The Target REDcard gives frequent Target shoppers the chance to save 5% on everything they purchase at Target or Target.com, more than nearly any other card will offer. If you do most of your grocery and other shopping at Target, that can be worth hundreds of dollars per year.

The biggest downside of the card is that it is a store card, so it can only be used for purchases at Target, making it an inflexible choice if you shop at multiple stores regularly.

Target REDcard Review

Here are the highlights of the Target REDcard:

  • Save 5% on all purchases at Target and Target.com
  • No annual fee
  • Get perks like early access to hot items and additional discounts
  • Extended return program
  • Store card – cannot be used anywhere but Target

There is also a Target REDcard debit card available, and it offers similar benefits. This review will focus on the Target REDcard credit card.

Why Apply for the Target REDcard?

There are a few reasons you may want to get the Target REDcard.

You do a lot of shopping at Target and on Target.com
If you do most of your shopping at Target or Target.com, the Target REDcard is a no-brainer. You can buy nearly everything you need at Target, from electronics and home goods to groceries and clothing. The Target REDcard gives you an automatic 5% cash back on every purchase you make.

You buy groceries at Target
The USDA estimates that a family of four that budgets a moderate amount for food spends just over $200 per week on groceries. If you do all your grocery shopping at Target, you’ll net an additional $10 in cash back per week or $520 per year. That’s a huge amount to save just by getting one credit card. Plus, that doesn’t account for the savings on other purchases you make at Target.

You want to pre-order products and get additional return protections
People who frequently shop at Target can also take advantage of the Target REDcard’s other perks, such as the ability to pre-order certain high-demand products. Cardholders get extended return protection, offering an additional 30 days to return items for a refund. Plus, coffee drinkers can earn 5% back on Starbucks purchases at Target stores. (That even beats the Starbucks Credit Card.)

You want to sign up for Target subscription services
There are many consumable goods that people order on a regular schedule like diapers, paper towels, laundry detergent, and toothpaste. These are great candidates for subscription services because most people know roughly how often they need to restock.

Target lets you subscribe to automatic monthly deliveries of these items, offering a 5% discount on products you subscribe to — even if you don’t have the Target REDcard. With the card, you’ll get an additional 5% discount, resulting in a total savings of 10%.

You can also use your Target REDcard login to check for additional discounts. When you check the online portal, you may see special offers for certain products. For example, at the time of writing you can save a total of 15% when you subscribe to deliveries of certain baby products.

Target REDcard: Drawbacks and Downsides

If you’re considering the Target REDcard you should also be aware of the card’s drawbacks.

Clutter your wallet with an inflexible card
The Target REDcard is a store credit card, which means you can only use it at Target. So, if you have the TargetREDcard, you’ll have to carry around additional cards if you plan to shop at stores other than Target.

You also have to account for the impact that applying for a new card has on your credit. If you’re worried that you’ll only be able to qualify for one new card, you’ll probably want a more flexible card that can be used at any store.

Hefty interest rate
One major reason to avoid the Target REDcard is the fact that it charges a high interest rate. When you get your Target REDcard statement, be sure to pay in full. Otherwise, you’ll have to pay interest charges.

While you should avoid paying interest on credit cards as a general rule, sometimes you may not have a choice. If you think you’re more apt to carry a balance on your card, you’ll want to apply for one that carries a lower interest rate than the Target REDcard.

Target REDcard Alternatives

The Target REDcard is best for people who shop primarily at Target. If you don’t, there are a handful of comparable options for you to choose from.

If you want to earn cash back on Amazon purchases, check out the Amazon Rewards Card. Amazon competes with big box stores like Target and Wal-Mart, offering many of the same products, sometimes at lower prices.

Better yet, the Amazon Rewards Card is not restricted to Amazon like the Target REDcard is to Target. You can use it at any store, but it offers increased rewards for shopping at Amazon. The Amazon Rewards Card also comes with cash back on purchases at Whole Foods, restaurants, drug stores and gas stations.

If you have Amazon Prime you’ll earn a higher tier of cash back on the card than a regular Amazon shopper:

  • 5% back at Amazon and Whole Foods
  • 2% back at restaurants, drug stores, and gas stations
  • 1% back everywhere else

Without Amazon Prime, you’ll earn a flat 3% cash back at Amazon and Whole Foods, with the other earning rates unchanged.

If you’re looking for an easy to use credit card that earns the same rewards no matter where you use it, the Citi Double Cash Card is the card for you.

The Citi Double Cash Card offers 2% cash back, 1% when you make a purchase and 1% when you pay off your balance. While this rate is far below the 5% discount offered by the Target REDcard, the cash back on the Citi Double Cash Card applies to purchases at any store, not just Target. The 2% offered by the Citi Double Cash is also one of the highest flat earning rates for all purchases on any card.

If your interest in the Target REDcard comes primarily from the hope of saving money on groceries, you might want to open the American Express Blue Cash Preferred card. This card charges a $95 annual fee but offers a whopping 6% cash back on grocery store purchases. You also get 3% back on gas and at specified department stores.

That earnings rate beats out the Target REDcard’s 5% discount, while letting you shop at your own choice of grocery store. And, like the Amazon Rewards Card, the American Express Blue Cash Preferred can be used anywhere, not just Target.

Bottom Line: Should You Apply for the Target REDcard?

The Target REDcard is best for people who do most of their shopping at Target. If you don’t mind adding another card to your wallet, there’s no reason not to get the card for the Target discount. If you want to limit the number of cards you have, or simply don’t shop at Target often, you should choose a different card.