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Select’s editorial team works independently to review financial products and write articles we think our readers will find useful. We may receive a commission when you click on links for products from our affiliate partners.

Scrolling through TikTok, you come across a huge range of videos, from people dancing to Doja Cat to someone encouraging you to invest in Tesla. Financial TikTok, also known as FinTok, is where individuals share advice on topics from investing to cryptocurrency to saving for retirement. 

Yet, just like a big chunk of the news you find on social media, there are lots of FinToks containing misinformation. Anyone can post on TikTok, so there’s no guarantee that you’re being provided with sound financial advice or that the person is qualified to talk about personal finance. Furthermore, while some of the financial advice found on TikTok may be accurate, it’s not one-size-fits all information that’s specific to an individual’s financial needs. 

Select fact-checked five popular personal finance TikToks, each with more than two million views, and spoke with two financial advisors to get their thoughts on whether the advice is accurate and worth following.

1) The Personal Finance Starter Pack: Age 18.

In this TikTok by Humphrey Yang, a former financial advisor with a popular personal finance TikTok and YouTube channel, Yang provides three personal finance suggestions for teenagers who just turned 18: open a checking account, build your credit score and open a Roth IRA

Is this good advice?

Yes, it’s good advice. Though our financial expert argues you don’t need to worry about your credit score when you’re 18.

First off, starting to save for retirement early is always better than later. Since most 18-year-olds don’t have full-time jobs or access to a 401(k) through their employer, a Roth IRA is a good way for teenagers to put money, that’s already been taxed, toward retirement.

With a Roth IRA, you won’t have to pay taxes on that money when you begin withdrawing it in your non-working years. And by starting young, you have more time to take advantage of compound interest.

Opening a checking account is another good idea for teenagers who’ve never had their own bank account and need an easily accessible place to keep their money. When choosing a checking account, you should look for one with no monthly maintenance fee, no minimum balance requirement and a low initial deposit. 

If you have more than a couple month’s worth of living expenses saved up in a checking account, you could also opt to save the excess in either a high-yield savings account, a CD or in the stock market. All of these options will yield a greater return on your money than a traditional checking account would. 

Yang also suggests that students who are looking to build their credit open a Discover it® Secured Credit Card. This secured credit card requires that people put down a deposit, which then becomes the credit limit. The deposit on the card becomes collateral if you ever can’t pay off your balance. 

Discover it® Secured Credit Card

On Discover’s secure site

  • Rewards

    Earn 2% cash back at Gas Stations and Restaurants on up to $1,000 in combined purchases each quarter. Plus, earn unlimited 1% cash back on all other purchases – automatically.

  • Welcome bonus

    Discover will match all the cash back you’ve earned at the end of your first year

  • Annual fee

  • Intro APR

  • Regular APR

  • Balance transfer fee

    3% intro balance transfer fee, up to 5% fee on future balance transfers (see terms)*

  • Foreign transaction fee

  • Credit needed

With the Discover it® Secured Credit Card, you also have the potential to upgrade to a traditional credit card after eight months if you make your payments on time and in full. This card is available to those new to building credit. 

However, John Madison, a CPA and personal finance counselor at Dayspring Financial Ministry, disagrees with Yang’s advice that teenagers should prioritize building their credit history.

“I don’t put a lot of emphasis — especially for young people — on building credit because I’ve seen instances where they’re kind of new to this personal finance thing, and it’s very easy to get out of control with spending.” says Madison.

Madison suggests one more piece of advice for teens looking to get started managing their finances: make a budget or a spending plan. When you start tracking your expenses and income early in life, it will help you create a good habit you’ll follow always. 

2) How to make $10,000 a month at 18 years old

In this TikTok by Thach Nguyen, realtor and TikToker with 1 million followers, Nguyen gives advice on how teenagers can make more than $100,000 by wholesaling rental property. He breaks it down into four easy steps: find a house that is run down, track down the owner of the property, make an offer on the property and put it under contract, then find an investor to sell the contract to for $10,000.

Is this good advice?

Theoretically, yes. But in reality, there are other obstacles when it comes to real estate wholesaling.

Wholesaling is akin to a finder’s fee for rental properties.

Madison breaks it down like this: You find a rundown property and make a lowball offer to the property owner and put it under contract. After that you find a professional real estate investor and offer them the option of taking your place on the contract. You never have to actually purchase the rental property and you’ll earn a fee from the real estate investor who takes over the deal.

Sounds easy, right? Not so fast though.

Real estate investing is often competitive, Madison says, so it might be difficult to find an investor. Furthermore, you typically have to put money down when you sign a contract to purchase a piece of property. If you’re unable to sell the property because you can’t find an investor, you could end up losing the deposit.

“I think [Nguyen’s TikTok] is a little too simplistic and appeals, in my opinion, more to people’s greed for easy money than it is really a viable plan,” Madison says.

3) How to retire before you are too old…

In this TikTok by Sam Primm, a real estate investor with more than 1 million followers on TikTok, Primm rejects conventional paths to retirement such as investing 10 to 25% of your annual income and waiting until you’re in your 60s to collect Social Security. He argues that people interested in retiring in the next five years should invest in real estate using “other people’s money” and create a passive income source that will cover their monthly expenses.

Is this good advice?

Again, it’s good advice in theory, but in practice, investing in real estate is a lot more complicated.

When Primm talks about the benefits of using “other people’s money” to invest in real estate, he’s talking about using leverage or borrowing money to fund a real estate investment. By putting a small percentage of the mortgage down on a real estate property, you’ll get a higher rate of return than if you paid for the property in cash. 

While Primm makes it sound simple to put a small amount of money down to buy a house, borrow the rest from the bank and then sit back and reap the rewards when the value of the house increases, it’s much easier said than done. 

“I’m not a big fan, in this context, of using debt, because you’re obligated as the owner of the property to continue to make payments to the mortgage company whether or not you’re collecting rent,” Madison says.

You’ll also have to find the right real estate market where the cost of renting property is greater relative to the cost of buying property as well as be aware of taxes that you could incur when selling property.

Furthermore, Scott Sturgeon, a wealth advisor at Falcon Wealth Advisors, notes that real estate investing isn’t really a passive income stream if you’re new to it and don’t yet have someone managing the day-to-day logistics.

“If your tenant calls you at 3 a.m. because the pipes are frozen, you have to be the one who gets up and goes over there,” Sturgeon says. “There’s obviously a lot of costs associated with upkeep of properties.”

While real estate investing has its benefits and is considered inflation resistant because landlords can increase the value of rent over time, for most people, it’s not a quick fix way to reach retirement early. 

4) How To Beat Evil Credit Cards!  

In a TikTok with nearly 18 million views, Mark Tilbury, personal finance YouTuber and self-proclaimed self-made millionaire, does a skit depicting an evil credit card issuer and a smart credit card user. Tilbury argues that credit card users are encouraged to spend a greater percentage of their credit limit and to pay back only the minimum amount on their credit card every month. 

Is this good advice?

Yes, it’s good advice for how to be smart when using your credit card.

Tilbury touches on two important aspects of responsible credit card usage: keeping your credit utilization ratio low and paying off your bill on time and in full to avoid high interest rates and late fees. 

“The average interest rate of credit cards right now is somewhere around 16% so that’s obviously very high compared to the interest rate you get on your checking account,” says Sturgeon. “So paying off that balance every month is much better.”

Another important factor in being a responsible credit card user is keeping your credit utilization ratio low. 

Your FICO credit score is determined by a variety of factors, and three of the most important are your payment history, your credit utilization ratio and the length of your credit history. Your credit utilization ratio is the ratio of credit you use to the amount of credit available to you. For example, if you’re using $100 of your $1,000 credit limit, your credit utilization ratio is 10%. 

If you want a good credit score, you should keep your credit utilization ratio low, around 10% to 15%, suggests Sturgeon.

5) Holding ftw

In a TikTok with nearly 4 million views, TikToker and YouTuber ecommjess breaks down the difference between long-term and short-term capital gains tax. 

According to ecommjess, the money that you earn when you sell a stock (aka capital gains) after holding it for less than a year is subject to your income tax rate. This is because your capital gains are considered a part of your income in the short term. For stocks held for more than a year, you’re subject to a long-term capital gains tax which is lower than the income tax rate.

Is this true?

Yes, it’s true that long-term capital gains tax is typically less than short-term capital gains tax. 

When it comes to investing in the stock market, you’re usually better off investing for the long haul.

Whenever you buy a stock and sell it for more than you initially bought it for, the money you earn is called capital gains. If you decide to buy a share of stock and sell it within a year of buying it, you’ll be taxed at rate in accordance with your income tax bracket, says Sturgeon. This is known as short-term capital gains tax. 

If you hold on to a stock for more than a year before selling it, you’ll be subject to a long-term capital gains tax which is typically lower than the short-term capital gains tax rate. 

“The tax code encourages longer-term investment,” Sturgeon says. “That capital gains structure, in theory, encourages investment which is good for building companies and in turn, allows people to generate income on their investments.”

If you’re a new investor, you should work on a long-term investing strategy in order to avoid short-term fluctuations, like the market downturn we saw in March 2020 because of the onset of the Covid-19 pandemic.

“I never recommend that somebody invest in stocks, unless they have at least a five-year timeframe, which is going to put it past the year required to get long-term capital gains treatment,” Madison says. 

Since most people have their money invested in retirement accounts and not taxable brokerage accounts, Madison also points out that it’s important for people to know that 401(k)s and Roth IRAs are not subject to capital gains tax. 

Bottom Line

Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.

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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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