What You Need to Know Before Signing Up for a Store Credit Card

Experts warn there's more to the cards than just the rewards and discounts.

— -- The average American is expected to spend about $805 on gifts this holiday season according to the National Retail Federation, but experts are warning consumers early that some of the plastic in their wallets could be costing them in the long run.

"If you're someone who carries a balance, retail cards aren't for you," said Matt Schulz, senior analyst at CreditCards.com. "Even with the rewards and discounts, the math just doesn't work."

According to a new report released by Creditcards.com, the average store credit card carries a 23 percent interest rate -- compare that to a 15 percent rate, on average, for all credit cards.

Retailers with the highest interest rates include Staples, at 28 percent, and Zales Jewelers, at 29 percent.

Schulz said that getting 20 percent off at the store counter just to sign up for a new store card can seem like a good deal but not when the consumer faces a 25 percent interest rate.

If a consumer makes only the minimum payments on a $1,000 store credit card balance with a 23 percent interest rate, it will take the consumer 72 months to pay the balance off -- almost a year and a half longer than with a typical credit card -- as well as $838 in interest fees.

Financial experts say consumers should only sign up for retail store credit cards if they pay off their balance every month.