Building Credit With Jewelry Credit Cards

By John Boitnott
Reviewed by: Lauren Bringle, AFC®
Published on: 09/22/2020

You’ve found that special someone, and now it’s time to show them how much you love them. The only problem is that the jewelry that best expresses those feelings usually doesn’t come cheap. There’s a big difference between the price tag and your disposable income. You have a job, but buying an appropriate engagement ring seems out of reach without purchasing the ring on credit.

Buying jewelry on credit—especially significant items such as engagement or wedding rings—can feel overwhelming.

Not only are there qualifications to meet before the lender or store will extend you credit, but you’ll also find a surprising number of options to choose from, all with different terms.

The key to success is finding the right fit for your particular situation, even when it means selecting a different store to make your credit jewelry purchase.

This guide will help you navigate the complex maze of buying jewelry on credit.

In this article

Options for buying jewelry on credit

You’re ready to take your relationship with your significant other to the next level. Congratulations!

Now you just have to figure out how to pay for it.

There are many options to choose from and it’s important to make an informed decision. If you want to pay for jewelry over time, here are your primary options.

1 - Jewelry store financing

Many jewelry stores offer their own financing. You take delivery of the item and enter into an agreement with the store to pay off the jewelry over time under specific terms.

Some stores even offer promotions, such as 0% financing for pricier items like engagement rings. Sometimes, the store employees may be incentivized to steer you towards this option.

The terms can sound very attractive, offering no-interest terms for a period of time, no payments for several months, or both.

The caveat with this type of payment option is the expiration date. Once the expiration date for the attractive incentive terms arrives, and assuming a balance remains on the account, you’ll face a new set of terms that are usually not so consumer-friendly.

Knowing the exact terms of promotional rates—and especially the terms that follow the expiration of those promotional rates—is crucial if you want to avoid unwanted surprises.

2 - Jewelry store credit card options

Jewelry store credit cards can present a challenging labyrinth of terms to navigate for consumers.

The basic terms are the same as financing: You’ll make monthly payments with interest (sometimes without) until the balance is paid off in full.

However, these stores often offer different terms—sometimes significantly different terms—and the card issuers may structure these accounts differently.

Let’s take a look at three examples from major retailers and their jewelry financing options.

Example 1: Jared

Jared offers its own Jared Gold Card with two distinct purchasing options based on the purchase amount and the length of the financing term.

The first option requires a $1,000 minimum purchase and a 20% down payment with the remaining balance financed over 12 months.

The second option requires a $5,000 minimum purchase and 20% down payment, with the balance financed over 18 months.[5] During the initial period, the financing is interest-free. After the initial period is over (12 or 18 months, depending on the plan), the interest rate on this financing option will increase to 9.9% for six months, and 24.99% after that.

That’s quite a big jump in interest if you don’t pay the purchase balance off during the promotional period.

Example 2: The Shane Company

Shane Company is the largest privately-owned jeweler in the United States. The company operates 20 retail stores across the country, and, like Jared, they have their own credit card. Below, we’ll be covering their different jewelry financing options.

Unlike Jared, Shane’s credit card is issued by Wells Fargo Bank. In contrast to credit cards issued by banks, Shane’s credit card carries no annual fee and offers multi-tiered financing options for consumers.

Financing Period Interest Rate
24 months 9.90%
36 months 10.99%
48 months 11.99%
60 months 12.99%

Once the initial period is over, the interest rate jumps to 28.99% on the remaining balance.

Cardholders may also benefit from other perks like:

  • Gift wrapping
  • Free shipping
  • Early holiday perks before they are available to non-card holders.

Example 3: Kay Jewelers

Kay Jewelers is owned by Sterling Jewelers, which in turn is owned by UK-based Signet Jewelers, Ltd. Incidentally, Signet also owns Zales and Jared and is the world’s largest retailer of diamond jewelry.

Kay offers two special financing options for customers:

  1. A simple 12-month financing plan with no interest if paid in full within those 12 months.
  2. Kay’s in-store credit card. Kay only requires a $500 minimum purchase to use its credit card, but the interest rate is between 17.99% to 24.99%, depending on the results of a credit check.

How jewelry store credit cards impact your credit score

When buying jewelry, customers often get so caught up in the emotional aspect of the experience they don’t look at the practical side of financing their jewelry purchase.

It’s crucial to understand exactly what impact this will have on your finances in both the short- and long-term.

Knowing how much money you’re agreeing to pay is one thing. Knowing how your financing choice will affect your credit score is another.

Credit utilization

If you don’t have any established credit history, opening a line of credit won’t really hurt your score if you pay the balance off quickly—say, within the promotional period.

However, if you don’t pay it off quickly, then your credit utilization ratio may rise over time.

Your credit utilization ratio counts for about 30% of your FICO score, so the lower this number, the better. If the debt is paid off in a timely fashion, that could have a positive impact on your score.

If you have established credit history, the impact on your score will be determined by how you handle the debt. Paying the debt in a timely fashion could affect your score positively.

Late payments and carrying a balance for extended periods will not reflect well.


You might think an effective strategy would be to open an account with a jewelry retailer, pay the balance off, and then cancel the card. This isn’t necessarily the ideal strategy because canceling a credit card can knock your score down a few points.

That’s especially true if you have outstanding balances on other lines of credit, according to Gage Diamonds. This strategy increases credit utilization and thus can lower your score. If your goal is to build credit, a better strategy might be to look into credit lines that you plan to stick with long-term.

One of the factors that affects credit utilization is credit limit. One way to reduce the impact of credit utilization on your score is to get a credit limit increased on another line of credit before you cancel the jewelry store card.

Hard inquiries

It’s not just the credit utilization ratio that can negatively impact your score.

Even one hard inquiry into your creditworthiness can knock your score down a few points.

If you have a well-established credit history with a good score, the effect of an inquiry might not be too steep.

However, if you are just starting out and don’t have an extensive credit history, the impact can be more significant. Inquiries stay on your credit record for two years and count against your credit score for one year.[9]

How do jewelry stores convince you to finance?

There are two major ways jewelry stores try to convince you to finance.

1 - Promotions

We’ve all gotten promotions in the mail and in our email inboxes.

Jewelers use multiple channels to increase our awareness of the promotions they offer. Print and digital are the two obvious ones, but radio is also a huge advertising medium for jewelers.

Their commercials often advertise districts where many jewelers set up shop so that customers can check out different options in one walkable area. Jeweler’s Row on Sansom Street in Philadelphia is famous for this, as is Manhattan’s Diamond District.

2 - In-store

Once the jeweler convinces you to come into the store, you’ll find the staff is only too happy to answer your questions about financing options.

The important things to remember here are to:

  1. Ask the right questions
  2. Read the agreement and disclosures carefully before you sign

Many jewelers pride themselves on being reputable, but keep in mind that these people are running a business, the overwhelming goal of which is to maximize profit.

Like all salespeople, they are trained in handling and overcoming objections to financing, as evidenced by this guide from the Jewelers of America on how to get customers to finance jewelry.

Asking the right questions, being an informed consumer, and being willing to walk away if you can’t come to a mutually beneficial agreement helps ensure you get financing that works for you, not against you.

A successful transaction means that both merchant and consumer get what they want.

What to ask before using a jewelry store credit card

Before anything else, you should ask yourself one crucial question:

How much money do I have?

Knowing how much money you can put down towards a piece of jewelry and how much you can afford to pay every month are the crucial data points that prevent you from getting in over your head.

Looking at your own finances realistically also helps prevent being late on payments once you enter into a financing arrangement.

Note: make sure your calculations take into account paying off the loan within its promotional period.

What are all the terms of the agreement?

This covers both the bold print (“0% FINANCING!!!!!”) and the fine print (*Minimum 20% down payment. Deferred interest applies.”).

Understanding all the terms will help you decide if this is something you even want in the first place.

There’s a reason why the fine print is so small.

One thing often hidden in the fine print of a credit agreement is deferred interest.

Deferred interest means that once the promotional period expires, interest has been accruing on the remaining balance since the inception of the loan, and now you must pay that, too. It’s the interest that runs in the background.

People generally learn about deferred interest in one of two situations:

  1. When you actually read your credit agreement before signing it
  2. When the amount owed on your loan jumps considerably after the promotional period expires

It’s best to learn about deferred interest before one of these situations develops. Jewelry retailer Blue Nile has a good example of the disclosure language to look for when deferred interest is part of the agreement:

“Interest will be charged to your account from the purchase date if the purchase balance is not paid in full within the 6, 12 or 18 months or if you make a late payment.”

What to avoid when buying jewelry on credit

While there are many different credit options that can work for individual situations, here is something to avoid outright, as this offers no benefit to the consumer.

“No credit check” financing

Stores extend offers of “no credit check” financing to lure in customers with bad or minimal credit.

It sounds attractive to many shoppers who are struggling with credit, because your FICO score and history (apparently) never enter into the equation, and you still get the jewelry you’re trying to buy.

Entering into this type of agreement is equivalent to leasing a car. You make payments for a three-month period and then you have the option to buy the ring at the original price.

What’s worse is they offer you the option to finance your lease payments over 12 months, which allows them to make money twice on a single purchase.

This is equivalent to paying 200% APR, which is considered “usurious interest”—illegal in most states, unless it’s carefully crafted to avoid triggering the application of those laws.

Stores that offer this option can’t legally refer to it as “financing” so they use other terms to describe it. For instance, some websites like Unclaimed Diamonds offer this approach as a “lease-to-own” program.

Options besides store credit

The good news is there are other options besides credit cards that can make your jewelry purchase a reality. Like credit cards, it’s important to look at these offers carefully before signing on the line.


It may not seem like the best option when you first consider it. However, the credit check from the Bank of Mom and Dad has absolutely zero impact on your credit score.

What’s more, the loan terms are often more favorable than any bank, and once they see what your wedding is going to cost, helping out with the engagement ring might seem like a drop in the bucket.

Regular credit cards

Do you have a VISA or MasterCard from a conventional bank that offers a standard interest rate and maybe even a 1% cash-back program for every purchase? Consider using that instead of low-promotion but ultimately high-interest store credit.

Over time, it may be a net win, depending on how long you carry the balance.

Conventional personal loans

A personal loan from a bank or other lending institution often offers lower interest rates than credit cards, even if you have less-than-stellar credit.

If your credit score is on the low side, you’re often locked out of conventional credit cards with higher limits, and the credit cards that you do qualify for are likely insufficient to finance a significant purchase such as an engagement ring.

The main benefit of a personal loan is predictability. You’ll have a fixed interest rate and a fixed payment term, which help simplify financial planning.

Shop online

Jewelry purchases do not have to be made in person at a store. Many online jewelry retailers can pass some of the savings of not having to maintain a storefront on to their customers.

However, it’s even more important here to go into the transaction knowing precisely what you want because you don’t have the benefit of the helpful salesperson who can answer questions regarding cut, color, and clarity. Cost, however, is laid out right in front of you.

One thing to remember is that you are purchasing something that can cost a thousand dollars or more. It should not be shipped using normal postal channels.

Check the online retailers shipping options and, if necessary, pony up the money for the tracking number and insurance on your jewelry. Also, do not allow it to be delivered to anyone but you. The added peace of mind and assurance that it will arrive at your door safely are worth the extra cost.

Don’t finance

It’s possible to obtain beautiful and meaningful jewelry without going into debt up to your eyeballs. Many proposals rely on a treasured family heirloom engagement ring and are a great way to get families more involved in the happy occasion.

Pawn shops also offer jewelry from estate sales or from people willing to sell their treasures.

Additionally, jewelers are getting more and more creative with non-traditional stones such as onyx and jade to make beautiful jewelry without the use—and cost—of traditional diamonds.

Make it rewarding

Remember our earlier suggestion of using a conventional credit card that offers a 1% cash-back reward? This is a great way to make credit work for you instead of feeling like you're chained to a debt.

Of course, you have to pay the loan back with interest if you’re financing over time, but reward points can take some of the sting out of it while allowing you to save money on a future purchase.

Below are some examples of attractive rewards and the cards that offer them.

Zero percent financing

Store credit cards aren’t the only option for interest-free financing. Many conventional cards offer this as well.

Some banks offer cards that allow interest-free financing on both new purchases and balance transfers too.

This means you could arrange financing on a store card, and then immediately transfer the balance to the card that offers zero percent interest as well as rewards.

With a good enough credit score, you could also qualify for a card with no annual fee.

Travel rewards

You’ve got the engagement ring locked, and now you’ll just have to wait an eternity before having the money saved up for a honeymoon, right? Well, no, not necessarily. There are credit cards that reward frequent users with travel points that can be used on air travel and hotels across the United States and internationally.

There is one caveat. If you’ve ever traveled for business and dealt with airline miles, you know that they come with sometimes significant restrictions. Travel rewards with credit cards are no exception. They can absolutely work to your benefit, but make sure you educate yourself about any applicable limitations on using those miles.

Cash back

Some cards choose to keep it simple and offer a percentage of your purchases back as cash. This is beneficial because the money can be used on whatever you wish.

The great thing about cash-back offers is that the terms are simple, clear, and easy to understand. They may be subject to an expiration date. For example, the points accumulated must be redeemed within a certain time or they’re lost. So, as always, be sure to read the fine print.

About the author

John Boitnott is a longtime digital media consultant and journalist who covers technology trends, startups, entrepreneurship and personal finance for Inc, Entrepreneur, Business Insider, USA Today and other major publications. See John on Linkedin and Twitter.

About the reviewer

Lauren Bringle is an Accredited Financial Counselor® with Self Financial– a financial technology company with a mission to help people build credit and savings. See Lauren on Linkedin and Twitter.

Editorial Policy

Our goal at Self is to provide readers with current and unbiased information on credit, financial health, and related topics. This content is based on research and other related articles from trusted sources. All content at Self is written by experienced contributors in the finance industry and reviewed by an accredited person(s).

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Written on September 22, 2020
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