Answer: They can all affect your credit score!
A couple months back I read an article over on Budgets are Sexy by J. Money, who shared an interesting fact about credit cards, college students and the power of freebies.
A study by truecredit found that 40% of those surveyed had signed up for a credit card just to get a T-shirt or similar freebie, and over half of those people left college with credit card debt.
Free is a pretty amazing motivator. In my younger days, I also signed up for a credit card just to get a free t-shirt, but I promptly canceled the card when I found out how high the interest rate was. And my credit score still got dinged for opening and closing this card.
The most saddening statistic to J. Money and to myself as well is that 1 in 4 students left college with more than $5,000 in credit card debt. Most graduates already have thousands of dollars in student loans; another $5k in high interest credit card debt is something nobody needs. If students are racking this debt up on plastic they signed up for because of a free T-shirt, the risk that the credit terms are bad goes even higher
ABC Family's Greek recently provided a perfect example of the risk associated with picking a credit card based on the freebies they are offering rather than terms rewards and service. One of the main characters, Ashley, signed up for a credit card last season with horrendous terms including the $2,000 balance being due in full at the end of the month. I'm glad amidst the partying and pranks, the writers illustrated the problems associated with uninhibited credit card use, and I can only hope the viewers also absorbed this information. The show even avoids the easy way out by having Ashley's scheme to win the money in one night fail, requiring her to get a job to pay off the balance.
Basically it comes down to whether or not you think your credit score is worth a T-shirt whose value hovers somewhere around $2.50. If you think paying more in interest for the foreseeable future and being turned down for auto loans is worth a t-shirt; then by all means go ahead...sign up today. I bet you look cool in that free T-shirt!
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