Dave Says: Is a Store Credit Card Worth the Discount?

Dear Dave,

My wife and I are building a home, and we found a great entertainment center we both love. It costs $6,000, and the dealer said he would give us 10 percent off if we take out a store credit card. We have the cash to buy the piece, but we were wondering if it would be a good idea to get the card and use it for the entertainment center and Christmas gifts, then pay it off immediately.

Tyler

Dear Tyler,

I hate to burst your bubble, but I’m pretty skeptical about this idea. I know it sounds good on the surface, but the problem is the vast majority of people don’t have the discipline to follow through on a plan like this. Another issue is a lot of places like this hit you with a fee when you pay off the card, the thing runs over, then you get another fee, and so on.

I’d just call the manager out of his office and let him know that unless he discounts the entertainment center $600 I’m going to his competitor. No, there’s no way I’d take out a stupid credit card at this place whether I had the cash on hand or not.

Tyler, you need to learn right now it’s a bad idea to play with snakes. Stop screwing around with debt products, okay? Everyone thinks they’re the exception to the rule or they’re somehow winning or getting rich by doing stuff like this, but it doesn’t work. They’re trying to hook you, man!

— Dave