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Kohls And Menards, You've Got My Interest
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Post Kohls And Menards, You've Got My Interest 
I used to be a regular shopper at Kohls and Menards, but I'm cooling off on them fast. Why? Because I think they deliberately exploit their customers.

Kohls is a steeply discounted clothing store, and markets itself heavily to low income customers. They offer a store charge card, and with it offer lots of special discounts and early bird sales. But to keep the special customer status that entitles you to those deals, you have to spend at least $600 per year on their card. Not spend $600, mind you. You have to charge it, at their current 21.90% interest rate.

Menards is a home improvement store that offers the Menards Big Card. They offer a 1% rebate on purchases, and lots of "same as cash" deals for big ticket purchases. But the best deals they offer require that the purchase be made on the card, not by cash or debit. Their interest rate? 21.98%.

Seems pretty obvious to me that both of these companies are hoping that you will not pay off your balance on time, and will be subject to their interest rates for as long as possible. I'd be fine with the practice if they just let you show your card and then pay cash, but that's not possible. The discount's supposed to recognize you as a frequent customer, so why should they care how you pay as long as you regularly buy their products and can document that by showing your "loyalty card" and not charging?

Informed consumer, blah blah blah. This is predatory lending.



Last edited by thrice on Fri Sep 18, 2009 11:26 am; edited 2 times in total
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I think the majority of retail stores do this kind of thing. It seems like everywhere I go, if I make a purchase at a store, the cashier is trained to ask me if I'd like to save 10% by opening a card with their store. I always decline. They're bad news.

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Post Consumers Union Credit For Dummies 
What the Banks Don't Want You to Know: Banks Keeping You in the Dark About the Real Cost of Debt

On December 23, 2002, five large national banks and trade associations for banks and credit unions persuaded a federal judge to throw out a law passed by the California state legislature to give consumers more information about the high cost of credit card debt.

The California Legislature wanted credit card bills to tell you that if you make only the minimum payment on your credit card it will take decades to repay and end up costing you far more in interest than the amount of the balance.

Here is what the Legislature wanted consumers to know. Based on an interest rate of 17% and a minimum payment of 2 percent of the balance:
Minimum Payment Warning: Making only the minimum payment will increase
the interest you pay and the time it takes to repay your balance.

Balance Total Cost Total Time to Repay
$1,000 $2,590.35 17 years & 3 months
$2,500 $7,733.49 30 years & 3 months
$5,000 $16,305.34 40 years & 2 months

These numbers will change if your interest rate is different, or if you make more than the minimum payment. If you make new credit card purchases or incur fees such as late fees, over-limit fees, or cash advance fees, it could take even longer and cost even more to repay a credit card balance.

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dorajar wrote:
I think the majority of retail stores do this kind of thing. It seems like everywhere I go, if I make a purchase at a store, the cashier is trained to ask me if I'd like to save 10% by opening a card with their store. I always decline. They're bad news.


Yeah, never a card. But like Border's and Best Buy have little reward cards that you just scan at the register and pay however you want to and you get nifty little benefits.

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Shrug.

Kohl's is a great store.

Excellent prices. Excellent return policy. Pay with your card and pay it in full each month. No problem.

Pay anywhere, with any card, and don't pay it in full each month? Blame yourself.

If you can't handle credit cards, get on a cash basis with everything. Put your cash into envelopes, one for food, one for clothes, one for rent, etc... when the envelope is empty, you're done for the month with that category.

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Yeah it's fairly simple, dealing with cards. But I think the idea is "Do you really want to support a store that practices predatory credit?" There are other stores out in the world that have cards that don't charge 20+% interest, why do they?

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Lots of credit card companies charge the same rate. I'd like to see usury laws come back. Anything more than 6 to 10% should be against the law. Some people don't deserve credit. If you're too much of a risk to get these rates, you should be denied credit. You do not have a constitutional right to a Mortgage, Car loan, Visa, Mastercard, and American Express.

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citizenx wrote:
Lots of credit card companies charge the same rate. I'd like to see usury laws come back. Anything more than 6 to 10% should be against the law. Some people don't deserve credit. If you're too much of a risk to get these rates, you should be denied credit. You do not have a constitutional right to a Mortgage, Car loan, Visa, Mastercard, and American Express.


Nail, head, hammer.

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