It's all debt, you know...

I had a conversation with someone the other day who had what I think is a pretty common misperception about store loyalty cards.  You know those cards, right?  You're about to buy something from some department store or other big box retailer and they give you a 10% discount if you sign up for their card.  Sounds like a great program, right?  Sign up and you save all sorts of money.

Of course you know they are trying to get you to shop more at that store.  But what a lot of people don't seem to understand is that those cards are debt, just like a credit card.  Every time you use it, you are increasing your overall debt load.  Problem is, sometimes when people carry very small balances on these different cards, they don't think of them as important.  Or at least not as important as say their Amex or MasterCard.  But you need to pay these off just as regularly as any other debt.  If you don't pay these cards, even if it's only a few bucks a month, they go into default and you trash your credit score.

Many of you probably already know this.  But I know for a fact that some of you don't.  Your best bet?  Get rid of all these cards over time by paying them off.  Look through prior blog posts here for strategies to pay down debt.

Good luck, and peace!