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How To Choose A Credit Card – 2021 Guide



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A credit card is a payment card that allows you to pay for goods and services at the expense of a bank. The client can use the money provided by the bank at any time and in any place. The borrowed amount must be repaid within the prescribed period. This is the same as if you borrowed a certain amount from a neighbor, but without unnecessary questions and incredulous looks.

Do not confuse a credit card with a debit card. Debit allows you to store and use only your own funds, receive social benefits, salaries. Both cards come in different payment systems, personal and non-personal, equipped with a magnetic stripe or chip, and with support for contactless technology (paypass). If in the case of debit cards everything is very clear, then credit cards have nuances that you should be aware of when registering.

A credit card is issued to the account. It must necessarily contain:

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– unique number of 16 characters;

– validity;

– surname and first name of the owner in Latin;

– technical means of payment – magnetic stripe, chip, PayPass / PayWave contactless payment carrier;

CVC code for online payments;

– the inscription “credit card” or the word “credit”;

– bank logo and its details (phone numbers, address);

– payment system emblem.

The card initially contains money – this is the difference from a debit card. The balance depends on the approved limit. You can pay with a card, or you can withdraw part of the funds if you need cash.

The main question is why do you need a credit card? For daily or emergency spending? Or maybe for some specific purpose – for example, on a trip abroad? A card with a grace period of 100 days can be a universal solution for any task. It can be used for everyday spending, and as a “spare wallet”, which you will resort to from time to time. This will allow you to safely refund money for unplanned purchases.

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For example, for the repair of home appliances or expensive tuition fees. If you constantly use the same store and would like to save on purchases, it is better to choose an offer with a lower limit and grace period, but with a cashback. For traveling abroad, a credit card that provides benefits to travelers is suitable.

It allows you to accumulate miles for free tickets, gives discounts on car rental and hotel reservations, and provides for extended insurance programs for those traveling abroad. The essence of a credit card is not in everyday use, but only in situations when it is really necessary.

«Many people do not follow this lending rule, because they consider the credit card to be a financial lifeline. Meanwhile, credit cards should only be used for purchases that cannot be paid on their own, without credit.» – says the director of InCharge Debt Solutions Karen Carlson.

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Make payments on time. This is the most important credit rule. Avoid delays in credit card payments. Your credit history depends on it. A good credit history guarantees the approval of a large loan if the need arises. Therefore, you should not neglect this rule.

Moreover, delays “hit and afford”. After all, banks charge fines for violation of payment terms. As a rule, on credit cards there is a period during which money can be returned without paying interest – the so-called “grace period”. Most often, this is 50 days, although some banks do not charge interest for longer ownership of their money – for 100 days.

If you manage to pay off the entire debt during the “grace period”, then no interest will be charged. If it is not possible to pay off the entire debt, then make at least a mandatory payment before the expiration of the “grace period”. This will help avoid penalties.

“If you are constantly having trouble paying off your debt on time, it’s better to ditch credit cards,” advises Karen Carlson, director of education at the nonprofit agency InCharge Debt Solutions.

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Check your credit card report. First, you may find any inaccuracies – banks are also not immune to mistakes. And secondly, checking the report will discipline you in terms of future expenses. It will be easier for you to understand where you could save money and what expenses were unnecessary. Checking your credit card report regularly is another opportunity to improve your credit story.

Do not drag yourself into a “debt hole” – plan your budget. Uncontrolled spending leads to an increase in interest payments. Treat credit card money like your own, not debt. If you are going to borrow money for a major purchase or vacation, then you need to save on something else. Then it will be easier for you to meet the “grace period” and do not have to pay interest.

Credit cards are not income, not personal money. We often forget about this, getting used to paying daily small everyday purchases with a credit card. This is fraught with exceeding the 30% credit threshold. Banks often offer to increase the credit limit, but this is not a solution to the problem. After all, a higher limit will “spur” you to spend even more available money. Therefore, weigh the pros and cons, and make sure you can handle debt repayment during the grace period.

Tips for choosing a credit card:

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  • Use only the amount you can repay.
  • People prone to impulsive purchases should not risk their wealth and get a credit card.
  • Try to get by with your available money so as not to “go into debt.”
  • Choose a card with the necessary and most interesting cashback.
  • Try to repay the loan before the end of the grace period. This will allow you not to overpay for using the card. To pay off debt, choose payment systems with a minimum commission percentage.
  • Do not delay payment. With a bad credit history, there is no chance of increasing the credit limit.
  • Use banking apps to track expenses. By controlling the movement of funds on the card, you can significantly improve your financial condition and reduce unnecessary expenses.
  • Do not apply for multiple cards if you are not sure of a stable financial position.

According to, a credit card should make life easier, not create problems. To choose the most profitable credit card option compare offers, carefully study sign-up bonus credit cards, read the terms and conditions because any banking product has advantages and pitfalls.

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Are Sallie Mae Student Loans Federal or Private?



When you hear the name Sallie Mae, you probably think of student loans. There’s a good reason for that; Sallie Mae has a long history, during which time it has provided both federal and private student loans.

However, as of 2014, all of Sallie Mae’s student loans are private, and its federal loans have been sold to another servicer. Here’s what to know if you have a Sallie Mae loan or are considering taking one out.

What is Sallie Mae?

Sallie Mae is a company that currently offers private student loans. But it has taken a few forms over the years.

In 1972, Congress first created the Student Loan Marketing Association (SLMA) as a private, for-profit corporation. Congress gave SLMA, commonly called “Sallie Mae,” the status of a government-sponsored enterprise (GSE) to support the company in its mission to provide stability and liquidity to the student loan market as a warehouse for student loans.

However, in 2004, the structure and purpose of the company began to change. SLMA dissolved in late December of that year, and the SLM Corporation, or “Sallie Mae,” was formed in its place as a fully private-sector company without GSE status.

In 2014, the company underwent another big adjustment when Sallie Mae split to form Navient and Sallie Mae. Navient is a federal student loan servicer that manages existing student loan accounts. Meanwhile, Sallie Mae continues to offer private student loans and other financial products to consumers. If you took out a student loan with Sallie Mae prior to 2014, there’s a chance that it was a federal student loan under the now-defunct Federal Family Education Loan Program (FFELP).

At present, Sallie Mae owns 1.4 percent of student loans in the United States. In addition to private student loans, the bank also offers credit cards, personal loans and savings accounts to its customers, many of whom are college students.

What is the difference between private and federal student loans?

When you’re seeking financing to pay for college, you’ll have a big choice to make: federal versus private student loans. Both types of loans offer some benefits and drawbacks.

Federal student loans are educational loans that come from the U.S. government. Under the William D. Ford Federal Direct Loan Program, there are four types of federal student loans available to qualified borrowers.

With federal student loans, you typically do not need a co-signer or even a credit check. The loans also come with numerous benefits, such as the ability to adjust your repayment plan based on your income. You may also be able to pause payments with a forbearance or deferment and perhaps even qualify for some level of student loan forgiveness.

On the negative side, most federal student loans feature borrowing limits, so you might need to find supplemental funding or scholarships if your educational costs exceed federal loan maximums.

Private student loans are educational loans you can access from private lenders, such as banks, credit unions and online lenders. On the plus side, private student loans often feature higher loan amounts than you can access through federal funding. And if you or your co-signer has excellent credit, you may be able to secure a competitive interest rate as well.

As for drawbacks, private student loans don’t offer the valuable benefits that federal student borrowers can enjoy. You may also face higher interest rates or have a harder time qualifying for financing if you have bad credit.

Are Sallie Mae loans better than federal student loans?

In general, federal loans are the best first choice for student borrowers. Federal student loans offer numerous benefits that private loans do not. You’ll generally want to complete the Free Application for Federal Student Aid (FAFSA) and review federal funding options before applying for any type of private student loan — Sallie Mae loans included.

However, private student loans, like those offered by Sallie Mae, do have their place. In some cases, federal student aid, grants, scholarships, work-study programs and savings might not be enough to cover educational expenses. In these situations, private student loans may provide you with another way to pay for college.

If you do need to take out private student loans, Sallie Mae is a lender worth considering. It offers loans for a variety of needs, including undergrad, MBA school, medical school, dental school and law school. Its loans also feature 100 percent coverage, so you can find funding for all of your certified school expenses.

With that said, it’s always best to compare a few lenders before committing. All lenders evaluate income and credit score differently, so it’s possible that another lender could give you lower interest rates or more favorable terms.

The bottom line

Sallie Mae may be a good choice if you’re in the market for private student loans and other financial products. Just be sure to do your research upfront, as you should before you take out any form of financing. Comparing multiple offers always gives you the best chance of saving money.

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Tips to do some fall cleaning on your finances



Wealth manager, Harry Abrahamsen, has five simple ways to stay on top of the big financial picture.

PORTLAND, Maine — Keeping track of our financial stability is something we can all do, whether we have IRAs or 401ks or just a checking account. Harry J. Abrahamsen is the Founder of Abrahamsen Financial Group. He works with clients to create and grow their own wealth. Abrahamsen shares five financial tips, starting with knowing what you have. 

1. Analyze Your Finances Quarterly or Biannually

You want to make sure that your long-term strategy is congruent with your short-term strategy. If the short-term is not working out, you may need to adjust what you are doing to make sure your outcome produces the desired results you are looking to accomplish. It is just like setting sail on a voyage across the Atlantic Ocean. You know where you want to go and plot your course, but there are many factors that need to be considered to actually get you across and across safely. Your finances behave the exact same way. Check your current situation and make sure you are taking into consideration all of the various wealth-eroding factors that can take you completely off course.

With interest rates very low, now might be a good time to consider refinancing student loans or mortgages, or consolidating credit card debt. However, do so only if you need to or if you can create a positive cash flow. To ensure that you are saving the most by doing so, you must look at current payments, excluding taxes and insurance costs. This way you can do an apples-to-apples comparison.

The most important things to look for when reviewing your credit report is accuracy. Make sure the reporting agencies are reporting things actuary. If it doesn’t appear to be reporting correct and accurate information, you should consult with a reputable credit repair company to help you fix the incorrect information.

4. Savings and Retirement Accounts

The most important thing to consider when reviewing your savings and retirement accounts is to make sure the strategies match your short-term and long-term investment objectives. All too often people end up making decisions one at a time, at different times in their lives, with different people, under different circumstances. Having a sound strategy in place will allow you to view your finances with a macro-economic lens vs a micro-economic view. Stay the course and adjust accordingly from a risk and tax standpoint.

RELATED: Financial lessons learned through the pandemic

A great tip for lowering utility bills or car insurance premiums: Simply ask! There may be things you are not aware of that could save you hundreds of dollars every month. You just need to call all of the companies that you do business with to find out about cost-cutting strategies. 

RELATED: Overcome your fear of finances

To learn more about Abrahamsen Financial, click here

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How to Get a Loan Even with Bad Credit



Sana pwedeng mabura ang bad credit history as quickly and easily as paying off your utility bills, ‘no? Unfortunately, it takes time. And bago mo pa maayos ang bad credit mo, more often than not, kailangan mo na namang mag-avail ng panibagong loan. 

Good thing you can still get a loan even with bad credit, kahit na medyo limited ang options. How do you get a loan if you have bad credit? Alamin sa short guide na ito. 

For more finance tips, visit Moneymax.



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