About Sallie Mae World MasterCard
- No annual fee
- 5% cashback on gas and groceries up to $250 every month, after which rewards will be at 1%
- 5% cashback on books up to $750 every month, after which rewards will be at 1%
- Use reward points to pay an existing Sallie Mae student loan
“Student loans”: two of the scariest words in the English language, and while there are plenty of credit cards geared towards students, Sallie Mae’s World MasterCard specifically targets those with student loans to pay off.
The World Mastercard requires no annual fee, but this credit card does come with standard credit card ones, including fees for balance transfers, late payments and returned payments. The purchase APR rates are in the mid-range and there is an introductory APR rate of 0% for balance transfers, but that offer only lasts for 15 billing cycles.
The card rewards those who make standard gas and grocery purchases every month, and especially those who look to make regular book purchases. But the possible costs of maintaining this card are less attractive than the potential rewards.
Unless you’re a student with loans who’s still making substantial book purchases on stop of gas and grocery ones, you’re better off signing up for a card with a lower APR rate and lower fees.
Pros Cons No annual fee High late payment and returned payment fees Good rewards program
For a card whose primary selling point is an opportunity for students to pay off student loans, slapping an annual fee onto the card would be hard to stomach. Happily, the World MasterCard does not have an annual fee.
What the World MasterCard does have, however, are all the standard credit card fees most cards on the market have. These include a $35 late payment fee, up to $35 on returned payments, a balance transfer fee of either $10 or 4% (whichever is greater, based on the amount of each transfer), and a similar cash advance fee of $10 or 5% (again, whichever is greater). Foreign transactions cost 3% of the transaction in U.S. dollars.
These fees are built into a good number of credit cards, but because the Sallie Mae World Mastercard is geared primarily towards students with loans they have to pay off, the fees are somewhat hefty. The target customers might very well need the options to transfer balances and obtain cash advances, but those fees would discourage even the most financially thrifty student from actually using them.
The $35 late payment is on-par with regular cards, but can be punitive for students. It might promote financial responsibility, but if I were still a student, the late payment fee is not at all encouraging.
The APR for purchases is 13.99%, 20.99% or 22.99% depending on credit worthiness at the time of account opening. With these rates, it would be unwise for the cardholder to hold a balance, but again, there’s already a high possibility that the target consumer -- students with loans to pay off -- would have an accumulating month-to-month balance.
The Sallie Mae World MasterCard offers an introductory 0% APR on the first 15 billing cycles, after which the rates will become the regular APR. But beware: you may lose this introductory APR if you make a late payment.
In addition, the card offers 5% cashback on gas and grocery purchases on the first $250 spent per billing cycle, and then 1% thereafter. Similarly, a 5% cashback is offered on book purchases of up to $750 per cycle at eligible bookstores, after which the base reward amount will be 1%.
The Sallie Mae card’s biggest draw is that the cash back you earn from the card can be used as a statement credit, or a credit applied towards qualifying Sallie Mae student loans. It can also be redeemed as cash in a Upromise account. If used towards paying off a Sallie Mae loan, the reward can be used to reduce the total amount owed, but may not be used on the payments due.
The Sallie Mae World MasterCard is issued by Barclays Bank Delware and has a mobile app, where users can access account summaries, recent transactions and make payments.
In addition, World MasterCard benefits apply -- such as concierge service, price protection and MasterCard global service -- but there are restrictions, the details of which can be found in the card's terms and conditions.
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