“Would you like to save 5 percent on your purchase today?” the Target store checkout clerk asked on a recent visit.
I answered automatically to the credit card offer, “No, thank you,” and signed the electronic signature pad for $71. My teenage daughter, who was standing next to me at the register, asked a question that led to a 20-minute teachable moment about personal finance: “Why did you say ‘No’?”
I never take the retail store credit card offers, I tell her. As we walked out of the store, bags in hand, I explained that store credit cards almost always have higher interest rates. Even though I don’t carry a balance and I pay my credit card bills off in full each month, that 5 percent savings still isn’t worth it to me to sign up.
Why? Unless they are co-branded with a Visa or MasterCard logo, you can only use them at the store that issued the card. I couldn’t buy gas with the Target card or use it to pay for meals at restaurants.
My daughter nodded and, I hope, absorbed what I was saying.
Financial literacy experts tell parents they need to find teachable moments to share their wisdom about money and finances to their children. Since she had asked, I took the opportunity to elaborate. I think she tunes me out when I offer unsolicited advice (parents, you know what I’m talking about).