Is the Kohl's Credit Card Worth It?

Matt is a Certified Financial Planner® and investment advisor based in Columbia, South Carolina. He writes personal finance and investment advice, and in 2017 he received the SABEW Best in Business Award.

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The Kohl’s credit card is formally known as the “Kohl’s Charge” card and is issued by Capital One. Although the Kohl’s Charge card has some pretty valuable discounts for frequent Kohl’s shoppers, there are a few key drawbacks to be aware of, such as a confusing rewards program structure and a high interest rate. Here’s a rundown of what you need to know before you consider the Kohl’s Charge credit card, so you can decide if it makes sense for you.

Benefits of the Kohl’s credit card

Rewards and discounts -- The main cardmember-exclusive benefit is discount offers. These offers are typically discounts of 15%-30% off of a purchase, and you’ll get a different one each month. Compared to many other store credit card discount programs, these savings rates are rather generous.

Although the Kohl’s credit card doesn’t have its own reward-earning program, the store’s general rewards program has a good rewards rate and the points rewards can be combined with Kohl’s Charge discounts, so it’s certainly worth considering. Kohl’s Yes2You™ rewards program gives you 1 point per dollar spent, and you get a $5 reward for every 100 points you earn. Effectively, this translates to a 5% rewards rate, which is on the high end when compared with other credit cards.

The benefits of the Kohl’s credit card can also be combined with any Kohl’s Cash you may have earned. This is a separate rewards program from Yes2You™ where shoppers earn $10 in Kohl’s Cash coupons for every $50 spent.

Introductory savings -- You’ll also get nice introductory savings when you apply. As of this writing, you get an additional 30% savings with your first purchase you make with the Kohl’s Charge card after approval. You’ll get another coupon in the mail for 15% off a subsequent purchase to be used after you receive your card.

Convenience factors -- There are also some convenience benefits to the Kohl’s credit card. For example, you can use mobile payment options through the Kohl’s app so you don’t need to bring your physical card to the store. You can also pay your bill in the store if you feel more comfortable doing that than with online or mail payment options. In addition, you don’t need to worry about saving your receipts for purchases made on the card -- you can return items purchased on your Kohl’s credit card without one.

Potential to be a MVC (Most Valuable Customer) -- If you’re a frequent Kohl’s shopper (or simply spend a lot when you go), by spending $600 by EOY, you can become a “most valuable customer,” or MVC, which gives you six extra discount offers each year, as well as monthly free shipping events.

No annual fee -- The Kohl’s Charge card has no annual fee. This is typical of store credit cards but is still worth mentioning, as many traditional credit cards charge considerable fees each year. So, as long as you don’t carry a balance, the Kohl’s Charge card won’t cost you anything.

You can pre-qualify without a hard credit inquiry -- Finally, you can pre-qualify for the Kohl’s Charge card on the company’s website without affecting your credit score -- a nice feature that is typically not available with traditional credit cards.

Drawbacks of the Kohl’s credit card

Not useful outside of Kohl’s -- To be clear, the Kohl’s Charge card is just a store credit card, meaning that it isn’t part of a major payment network such as Visa or Mastercard. So, one major drawback is that you can use the card only at Kohl’s stores and at the company’s website.

High APR -- Another big drawback is the high interest rate you’ll pay if you choose to carry a balance. If the Federal Reserve continues to raise interest rates over the next few years, as is widely expected, this interest rate will get even higher.

In contrast, the average credit card interest rate in the United States is approximately 17%. So, the Kohl’s credit card charges roughly 10 percentage points more interest than the average credit card. And, this is a one-size-fits-all interest rate that even applies to customers with excellent credit scores.

No 0% introductory APR or promotional financing -- There’s also no introductory promotional financing. With many other credit cards (traditional and store cards), new cardmembers get a 0% APR for a certain period of time. And, many store cards offer deferred-interest financing on purchases above a certain dollar amount at any time. The Kohl’s Charge card doesn’t have any special interest-saving deals.

Complex rewards program -- Finally, the rewards program is a bit more complicated than with many other store credit cards. For starters, there is no cardmember-specific program to earn points or cash back. In contrast, most other store credit cards offer some sort of exclusive rewards program, or at least a higher reward rate than non-cardmembers will earn. In order to get the best value from your Kohl’s Charge membership, you need to keep track of discount coupons, your Kohl’s Cash, and your Yes2You™ points separately. While the monthly discounts you’ll get are certainly nice, it would be better to be able to use the card’s benefits whenever you want, not just for certain time periods.

There are also some types of items that the Kohl’s Charge discounts cannot be applied to. Just to name a few, this includes fragrances, gift cards, consumables, and premium-brand apparel such as Nike, Under Armour, and more.

Other cards to consider

As you can see from the drawbacks listed in the last section, the Kohl’s Charge credit card may not be ideal for everyone. So, here are a couple of alternatives that could be better options for you for your purchases at Kohl’s -- and elsewhere.

As of Oct. 22, 2019
Discover it® Cash Back Bank of America® Cash Rewards credit card
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4.5 stars
ToolTip Icon for Star Rating. We want your money to work harder for you. Which is why our ratings are biased toward offers that deliver versatility while cutting out-of-pocket costs.
Our ratings are based on a 5 star scale. 5 stars equals Best. 4 stars equals Excellent. 3 stars equals Good. 2 stars equals Fair. 1 star equals Poor.
Apply Now
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Credit Rating Requirement: Good/Excellent Clickable tooltip icon for credit rating info.

Credit Rating Requirement: Good/Excellent Clickable tooltip icon for credit rating info.

Bonus: Double cash back in the first year Bonus: $200 after spending at least $1,000 in the first 90 days of account opening
Rewards Program: Earn 5% cash back in rotating quarterly categories you activate ($1,500 quarterly spending cap), 1% back on all else Rewards Program: Now earn 3% cash back on gas or in your choice category and 2% at grocery stores and wholesale clubs (up to $2,500 in combined choice category/grocery store/wholesale club quarterly purchases), and unlimited 1% on all other purchases.
Intro APR: Purchases: 0.00%, 14 months Balance Transfers: 0.00%, 14 months Intro APR: Purchases: 0%, 15 billing cycles Balance Transfers: 0% Intro APR for 15 billing cycles for any balance transfers made in the first 60 days
Regular APR: 13.49% - 24.49% Variable Regular APR: 15.74% - 25.74% Variable
Annual Fee: $0 Annual Fee: $0

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Highlights:

  • No annual fee
  • $200 online cash rewards bonus after you make at least $1,000 in purchases in the first 90 days of account opening
  • Earn 3% cash back in the category of your choice, 2% at grocery stores and wholesale clubs (up to $2,500 in combined choice category/grocery store/wholesale club quarterly purchases) and unlimited 1% on all other purchases
  • 0% Introductory APR for 15 billing cycles for purchases, and for any balance transfers made in the first 60 days. After the intro APR offer ends, 15.74% - 25.74% Variable APR will apply. A 3% fee (min $10) applies to all balance transfers
  • No expiration on rewards
  • If you're a Preferred Rewards member, you can earn 25% - 75% more cash back on every purchase

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Apply Now
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On Discover's Secure Website.

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On Bank of America's Secure Website.

Is it worth it?

The bottom line is that if you’re a regular shopper at Kohl’s -- either in-store or online -- the Kohl’s Charge credit card could be a smart addition to your wallet. As long as you don’t mind a fairly complex rewards and discount program, the savings available with the card can be rather generous.

I would caution readers, however, that the Kohl’s Charge card might not be the best choice for shoppers who plan to carry a balance. Even a generous 30% discount on merchandise could easily be negated by the card’s high APR if you make minimum payments and stretch your repayment out over a long period of time.

If you do plan to carry a balance, you’d probably be better off with a traditional credit card, especially one that has a 0% introductory APR offer. Keep in mind that even if you use a non-Kohl’s credit card, you can still take full advantage of the Yes2You™ and Kohl’s Cash reward programs, plus you can use the card at other merchants besides Kohl’s.

Furthermore, traditional credit cards often have their own easy-to-understand rewards programs, such as cash back or travel rewards, which you can combine with the other two Kohl’s loyalty programs. This way, you can get a more reasonable APR and can choose a rewards program that best fits your lifestyle. Unless you’re actually going to use all (or at least most) of the Kohl’s Charge monthly discount offers, this could be a preferable choice as it’s a more versatile spending option.

The bottom line is that if you plan to pay your balance in full every month and have the time and desire to shop on specific dates in order to take advantage of your card benefits, the Kohl’s Charge card is a solid credit card product. If those two conditions don’t apply to you, you may be better off looking elsewhere for a better all-around credit card.

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