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If you shop at department stores or mall clothing stores, you likely know how the transaction will go. The salesperson will offer a greeting, ask if you were able to find everything okay – and before ringing up your purchase, they’ll ask whether you want to open an account with the store and save 10 percent off your purchase.

I have to admit, it’s tempting, especially if you’re spending a lot of money. And I’ve fallen for this tactic many times. About ten years ago I held four store charge accounts – in addition to three major credit cards. But I was young and dumb, and I didn’t understand credit. Since then I’ve smartened up. And while I still have three store accounts (I heard it’s never a good idea to close credit accounts), they’re paid in full and I rarely use the cards. And when a salesperson tempts me with a credit card offer by waving that in-store discount in my face, I say “no.” Here’s why.

Higher Interest Rates

Savvy consumers aren’t only interested in finding the best prices on merchandise. If you have credit cards, you’re likely interested in getting the lowest rate possible. Lower rates typically equal lower minimum payments. And since a larger percentage of your payments are applied to the principle, it’s easier to pay off the balance. People with good credit can generally obtain a reasonable rate on a major credit card by simply asking. Store charge accounts work a little differently. These carry rates as high as 30 percent, and these merchants aren’t always as eager to negotiate a lower rate.

Lowers Your Credit Score

Yeah, you’ll save 10 percent on your purchase. But this discount is subject to credit approval. The merchant runs an instant credit check; and if you meet their qualifications, you’re approved. But if you don’t meet their credit requirements, they’ll deny your credit application. You won’t receive the discount, but you will receive an inquiry on your credit report. Credit inquires can kill your credit score. And applying for a store credit card can knock as much as 20 points off your score. Apply for five store credit cards and you’ve reduced your score by up to 100 points. Ouch!

Keeps You Coming Back

I don’t know what it is about store credit cards, but once you have one, you’re always tempted to shop in that store. Why tempt yourself? In actuality, as long as you have a major credit card, you really don’t need a store account. True, some stores offer cardholders additional savings and you might even receive exclusive coupons. But there’s a catch. To take advantage of these savings, you’ll often have to pay for purchases with your charge card, which is essentially a tactic to keep you in debt.

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