Credits and what they mean

Published stories can be important to attracting a following and proving you can sell your work. Naturally, the more a magazine pays the harder it is (usually) to get a story published in. That means that your sale is considered a more significant accomplishment to a higher paying magazine. However, getting a story in a magazine that pays by exposure or contributor copies is better than no sale at all--and some of those can be classy and hard to get a story published in as well. It varies. But anything you can point to in your cover letter as an accomplishment in writing is better than having nothing to mention. But it really comes down to market research--as being unpublished can actually help you in some cases.

Robert E. Keller
http://www.scrollsofatlantis.com

Robert is right. If someone is paying to publish your story, it basically means they trust you it will make them money. Getting published by a paid publication is therefore usually considered a better credit.

However, that doesn't mean non-paying publications are no good. There are several well-known magazines that don't pay but are nevertheless well-respected in the biz. You just have to figure out which ones have a little clout.

(I personally take the approach of sending any work to paying magazines first unless I've written it for a specific publication. If it doesn't sell for money, I'll try non-paying magazines, because not selling isn't going to give you a credit anyway.)