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Kohl’s Credit Card: Is It Right for You?

Feb. 28, 2017
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If you live in the United States, there’s a very good chance you live near a Kohl’s department store. The company has 1,100 locations in 49 states (sorry, Hawaii). They’re best known for clothing, shoes and accessories, but they also have a robust offering of housewares, gifts and other products.

For regular shoppers, the store’s credit card is a decent choice. It has the potential to save frequent Kohl’s customers a lot of money — but getting maximum value out of the card can be complicated.

What Kohl’s credit cards are available?

The store’s credit card is called the Kohl’s Charge. It’s a “closed-loop” store card, meaning you can use it only at Kohl’s. The interest rate is quite high — 21.9% as of February 2017, so it’s not a card you’d want to carry a balance on.

Many store cards, such as the Amazon Prime Store Card, offer cardholders a discount on every purchase. The Kohl’s card is different. Instead of knocking off 5% or so at checkout, Kohl’s runs regular promotions and “secret sales” to give cardholders extra opportunities to shop at a discount. These promotions take several forms:

Kohl’s coupons

Kohl’s Charge cardholders receive a scratch-off coupon in the mail once a month. The coupons are good for 15%, 20% or 30% off their entire purchase for a limited time. The company says the discount amount is random, but some Kohl’s devotees (including my sister) will say they get better coupons if they shop at the store more often. Usually the coupons are valid for only a limited time, starting a few days after they arrive in the mail.

Kohl’s Cash

Kohl’s frequently runs promotions in which shoppers get a $10 coupon for every $50 they spend. The coupons are handed out at the time of purchase, but they’re not active until several days later. This way, shoppers have to come back to the store rather than just turn around and spend the money right away.

Yes2You Rewards

The company’s rewards program pays points when you make purchases in a Kohl’s store or online. The points can be exchanged for coupons. You don’t have to be a Kohl’s Charge cardholder to participate in the program.

Other sales

Although most of them are not exclusive to Kohl’s Charge customers, Kohl’s does run other sale events. Customers are notified via email alerts, mailers, in-store signs and sometimes scratch-off coupons available at the register.

Should you get a Kohl’s credit card?

Having a Kohl’s Charge makes shopping there easier. Returns are smooth, even without a receipt, because the sales associates can look up your purchase history in their database. Forgot your card at home? They can verify your account information, check your ID, and let you charge things anyway.

The discounts, too, can be significant. Budget-conscious shoppers who wait for sales and get lucky with an especially good scratch-off coupon can buy clothes for a fraction of what the price tags say.

But to shop at Kohl’s effectively, you have to become an expert. You also need to shop with a calculator in your hand — or be insanely good at math.

Let’s say you got a monthly coupon in the mail giving you 30% off. You also have a $10 Kohl’s Cash coupon to spend, and it’s about time you cashed in some Yes2You Rewards points, so that gives you another $5 coupon. One of your coupons expires on Thursday and the other one can’t be used until Tuesday, but you manage to get there on Wednesday. When you get to the store, you see it’s running a sale on luggage, with everything marked down 20%. You find a suitcase you like that was originally priced at $79.99. How much will the suitcase cost you today?

We’ll give you a minute.

You’ll end up paying only $36.39, plus tax, for that suitcase. That’s a great deal, and one you could get only with the Kohl’s Charge. But to get it, you have to keep track of a lot of moving parts.

The complexity of the sales, promotions, rewards programs and discounts is the biggest weakness of an otherwise good store credit card. But if you get a rush from scoring the absolute best deal when you shop, and you don’t mind crunching numbers to get it, the Kohl’s Charge is a great way to save money on clothes and household goods.

» MORE: How to maximize credit card rewards when shopping

Alternatives to a Kohl’s credit card

If you don’t shop at Kohl’s very often, or don’t want to deal with all the sales and gimmicks, there are other credit cards out there.

» MORE: Credit card offers for department store shoppers

The Discover it® Cash Back pays 5% back in rotating quarterly bonus categories that you activate, on up to $1,500 per quarter in spending, and 1% back on everything else. Department stores have historically been among the bonus categories. Find the current categories here. The annual fee is $0.

The Chase Freedom® has the same rewards structure as the Discover it® Cash Back. It, too, has historically included department stores among its rotating quarterly 5% categories. Often, this is the bonus category in effect during the holiday shopping season. The annual fee is $0.

» MORE: NerdWallet’s best store credit cards

Information related to the Kohl’s Charge and the Amazon Prime Store Card has been collected by NerdWallet and has not been reviewed or provided by the issuers of these cards.

Virginia C. McGuire is a staff writer at NerdWallet, a personal finance website. Email: [email protected] Twitter: @vcmcguire.