Retailers dangle discounts, but you’ll pay more to carry a balance. By Lisa Gerstner, Contributing Editor From Kiplinger's Personal Finance, November 2014 As you shop for holiday gifts, you may be tempted to open a store credit card and charge a big purchase -- especially if the cashier dangles a discount of, say, 20% for signing up. But don’t be dazzled by the discount if you’re likely to carry a balance. The average annual percentage rate on credit cards from the country’s largest retailers is 23.23%, according to a CreditCards.com survey. That’s about two percentage points higher than in 2010 and more than eight percentage points higher than the average APR for standard credit cards. If you charge $500 on a card with a 23.23% rate and make a $20 payment every month, it will take you nearly three years to pay it off. You’ll spend $190 in interest, outweighing any savings you’d capture by opening the card.SEE ALSO: 11 Credit Card Mistakes to Avoid Still, a store card could make sense if you pay off the balance each billing cycle (or before an introductory 0% APR offer ends, if you are lucky enough to snag one). The same survey found that retailers are juicing up rewards, with some providing tiered bonuses that become better as you spend more. For example, a Macy’s cardholder who spends up to $499 a year at the store receives three annual mailings of discount coupons; someone who spends $1,000 or more per year at Macy’s gets 12 mailings, plus other bonuses. Credit limits on store cards tend to be lower than for general-purpose cards, says John Ganotis, founder of CreditCardInsider.com. Try to keep your spending on a card at no more than 20% to 30% of its limit to maintain your credit score. And avoid applying for several cards while you’re on a shopping spree. A cluster of inquiries on your credit report as a result will send a negative signal to lenders and could damage your score.