Target Credit Card – A Review

Store credit cards are not always the best choices for people looking to build credit because they offer limited benefits. However, some cards, like the Target credit card, could be perfect for the avid and loyal Target shopper.

The Target REDcard provides a 5% discount on many store purchases, and it also provides consumers with an annual 10% off coupon. To know if this card is right for you, dig a little deeper into the perks and pitfalls.

What Are the Benefits?

Beyond earning 5% off every eligible purchase at the store and website, the card provides several other benefits. For example, users get early access to promotions and products, free two-day shipping, and Starbucks discounts at in-store locations, plus you are enrolled in Cartwheel, a promotional program offering 5% to 50% discounts on hundreds of items.

However, while the perks are excellent for the routine Target shopper, the APR is high considering the limited usage of the card. The card offers a 22.9% variable regular APR, which is relatively high for a card requiring good to excellent credit for approval.

Who Should Apply for the Target Credit Card?

Determining whether to apply for the Target REDcard depends on a couple of factors: your credit score and your financial habits. The recommended credit score needed to receive the card is between 690 and 850, a good-to-excellent score. While you can try your luck applying with a lower score, know that credit card applications may come through as a hard inquiry on your credit report, making it more challenging to gain approval from other sources immediately after.

Because the APR is significantly higher on the REDcard when compared to other cards with similar requirements, you should avoid the card if you are not intending to pay the charges off at the end of every billing cycle. Carrying the total over every month means you are incurring significant interest. However, if you shop at Target frequently and you know you can pay the bill off every month, then the in-store benefits are excellent.

When Should You Use the Target Credit Card?

While people can use low-interest credit cards on larger purchases, reserve the Target card for smaller items that you can pay off within the billing cycle. The high APR means that you may spend more on some things than necessary, entirely negating the 5% discount and primary benefit of having the card. Therefore, only use the Target card to make budgeted purchases, allowing you to save on grocery products and build your credit while avoiding accruing interest.

Examples uses

Most people find advantages in using the Target REDcard for grocery and clothing purchases. However, the card does allow for many more benefits if you know what to use it for:

  • Pharmacy purchases
  • In-store Starbucks discounts
  • Special promotions at Target Optical
  • Gifts

Steps for Getting a Target Credit Card

The application process for the Target REDcard is straightforward, and you can apply online or in-store. However, before you apply for the card, consider a few things about your circumstances:

  • What is your existing credit score?
  • Do you struggle to maintain current financial responsibilities?
  • Can you pay off balances within the billing cycle?

Quick Questions

Can a Target card help build credit?

Yes, a Target REDcard can help build credit. However, if you are not careful, it can also ruin credit, as with any credit card.

What is the initial credit limit of a Target card?

The credit limit typically varies by applicant. However, most approved users receive an initial limit of $250, which can increase over time, depending on payment history and usage.

Can you use the card immediately after approval?

You can use the credit card immediately after approval. However, you usually only are able to use it through the Target app. Once approved, you should receive an email with instructions for connecting the card with your account.

Would you like to learn more about store credit cards? Check out Credit Card Mash.