Target REDcard™ review: Is this Target credit card worth it for frequent shoppers?

Woman searching for clothes to purchase with her Target REDcard credit card Woman searching for clothes to purchase with her Target REDcard credit card Image:

In a Nutshell

Target shoppers could save 5% on purchases with the Target REDcard™ credit card. And with no annual fee, it could be a great choice for Target fans — as long as they don't get trapped by the high variable purchase APR of 25.15%.

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Target shoppers could hit the bull’s-eye with the Target REDcard™.

From our partner

Target REDcard™

From cardholders in the last year

See Details, Rates & Fees

Though store credit cards generally come with as many cons as pros, this one offers some tangible, long-lasting incentives. Cardholders receive a 5% discount on most Target purchases, plus free shipping on most online orders and 30 extra days for returns.

As with most store credit cards, however, this one comes with a high variable APR for purchases. If you carry a credit card balance, your savings could be wiped out by the hefty 25.15% variable interest rate on purchases.

It’s also important to keep in mind that the Target REDcard™ can only be used at Target stores and on Target.com. If you’re looking for an all-purpose credit card, we recommend a more flexible cash back option like Chase Freedom®.

Let’s take a closer look to see if the Target REDcard™ is right for you.

What we like Heads up
  • 5% discount on most purchases at Target stores and Target.com
  • Free standard shipping on most items at Target.com
  • 30 extra days for returns
  • No annual fee
  • High variable APR for purchases
  • No weekend delivery for standard free shipping
  • Can only be used at Target stores and Target.com

  1. The rundown: Everything we like about the Target REDcard™
  2. Heads up: What you should consider before applying for the Target REDcard™
  3. Do the math: How to get the most out of the Target REDcard™
  4. The competition: How the Target REDcard™ stacks up against similar cards
  5. Bottom line: Is the Target REDcard™ right for you?
  6. Reviews roundup: What our members say about Target REDcard™

The rundown: Everything we like about the Target REDcard™

The Target REDcard™ offers Target shoppers plenty of ways to save at checkout, all without an annual fee. Here’s what we like most about it:

Everyday 5% discount

Target shoppers enjoy a 5% discount on most in-store and online purchases — including products that are already on sale — when they pay with their Target REDcard™.

Typically, even the best cash back credit cards, like Chase Freedom® and the Discover it® Card, don’t offer more than 5% back on select purchases, and they may limit how much you can earn with spending caps. But the Target REDcard™ offers a 5% discount year-round on most Target purchases with no cap.

To sweeten the deal, Target offers the 5% discount immediately at checkout.

Savings stacked on savings

Target also offers several other ways to save money:

  • Did we mention the 5% discount also applies at all Starbucks coffee shops located inside Target stores?
  • Target REDcard™ cardholders can also receive a 10% off coupon each year on their account anniversary. To qualify, cardholders must be signed up for marketing emails from Target, and the Target REDcard™ must be in good standing.
  • You can sign up for Target’s Cartwheel app to save between 5% and 50% on hundreds of items in stores, and save an extra 5% when you pay with your Target REDcard™. According to Target, Cartwheel has saved customers more than $1.1 billion since it was launched.
  • While you’re at it, why not save a trip to the store? You can set up a Target subscription to deliver “everyday essentials” like groceries, laundry detergent and toilet paper straight to your home. Target offers a 5% discount and free shipping on subscription orders.

The best part? If you pay with your Target REDcard™, these Cartwheel and subscription discounts will be stacked on top of the 5% discount you already get with your card.

Free shipping on Target orders

Target.com typically charges $5.99 for standard shipping on orders under $35. But that fee is waived for purchases made with the Target REDcard™.

Keep in mind, cardholders may still be charged to upgrade to premium or express shipping. Additionally, certain items may require a minimum purchase threshold before the purchase ships.

Extended returns

Ever have second thoughts about the purchases you make?

If so, you’re not alone. According to a 2017 Credit Karma survey, 83% of consumers who spent money to cope with stress said they at least occasionally regret those purchases.

Fortunately, if you use your Target REDcard™ and later change your mind, you’ll have an additional 30 days to return those purchases on top of the store’s regular 90-day return policy. That’s four months!

No annual fee

Target REDcard™ has no annual fee, making it a potentially great value as long as you pay off your balance in full each month.

Hard and soft credit inquiries: What they are and why they matter

Heads up: What you should consider before applying for the Target REDcard™

There are a few drawbacks you should watch out for before applying for the Target REDcard™:

You better like shopping at Target

The Target REDcard™ offers exceptional value, but only for a limited number of shoppers. Not only will you receive no rewards for shopping at other stores, but you can’t even use the card outside of Target.

The good news is, even if you don’t live near a bricks-and-mortar Target store, you can still benefit from the Target REDcard™ because many of the same discounts apply when you shop online at Target.com.

Don’t spend more than you can afford

This card’s generous 5% discount may encourage Target shoppers to spend more than they can afford, because they think they’re getting a good deal.

Unfortunately, like most store credit cards, the Target REDcard™ charges a hefty interest rate (in this case, it’s a 25.15% variable APR for purchases). You shouldn’t even consider this card if there’s a chance you’ll spend too much and carry a balance from month to month.

Be patient with shipping

Target’s free shipping offer is a far cry from Amazon Prime’s speedy shipping policy.

With the Target REDcard™, you’ll receive free standard shipping for online orders, but it could take more than three to five business days to arrive. Not to mention, standard shipping doesn’t include weekend delivery. If you want faster shipping, you’ll need to pay for Target’s premium or express service.

Keep in mind, Target also offers free standard shipping to non-cardholders when they spend at least $35 online, so you may qualify even without the card. On the other hand, Target may require a $25 minimum order before it will ship most online orders, even if you purchase with your store card.

Therefore, in some cases the free shipping offered by the Target REDcard™ may only benefit people who spend more than $25 but less than $35 per order.

No sign-up bonus

Unlike many cash back and rewards credit cards, the Target REDcard™ doesn’t offer a sign-up bonus. Think of this card more as a way to reduce your shopping expenses, as opposed to earning cash back or travel rewards.

Do the math: How to get the most out of the Target REDcard™

Frequent Target shoppers will get the most out of this card if they stack their discounts with the Cartwheel app and pay off their credit card balance in full and on time each month. Here are some general guidelines to follow:

Do all your shopping at Target

To get the most out of the Target REDcard™, we recommend using Target as a one-stop shop for as many necessary purchases as you can.

For example, let’s say you spend $400 on groceries each month.

With your current rewards credit card, you may receive 2% cash back on those groceries. That’s $8 each month in cash back.

Now, suppose you start buying all your groceries at Target with your Target REDcard™. Factoring in the 5% discount, you’ll score a $20 monthly discount on those purchases.

Now, $20 may not sound like much more than $8. But over the course of a year, that adds up to an extra $144 in savings!

Watch out for the high interest rate

The Target REDcard™ is great for cardholders who pay off their credit card balance in full and on time each month. Just keep in mind that if you carry a balance, the 5% discount pales in comparison to the 25.15% variable APR for purchases.

The competition: How the Target REDcard™ stacks up against similar cards

Amazon Prime Rewards Visa Signature Card Fast shipping
Amazon Prime Store Card Low promotional interest rate
Discover it® Card High rewards rate

 

The Target REDcard™ is great for Target shoppers, but there are several other credit cards that offer faster shipping, bigger discounts, lower promotional interest rates or more flexibility.

Amazon credit cards

Amazon’s two credit cards edge out the Target REDcard™ with faster free shipping.

Both the Amazon Prime Rewards Visa Signature Card and Amazon Prime Store Card feature two-day shipping for Prime members, including weekend delivery.

For a full breakdown of Amazon’s credit card offerings, check out our side-by-side comparison of Amazon credit cards.

Discover it® Card

The Discover it® Card can be used at thousands of stores, including Amazon.com and Walmart locations.

Similar to the Target REDcard™, the Discover it® Card offers 5% cash back, but only in rotating categories up to a quarterly maximum each quarter you activate, then 1% cash back on all other purchases. So depending on your spending habits, you may not be able to earn bonus rewards consistently throughout the year.

Where this card really shines is the cash back match. The Discover it® Card automatically matches all the cash back you’ve earned at the end of your first year. So, essentially, you’re earning 10% cash back up to a quarterly maximum every time you spend in a bonus category when you activate in your first year. You’ll also earn 1% cash back on all other purchases with the Discover it® Card.


Bottom line: Is the Target REDcard™ right for you?

The Target REDcard™ could put a little extra cash back in your wallet every month. Just make sure you don’t carry a balance and are willing to commit to shopping at one store for most of your essential purchases.

If that sounds like you, then you’re right on target.


Reviews roundup: What our members say about Target REDcard™

“I have no complaints”

★★★★★

Dec 23, 2017

I’m in the process of rebuilding my credit. I applied for this card and I was approved online. I believe my starting CL was $500 and that was in February 2017. I do a lot of shopping at Target and I love the fact that if you make a purchase online the shipping is free, and fast too. I’ve received a few cl increases during the last 10 months. As my credit has gotten better and income has grown, my new limit is $2900. I’m rather pleased with that. Not really looking forward to anymore increases for now but this card is worth it.

–Credit Karma user Coreyboy

“Really my favorite card”

★★★★★

Dec 21, 2017

I shop at Target constantly so after rebuilding my credit to about 600 I applied for their Red Card. Was approved for a small amount, I think about $350. However, over the course of the last year they have given frequent increases and it now sits at a $2000 limit. My credit has flucuated from 600-660 but it seems like the credit increases always come when I get close to my limit. I try to pay it off but I did carry a $1500 balance for 2 months and that is when they bumped it to $2000. I’ve never had a single problem and really enjoy the 5% off.

–Credit Karma user wanderingnobody

“Easy application Low CL”

★★★★

Dec 20, 2017

Easy app online. Low CL of $200 with scores in mid 600’s. Hoping it grows.

–Credit Karma user CredSeeker123

 

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