Home » Target REDcard Credit Card VS Target REDcard Debit Card Review
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Target REDcard Credit Card VS Target REDcard Debit Card Review

Which REDcard is better? Credit Card vs Debit Card Review

I usually don’t write credit card reviews because their high interest rate tend to contribute to debt instead of getting you out of debt. But since I am all about saving money, the Target REDcard is an exception. Mainly because of its benefits! Most credit cards have benefits, but just because a credit card offers benefits, it doesn’t mean it is worth having. The Target credit card is different however.

How does Target REDcard Work

The Target credit card is a store branded credit card – known as the REDcard – that gives you 5% back on your total purchase every time you use it. The discount is automatically applied at checkout. You don’t have to upload any receipts, or wait for a billing cycle to get your savings. With the REDcard, you save money right away.

So what else does the REDcard offer?  5% is not a lot of savings. Lets look at the REDcard more closely. Target has 2 types of cards: A Target debit card, a Target credit card, (The Target Mastercard is no longer issued, but some people still have it). They’re both used the same way, and have the same benefit. The difference is in how they are funded. In other words, how you pay off the balance on the account.

2 Types of cards:

Debit card

  • Links to your existing checking account.
  • Cash withdrawal at checkout up to $40.
  • View transactions & manage your PIN online at Target.com/myREDcard.
  • You must be at least 16 years old. (Yes, 16!)
  • No late fees
  • No interest fees
  • No annual fees
  • No credit check
  • Does not affect your credit rating

The debit card is linked to your checking account. Whenever you use it, the money is directly taken from your checking account to pay for your purchase. This option is great for consumers who don’t want to have a monthly payment. Having the debit card also keeps you from overspending, and helps you control your finances better because if the money is not in your checking account, you can’t pay for it. Is this option better for you?

Did you know a 16 year old can get a REDcard?

It is surprising that the minimum age to have a Target Debit Card is 16.  I’m glad that Target offers this option, because this is a great way to teach teens about shopping and paying with plastic instead of money. It also doesn’t affect their credit score. The spending limit can be set a low amount. This way, when they’re off to college, they have experience managing a budget.

Kiddo must have a checking account however. One can easily be opened under your account. Many banks also have safeguards for parents to control teen spending on their checking account. I highly recommend to teach them money management now rather than when they’re on their own at college.

My teen has one and is learning how to manage his own bank account. Best of all, I am not responsible for it. If there isn’t enough money in the account, he can’t withdraw it, and there are no overdraft fees. 

Credit card:

  • Charge your Target purchases in-store & at Target.com.
  • Check balance, make payments & review statements at online at Target.com/myREDcard.
  • exclusive extras, including special items, offers & 10% off coupon on your REDcard anniversary
  • Must be at least 18 years old
  • No annual fee
  • Can only be used at Target
  • Current APR: 25.15%*
  • If you are late making a payment, a $39 fee will be added to your account. How does this compare with other credit cards in your wallet?
  • Minimum interest charge $1
  • Returned payment fee: $28
  • It affects your credit rating

If you are able to pay off the full balance of your monthly statement, the credit card may be a better option because it is not attached to your checking account (unless you elect automatic payment from your checking account). If there is a data breach with anything relating to Target, your personal banking information is not affected.

However, like every credit card, if you carry a balance, you end up paying more money because of the interest. Paying the balance in full is the way to use any credit card. The credit card is a better option for the consumer who sticks to a budget, has better control of their spending habits and is able to pay the balance in full.

For me, having a credit card forces me to stick to my budget and stay within limits. I also don’t have it linked to my checking account for extra financial security. Does this describe you?

The REDcard credit cards (Target Credit Card and Target Mastercard) are issued by TD Bank USA, N.A. The REDcard Debit Card is issued by Target Corporation. The Target Mastercard is no longer issued to new applicants.

REDcard Benefits & Perks

Target’s credit/debit card benefits is in my opinion what makes this credit worth having. Used by itself it has several benefits that save money:

  • REDcard Exclusive products: Target offers certain products that can only be purchased with a REDcard. Just visit Target’s dedicated page of exclusive savings to find the latest.
  • Save an extra 5%: REDcard, shoppers save 5% on their purchase at Target & Target.com I see it as a way to save on the tax charged on the purchase. For example, if the tax rate in your state is 8%, you end up paying 3% tax on your purchase.
  • Early access to special events like Black Friday, products & other promotions.
  • Free 2-day shipping on hundreds of thousands of items at Target.com.
  • Extended returns: 30 extra days for returns Target or Target.com
  • Baby Subscriptions: Extra savings on baby subscriptions total of 15% off + free shipping on select diapers, wipes & formula subscription orders and baby registries.
  • Save 10% on subscription deals: save 5% everyday essentials delivered on your schedule when you subscribe, plus you save another 5% when you use your REDcard. Target often runs special promotions where subscribers can get more than 5% when subscribing though. So be on the lookout.
  • Stack with other Target Savings: double 5% REDcard™ savings with Target Circle (formerly Cartwheel): Use Target Circle to save between 5% to 50% on hundreds of items in stores or online, and save an extra 5% when you pay with your REDcard.
  • Get a 10% off coupon: On your anniversary, you’ll receive a 10% couponto use in store. This coupon arrives via email if you are signed up for Target marketing emails.
  • Save on Starbucks: Save 5% when you use your REDcard at any in-store Starbucks location.
  • Save at Target Cafe: Save 5% when you buy food at Target Cafe and pay with the REDcard.
  • Customized Savings: Reading the fine print on the Target promotions page, you’ll see that not everyone gets the same promotions or savings. Target offers exclusive extras based on your shopping history. Search for “Exclusive Extras” for app only deals picked for you.
  • Target App Wallet: You can use ‘Wallet’ in the Target app to link your credit card to pay. No need to pay with the physical card when you check out in store.
  • Specialty gift cards – Save 5% on specialty gift cards for travel, restaurants, movie tickets and more when you use your REDcard
  • Exclusive travel discount: Target offers travel deals for REDcard holders. A few months ago there was a nice deal on Disney tickets. Currently, you can gets a 10% discount when you pay for your hotel stay with the REDcard on Hotels.com To get the current travel exclusive log in to the Target credit card account and click on the promotional link.
  • Same day delivery with Shipt – Shipt is Target’s delivery service. You can have almost anything delivered to your door. In addition, you’ll get 5% discount on your total delivery purchase.

Target credit card frequently asked questions:

How to pay off REDcard balance? 

Both debit and credit card can be paid either in store or online

How to check credit card balance?

You can check your balance online or by calling Target at 1-800-544-2943

Does REDcard build credit score?

The debit card doesn’t build up your credit score because it is not a credit card. However, after reading about the minimum age requirement, it can be a good way for a teen to learn to manage expenses and learn to shop.

Can REDcard be used outside of Target?

Since it is a store branded card, it can’t be used at other stores. Its not like a Visa or Mastercard. It can be used at Starbucks and other services within Target stores though

Overall, the Target REDcard is a credit card that helps saves money. It is also nice to have the option  to choose between a debit and a credit card, and still get the same benefits. Unlike other credit cards that give you a discount only when you sign up, this one gives you ongoing discounts that you can stack up with other Target savings as well as other apps and double your savings. Even for the occasional shopper, in my opinion having a REDCard is a plus in your wallet.

Hope this helps bring big savings at Target

Happy savings, TaLis

target Redcard vs target debit card
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