Ikea card review: Here’s what you definitely need to know about the Ikea credit card application. Don’t apply without reading this...

Ikea store
When it comes to buying furniture, this Swedish mega-retailer has become the choice for many. How many people? Well let’s just say that the company’s founder – Ingvar Feodor Kamprad – is now estimated to be the 5th richest person in the entire world… with over $35 billion!

Update for 2013: The Ikea card was discontinued in 2011 and is no longer available to new applicants. I say good riddance to such a rotten offer!

For other ways to finance your new furniture purchase
compare 0% credit card offers and use one of them for your Ikea purchases.Here are some of my favorite...
Now even though the Ikea credit card is no longer available, there are still some accounts in existence (those who are still paying down their debt). For that reason, I'll keep the following review of the card up in case you need it for reference.

The Basics
The Ikea financing can be used at their stores (and their stores only) to purchase a karlstad sofa, frosta stool, salone vase, or whatever else your heart desires. It carries no annual fee and is accepted at all Ikea stores within the United States.

The Bait
What they’ve been offering for a while (and at the time of this review in 2011) their promotional offer… with the Ikea card they give “no interest if paid within 6 months on purchases over $299.” At first the above offer sounds okay, right? Who doesn’t want to save a little money on interest? Well saving money is always good, but unfortunately, it doesn’t look like this card is the best way to do so. Here’s why…

The Switch

Once you comb over the fine print, you discover the real deal behind this offer.
Retroactive Interest: Guess what happens if it takes you longer than 180 days to pay off that purchase in full? They slap you with interest retroactively… going all the way back to the date of purchase. So if it takes you 6 months and 1 week to pay it all off, you will be paying interest for that entire period on the full purchase.

Excessive APR: To make matters worse, the APR is extremely high to say the least. Some even go so far as to allege it's usury. At the time of this review, the standard purchase APR is a crazy 25.99%. Store charge cards are notorious for having high interest rates, but the Ikea credit card takes it to a whole other level. Suddenly, any bargain you get at Ikea will become a ripoff if you have to pay that kind of interest on it!

Lack of Benefits: So being that this credit card is definitely a bad way to finance your furniture purchase, you would think it would have some redeeming qualities, right? Well, it doesn’t appear to. For example, they list things like “View, manage and pay your account online” as a bullet point for their cardholder benefits. I don’t know about you, but that doesn’t sound like any special “benefit” to me!

Bad Customer Service: I spent a while looking up Ikea credit card reviews, comments, and complaints online. Surprisingly, I actually didn’t see a single positive opinion about the card. Reportedly, many card members have felt deceived by the back interest “bait-and-switch” and some have even alleged they were not told that by the sales associate that peddled them the card.
Conclusion
I see a lot of bad cards out there, but the Ikea credit card is one of the worst ones I’ve ever came across. Almost any credit card on the market gives you an APR lower than 25.99%, so just about anything is better than this one.

A Better Option

There are a number of major credit cards out there that give you 0% on purchases and balance transfers and you won't be hit with back interest if it takes you longer than the promo period to pay off your purchase. That would be the smarter way to go.

Note: If you are an old cardholder, I found that GE Money still keeps the account agreement terms and conditions online. You can view it here but please note it's a PDF and might load slowly!