As we jump into the 2nd month of 2012 I thought it would be fun to look at some ways to keep your finances in tip-top shape by avoiding one of the the biggest pitfalls: In-Store Credit Cards. I’ve enlisted guest poster Samantha Peters who is an active blogger who frequently writes about topics relating to money and personal finance. Sam lives in beautiful San Diego, California with her dog Leona.

Reasons to Avoid In-Store Credit Cards

We’ve all been offered an in-store credit card by an employee at one of our favorite big box or retail stores, and I’m sure a few of us have even considered signing up for one. You shop there often, you can get an in-store discount, so why not? Well, before you decide to pull out an in-store card, consider the following reasons that you should ultimately avoid them:

You WILL Spend More

With an in-store card, you are only given perks when you shop more in-store. Not only can this quickly lead to a higher credit card bill than you wanted, but it can also cause you to blow your budget simply in pursuit of a seemingly larger discount at the time of purchase.

The Discounts Aren’t Good

The discounts offered by in-store cards can only be used in-store, and are generally only 5 percent off each purchase you make – which isn’t a whole lot if you shop reasonably. If you are worried about missing out on a 5 percent discount, wait to do your shopping over the weekend and nab the 20 percent off coupon the store is sure to offer in the Sunday paper. You’ll avoid additional credit, and still get the discount you wanted.

However, if you truly are interested in getting cash back for your credit purchases, look into the best cash back rewards credit cards. You’ll get money back on numerous types of purchases, and many rewards programs allow you to use your rewards however you see fit.

Can Only Be Used in One Place

Forget racking up airlines miles or getting cash back rewards that you can use however you see fit. With an in-store card, you can only use it in-store and the benefits you receive can only be used to buy more in-store. So forget about using it while traveling abroad – you’d be better off securing one of many good airline credit cards with no annual fee.

Aren’t Attached to a Major Creditor

Unless you see Visa or Mastercard listed on the card, the in-store card you are interested in having doesn’t have much pull in terms of building or maintaining your credit. There is a reason why most major creditors look to major credit card companies when trying to determine a person’s creditworthiness – because they are the most legitimate. They also offer better interest rates. If you are interested in getting a card that will benefit your credit score, then get one with a major credit card company’s logo on it – not one with only a store logo.

A good credit card is something we should all have to build and maintain our credit, and unfortunately in-store cards, unless they are attached to a major credit card company, aren’t considered good cards. Their benefits are few and they can only be used in one location, robbing you off the purchasing and perk freedom that other cards offer. So the next time you are offered an in-store card, politely decline and grab a paper to get the discounts you want.