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Best Buy Credit Card: Unpacking the Fine Print

You’re browsing the latest tech, eyeing a shiny new laptop – when the cashier swoops in: “Hey, why not open a Best Buy credit card today? You’ll save a bundle.”

So, what do you do? Sign on the dotted line for that limited-time discount, or politely decline? To make a smart call, let’s peel back the layers on Best Buy’s plastic…

The Alluring Signup Bonus: Upfront Savings, But At What Cost?

First, the tantalizing signup offer: get 10% back in rewards on your first purchase when you open the Best Buy credit card. Tempting, right? After all, on a $1,000 TV – that’s $100 instantly shaved off.

But here’s the rub: that one-time bonus could be a gateway drug, luring you into accumulating interest-heavy debt, fast. Because, let’s be honest – how many of us actually pay off those enticing, big-ticket buys immediately?

A Wolf in Sheep’s Clothing APR

Speaking of interest, let’s discuss the card’s preposterous APR: a hefty 27.49% variable.

To put that into perspective, the average credit card interest rate hovers around 17%. So Best Buy’s plastic carries rates that make a loan shark look ethical.

“Whoa, whoa,” you protest. “I’m a credit card superman – I never pay interest!”

Sure. But ask yourself: if an emergency rent/car repair hit tomorrow – could you truly pay that balance off in full? If not, you’re carrying a crazy-high interest rate, compounding daily.

Bottom line: Unless you diligently pay the full statement balance each month without fail, steer clear of this APR trap.

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Earning Rewards: What’s the Point(s) System?

Okay, so that signup bonus might be tempting – but what about earning ongoing rewards on purchases? After all, isn’t that the main perk of opening a retail card like Best Buy’s?

Not so fast. Let’s break down the card’s earning structure:

The “Elite Plus” Membership Paradox

To earn Best Buy’s top rewards rate – 5% back in rewards on eligible purchases, including most product categories – you need to pony up for “Elite Plus” membership at $199.99/year.

Wait, pay just to earn rewards? That’s some paradoxical perplexity right there. In fact, you’d need to spend nearly $4,000 annually before seeing any membership savings.

For most shoppers – especially frugal ones – that’s a tough sell.

Earning Without Elite? 2.5 Mediocre Points Per $1

For the non-Elite plebes among us who haven’t acquired a Scrooge McDuck-ian disposable income, the baseline earning is far less generous: 2.5 points per $1 spent at Best Buy on eligible purchases.

With each point roughly equating to $0.01 – that’s a paltry 2.5% back. Not bad, but certainly no rewards gamechanger compared to top-tier cash back cards like the Citi Double Cash that dishes out 2% everywhere – no membership fees required.

How to Use This Card Optimally (If You Insist)

Look, I’m not your mom – if you truly want to saddle up with Best Buy’s mediocre-reward/high APR steed despite the red flags, that’s your choice. But please, for your financial wellbeing – deploy these strategies:

At Least Become an “Elite” Member ($199/Year for 5% Back)

While hemorrhaging money for the privilege of earning rewards is beyond suboptimal, if you are going to open this card – do NOT skimp on the “Elite Plus” membership. Why?

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Those 5% rewards will at least allow you to recoup your $199 membership fee if you spend $4,000 or more annually at Best Buy. Spending less, you’re actively losing money on their paradoxical points system.

ALWAYS Pay That Balance Off in Full (Seriously, Every Month)

Under NO circumstance should you pay a single cent of interest to Best Buy. Their 27+% APR is a total rip-off, designed for one purpose: to bleed you dry financially.

Even if means temporarily pausing new tech purchases and aggressively knocking out card balances – do it! Because those double-digit interest charges will quickly eclipse any initial discount or cash-back earned.

Optimize With a Low-Interest Card for Larger Purchases

If you do make a sizeable purchase you’ll need some time paying down, strategically use a separate, low-interest card for that transaction.

Let that ridiculous Best Buy APR apply solely to your day-to-day small expenses – which you’ll immediately pay off. But major purchases? Safely segregate them onto another card that won’t capitalize compound-interest gougings.

The Verdict: Is Best Buy Credit Card Worth It?

Look, I’m not pulling any punches here. For most folks, signing up for Best Buy’s retail credit card is a resounding “hell no!”

Why? Well, I could summarize all the (numerous) downsides… Or I could simply ask: Would YOU knowingly buy a product with these specs:

  • Dangerously high 27% APR – with predatory interest compounding if you ever can’t pay in full
  • Lackluster rewards of 2.5% back on Best Buy purchases – unless you spend over $4,000 annually there
  • To earn the top 5% rate, you must pay $199/year just for the “privilege” of decent rewards
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For the average shopper making occasional electronics purchases, that’s a brutal list of compromises for minimal benefit. A lopsided raw deal, as I see it...

But hey, if you’re absolutely certain you’ll never pay interest while spending thousands at Best Buy perennially – go ahead and apply for the card + membership. Just realize you’re firmly within the niche target market Best Buy caters to.

For everyone else who’d rather earn solid cash-back anywhere without draconian fees and interest – there are myriad better personal and cash-back card options that deserve your hard-earned money instead.

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