards are hands down the best option for paying off accumulated credit card debt. They offer a low interest rate (or 0% interest rate) on all balance transfers for an introductory period. If you can use your balance transfer credit card responsibly and pay down your debt within the promotional period, this is the best option for you.

The one problem with balance transfer credit cards is that they're a temporary fix. They provide a low interest rate on all balance transfers for the first few months you have on the account. Often the interest rate will then increase to a typical interest rate of around 20%. If you can't pay off your accumulated debt within the given time period, you may want to consider something more long term.

Low interest credit cards offer an alternative. The interest rates on these cards don't have a restricted time period. Therefore, you can transfer your credit card debt to a low interest card and you'll save on high interest payments. Some cards even offer an introductory balance transfer option followed by a low interest rate. This is the perfect opportunity to begin paying off your current credit card debt and avoid accumulating more debt from high interest payments.
The cons 1. No rewards
The big disadvantage of a low interest credit card is it won't provide the extensive benefits and rewards you'd get with a rewards card. Typically, there's no way to earn rewards on your spending. And your benefits (such as travel and purchase insurance) are highly limited.
2. The low interest trap
If you're going to carry a low interest credit card, don't get too comfortable. Sometimes you can fall into the trap where because you have a low interest rate, you don't feel the pressure to pay down your credit card debt. Just because you have a low interest rate doesn't mean that you can't rack up debt by not paying your monthly balance. You should always make an effort to pay as much as you can. You should view a low interest credit card as an opportunity to pay off your current credit card debt and not a time to accumulate debt.
3. Balance transfers often come with a fee
Low interest credit cards are a great way to begin paying off your current debt. Therefore, it makes sense that you'd want to complete a balance transfer (transfer other credit card debt to your low interest card). Just be aware that most low interest credit cards will charge you a fee on all balance transfers.
4. Say no to cash advances
Most low interest credit cards have high interest rates for cash advances. We wouldn't recommend making cash advances with your low interest credit card. However, there are a few low interest cards that don't have this problem. Just make sure to shop around and find the card that's right for you if the cash advance feature is important to you.

Here's a look at our top four low-interest credit cards:
BMO Preferred Rate MasterCard
Choose the BMO Preferred Rate MasterCard if you don't mind a small annual fee and you're looking for a low interest rate for purchases, balance transfers, and cash advances.
MBNA TrueLine MasterCard

Consider the MBNA TrueLine MasterCard if you're looking for a no annual fee card and a few extra insurance benefits. The interest rate for this card is unique as it's based on your credit rating. If you have excellent credit, you'll likely be approved for the 5.99% interest rate. This rate is incredibly low for a no-fee credit card. If you happen to have poorer credit, you'll likely have a higher interest rate (up to 14.99%), which is still considerably low for a no interest credit card. Note that you shouldn't use this card for cash advances as the interest rate is 24.99%.
Scotiabank Value Visa

11.99% interest rate

0.99% interest rate on cash advances and balance transfers for the first six months (offer valid until Oct. 31, 2016)

$29 annual fee

If you have existing credit card debt you're looking to pay off and you don't mind an annual fee, choose the Scotiabank Value Visa. This card has a balance transfer offer for the first six months but your interest rate will remain low after the first six months and on any purchases you make with the card. Note that this card has a 1% fee on all balance transfers.
MBNA Platinum Plus MasterCard
Consider the MBNA Platinum Plus card if balance transfers are most important to you. This is an excellent choice for a balance transfer credit card as there are no interest charges on balance transfers for 12 months. However, this isn't a low interest credit card. After the introductory period ends, the interest rate goes up to 19.99%. Also, there's a 1% fee on all balance transfers.
Also read:
Flickr: Perspecsys Photos

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The Pros and Cons of Low Interest Credit Cards - RateHub Blog

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As the name suggests, low interest credit cards have low interest rates. Typically, rates on low interest cards range between 10% and 15%, which is significantly lower than a travel rewards credit card. These cards are ideal if you tend to carry a monthly balance.

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This video is a helpful for students in particular. Many students suffer from debt from all different type of credit choices, credit cards and OSAP are the common types. What students would benefit from is taking the time to consolidate all their debt into one. By taking out a student line of credit they can lower their interest rates and compress all owing debt into one place.
I learned from this video that once it is important that I visit a financial adviser and consider my options of consolidating debt.

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Should I use a Line of Credit to pay off Credit Card Debt?

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This video outlines the risks of falling into the habit of using payday loans. This is a spiraling phenomena that Canadians get caught in, where asking for cash is easy and seemingly without ties, and works well for that desperate moment; thereafter, they begin to scramble for money to pay the loan back. The interest rates are outrageous and individuals end up worse than they began.
What I learned from this video, is that even if it is a last resort, the amount of further damage it can cause is still outweighing.

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Consolidated Credit Counseling Services of Canada

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The Trouble with Payday Loans | Consolidated Credit Canada

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Buying a house is a large commitment and an incredible investment but at what cost? A mortgage can have you paying monthly payments on your house for decades. This video is about a man who purchased a home in Toronto and was able to pay off his mortgage in 3 years by working hard, renting out his upstairs and taking out a 5 year fixed rate loan from a secondary lender.
I've learned that credit is something that is used to help individuals reach goals quickly but the longer it takes for that individual to pay it back the more money they have to spend. This video is an interesting take on the advantages of using credit to help you toward a goal, instead of relying on it completely.

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How to pay off a $255,000 mortgage in 3 years - The Exchange

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Credit choices are endless, there are many ways to obtain credit, whether it is good or bad, credit can give you the freedom to own items and experience things quickly. This is not usually with out some sort of consequence. It is important to research credit options and read the fine print. Obtaining fast money can be easy, but it is not as glamorous as it seems. Protect yourself and choose wisely.

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We have all heard a multitude of credit card offers, each one with their advantages and disadvantages. It is important to do the research and find what card works for you and your current situation.

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Store credit cards are often offered to us towards the end of store purchases. They are trailed with incentives to earn cash back or discount on purchases, but most often than not, consumers are left with unpaid balances with high interest payments.