About Target REDcard
The Target REDcard is a credit card offered by Target that gives its users discounts on Target purchases as well as several other perks that loyalists of the big-box store will enjoy.
For those who shop at Target, the REDcard might be a no-brainer. But, before you jump into the application, let’s take a moment to think about the bigger picture.
Will this card really give you more benefits than what you could get with a non-store credit card? How valuable are the rewards and extra perks of the REDcard? Are those features good enough to balance out the card’s shortcomings?
These are the questions we should all ask before signing up for a financial product, even if it’s something as simple as a store credit card. While the implications of our choices may seem insignificant, one financial emergency can turn balances we normally pay off into interest-bearing leaks that slowly eat away at our income.
Another important factor is that store cards are popular around the holidays, a time when many consumers spend more than they anticipate and end up in debt as they move into the new year.
With all this in mind, we created this review as a way for you to make a wise choice about whether or not the Target REDcard is right for you.
Pro tip: Target offers a REDcard debit card and MasterCard, too. This review only covers the Target credit card, not the debit card or MasterCard.
The Target REDcard’s Rewards
Store credit cards specialize in providing the biggest discounts and rewards rates for purchases made at their stores.
The REDcard follows that tradition by giving you some solid rewards rates for the purchases you make at Target. But that’s not the card’s only rewards strength; there are several other interesting things the store’s loyalists will love.
5% Back on Target Purchases
Every time you use your card to buy something at Target or Target.com, you’ll automatically get 5% taken off your purchases. Consider it a 5%-off sale on everything you buy with your card.
What’s unique about this reward is that most cards – store and non-store – give you rewards rates that can be redeemed on your credit card statement with a few clicks. That method is easy to manage, but not nearly as easy as an automatic 5% off whenever you swipe your card or enter its number at checkout.
Now, this rewards rate has some exceptions to it. First, if you pay for a transaction with your card and a gift card, for example, you only get the 5% off the total you pay with your credit card.
Second, Target’s fine print reveals certain brands and purchase types that don’t get the 5% discount. Here’s a list of some of them:
- Prescriptions and over-the-counter medicine available behind the pharmacy counter
- Target gift cards
- Gift wrapping and shipping/handling charges from Target.com
- Target eye exams
- Some restaurants in Target stores
Here’s the good news, though: You get a 5% discount when you use your card at Starbucks location inside Target stores.
10% on your Cardmember Anniversary
Every year, Target will give you a 10%-off coupon you can use on a purchase you make online or in a Target store. The only catch to this benefit is that, according to the fine print, you have to be signed up for Target’s marketing emails in order to get the discount.
10% off Target Subscriptions
Target’s subscription program sends you items of your choosing on a monthly basis, a great idea for things like diapers, soap, paper towels, coffee and other items we tend to use up on a monthly basis. The service allows you to get deliveries every 4 weeks and less often in increments of 2 weeks (6 weeks, 8 weeks, etc.).
You’ll get 5% when you get the items via subscriptions and then an extra 5% off when you use your REDcard.
In reality, this 10% discount is just a 5% discount everyone gets for subscribing plus the standard 5% off you get on Target purchases.
The Target REDcard’s Benefits
A credit card’s benefits tend to be those things that you get without having to spend any money, sort of like perks you get by virtue of being a customer.
Based on our research, we believe the card’s benefits are actually better than its rewards.
Whenever you use your Target REDcard to make an online purchase that’s shipped to the 50 states, APR/FPO addresses, and Puerto Rico, you’ll get free shipping.
The free shipping you get is standard shipping and, according to Target’s fine print, you’ll have to pay extra if you want your item to arrive quicker.
We also discovered that certain items will require a minimum purchase in order to get free shipping. However, the fine print didn’t say which items those were.
You might also be charged a handling fee for certain items, but there are situations where you can avoid the handling fee by ordering the item for store pickup.
Whenever you use your card to buy things from Target, you’ll be given an extra 30 days to make returns. So, if an item has a 15-day return period, you’ll get 45 days.
Just like free shipping, there are some exceptions to this benefit:
- Doesn’t apply to Target Mobile purchases
- Isn’t good for purchases with fixed return dates
- Won’t apply to non-returnable items like DVDs
Early Access to Black Friday Deals
As we mentioned earlier, store credit cards are a big deal around the holidays because stores tend to push bigger up-front discounts and perks to reel in customers who plan on spending a lot of money at said stores.
While Target was not, at the time of publishing, offering holiday-specific discounts or cash back, it did offer exclusive access to certain Black Friday sales.
The fine print says that you’ll get access to the offers on November 22 around midnight. Remember, you’ll only have access to select Black Friday offers for REDcard customers, not all Black Friday deals.
Another interesting part of the early access is that the discounts you get can’t be combined with any other discounts unless those discounts are greater than the early offer discount. If that’s the case, the bigger discount applies but they can’t be stacked.
Also, some items will have limits on how many you can buy.
Pro tip: This benefit is only available online.
The Target REDcard’s Rates and Fees
This card’s standard APR is 23.90%, which means that anytime you don’t pay off your entire balance you’ll be charged interest on what’s left and any purchases made until you pay everything off.
This APR is really high considering that it’s what you’d get if you had excellent credit (750+) or bad credit (620 or below). For cash-back cards like the Discover it Cash, excellent credit gets you an interest rate below 12%, which is twice as good as the REDcard.
If you make a late payment, you’ll be charged up to $38 and if you have a returned payment it will cost you up to $27.
Public Opinion About the Target REDcard
We did a quick search of expert and consume reviews of the REDcard and found some interesting data. First, most of what we found was either really good or really bad, resulting in average ratings.
For example, one site’s user reviews were pretty much split between 5 stars and 1 star. Many of the positive reviews we saw noted that Target increased their credit limits rather quickly, in one case going from $200 to $5,000.
Complaints ranged from equally as snappy credit limit decreases to sudden closures due to inactivity.
Pros of the Target REDcard
We believe the card’s strengths are that the 5% discount is taken off at the register, a method of rewards that competing credit cards from Walmart don’t offer.
In addition to this, we think that the early access to Black Friday deals is excellent for shoppers who spend most of their holiday budget at Target. And because the early access is online-only, you can avoid the stress of an in-store Black Friday experience.
Cons of the Target REDcard
The biggest drawback of this card is that it has a really high APR. This isn’t unusual for store cards but it is a rarity among non-store cards.
Another drawback is the fact that you can’t earn rewards anywhere else but Target since you can only use the card at Target. Walmart Credit Card, for example, gives you 2% back on Walmart and Murphy Gas USA purchases. Best Buy has bonuses for gas, groceries, and restaurants.
Who This Card Is Best For
Based on our research, we believe that shoppers who spend a significant amount of money each month and do their holiday shopping at Target will get the most benefit out of this card. The 5% discount is excellent and access to Black Friday deals is a relief.
However, this recommendation comes with an important caveat. If you tend to carry balances on your credit card, there’s a good chance that the interest you pay on your balances will cancel out the money you save by using your REDcard.
If you aren’t convinced this card is right for you, check out our overview of the best cash back credit cards of 2017. These cards give you a cash reward for nearly every purchase you make. Those rewards are kept as a running balance that you can redeem for statement credits and, in some cases, frequent flyer or hotel loyalty points.