Sky High Interest Rates & Paltry Perks
Sears Premier Gold MasterCard
I have had a Sears credit card for many years but only really started using it when my husband and I purchased our home. Sears had now become the "go to" store for our major household appliances and lawn and garden items. Since the interest rate on our regular Sears card for purchases was the Prime Rate plus 17.15% (25.40% today), we would pay it off immediately when we received the bill to avoid a whopping finance charge. For larger purchases, we would only use this card when Sears had a special promotional rate or a no interest/no payments deal.
About a year ago, we received a letter from Sears stating that we had earned Premier Status by charging at least $600 in the past twelve months and for remaining in good standing. Included with the letter were two brand new shiny Sears Premier Gold MasterCard charge cards. We now had to figure out what the benefits were to having this premier status.
Premier Status
The first thing we did when we received the new credit cards was check the interest rate. The rate for the premier account on purchases was the Prime Rate plus 13.33% (21.58% today). The rate for cash advances was the Prime Rate plus 16.25% (24.50%). We were pleased to see that the interest rate was lower than the basic Sears card but still not a low enough rate that we would carry a balance on the card.
The premier status supposedly entitles us to receive exclusive offers and coupons designed specifically for my family and me. We have received offers for balance transfers with preferred rates and a few coupons here and there, but really not much to get too excited about. The letter also stated that another benefit of our new status was invitations to premier events so we could shop for the latest products and newest fashions before anyone else even knew they were available. Honestly, in the year that we have had the new card, I don't recall receiving any such invitations.
Gold MasterCard
On the positive side, there is no annual fee and we do have the ability to use this credit card anywhere that MasterCard is accepted. We can also use it for cash access at thousands of ATM and branch banks all over the world. These are great options to have but we still won't use this card unless we know for sure that we will be able to pay the balance off in full. The rate is much too high and the finance charges would be frightful!
Sears Choice Rewards
With the Gold MasterCard, we have the opportunity to sign up for Sears Choice Rewards. According to the material we received, this program allows us to earn points on eligible purchases which can be redeemed for Sears gift certificates and merchandise, gift cards to restaurants, round-trip airline tickets, and other travel rewards.
After reading further through the program details, we learned that the first year's enrollment would be $1.00 but then we would be charged $25.00 or the then-current rate each year unless we cancelled. At first, we thought that it might be a good idea. After all, it was only a dollar for the first year. I began looking further into how many points per dollar would be earned and how many points we needed before we qualified for a reward, I realized that this was not a program that would benefit us.
According to the program details, upon sign up, 100 bonus points would be rewarded to us and then we would begin to earn 1 point for every dollar we spent thereafter. It sounded tempting until I actually looked up the rewards. There were many different rewards to choose from, but the points that were needed to qualify for even the lowest level reward were 1,000, which of course equates to spending $1,000 or $900 using the bonus points. The 1,000 point prize was a $10 Kmart or Sears Gift Certificate.
The next level up was 2,500 points, which qualifies you for $15 or $20 gift card to various places. In our case, we would not spend anywhere near the amount needed to earn these miniscule rewards and it wasn't worth the mere dollar to apply.
Free Benefits
There are other key benefits to having this Gold MasterCard such as, $0 liability on unauthorized purchases, returns without a receipt, and a temporary shopping pass if you forget your card (at Sears and Kmart stores only).
No Interest/No Payments
From time to time, Sears will advertise the no interest/no payments offer for 12 months. This is the one benefit that I keep my card for. It is important to note that even though it says no interest, the meter is ticking and interest is accruing at the very high rate of Prime plus 13.33%. If you don't pay off the total amount by the end of the "no required payment" period, then you have to pay all the interest that has accrued on the total amount of the charge from day one.
Other Options Available for Purchase or a Fee
Balance Transfers
At different times throughout the year, low interest balance transfer offers are available. Be sure to read the fine print because they charge a 3% fee with a maximum fee of $50 for this service.
Account Care
Enrolling in the optional AccountCare, your Sears account minimum monthly payment, up to $500, will be cancelled during job loss, disability, leave of absence, or hospitalization. The fee for AccountCare is just $0.96 per $100 of the Account Balance shown on your billing statement each billing period. If you don't have an Account Balance shown on your new statement, you won't be charged at all.
I suppose if I used my card more, this may be an option I might purchase. There is a lot of fine print to read though before I would make any final decision to purchase.
Life and Health Insurance
Sears Life Accidental Death Insurance, Hospital Indemnity Insurance, and Term Life Insurance are optional and can be purchased by calling a toll free number. Pricing varies upon individual circumstances and choices.
Both of these optional benefits are available with the regular Sears Card as well.
My Final Thoughts
Although the Sears Premier Gold MasterCard does have many options, we have only used this card to purchase some major appliances at Sears under the no payments/no interest for twelve months offer. This program has worked out well for us thus far and we have not had any issues or problems. We are carefully watching our statements, which reflect the expiration date of this offer so that we will be sure to pay the balance off in time. I have contacted customer service twice for questions regarding the no interest/no payments program and about a balance transfer offer. Each time, I had a very pleasant experience. Since customer service is available 24/7, I could call whenever I wanted and the people that I spoke with each time were very well informed and friendly.
I would recommend this credit card to those who intend to pay their balance off in full each month or who intend to take advantage of the no interest/no payments or balance transfer offers. I would not recommend it to those that intend to carry a balance each month.
There are plenty of credit card options out there and you no doubt will be able to find one with a much lower interest rate. Be careful of the initial teaser rates because often once those rates expire, the interest rate will sky rocket.
