New Sallie Mae credit cards: Are they worth it?

Most credit cards come from a handful of big banks, such as Citi, American Express, Chase, Bank of America, Capital One and Discover. But newer entrants have also been popping up in recent years, trying to break in, including Goldman Sachs and its Apple card as well as a few Silicon Valley startups.

In the summer of 2019, Sallie Mae joined the ranks as it launched three new credit cards aimed at college students and young adults. The cards were initially available only to Sallie Mae customers, but they are now available to the general public.

Whether you’re a young student considering your first credit card or a credit card buff, cards from nonmajor issuers are always exciting and interesting. Perhaps you’ve heard of the Sallie Mae credit cards and are wondering if they’re worth it. Read on to learn more about these cards to see if one suits your circumstances.

Sallie Mae credit card round up

Currently, Sallie Mae offers three credit cards – all charging no annual fee and earning cash back rewards. These cards are ideal for college students or young adults, who have just started pocketing some income from working a part-time job or a summer internship. If that sounds like you, check out how the three cards stack up in the table below.

Sallie Mae also touts other card features designed to appeal to younger people, including seamless integration with mobile apps that allow customers to manage their cards easily. Additional benefits include zero liability for unauthorized charges and cellphone protection (up to $600 per claim) if you pay your cellphone bill with the card.

It also seems that the Sallie Mae cards have no credit score requirement, so you can probably apply with little to no credit history.

When are Sallie Mae credit cards worth it?

When you’re applying for your first credit card

Clearly, these cards are designed to appeal to customers who are just beginning to establish their credit. The cash back rewards are fine but nothing special since top cash back cards with flat rates tend to offer around 2%. But since those cards might not be available to people with no credit record, these Sallie Mae cards might fill that void.

Of the three, the Sallie Mae Ignite Mastercard is the best pick for those completely new to credit cards. Not only does it come with a $50 sign-up bonus (not exactly generous, but it can’t hurt) if you spend $250 in three months, but also 0% intro APR on new purchases for six months.

Notice that the intro APR doesn’t extend to balance transfers – but those new to credit don’t have any debt from other cards to transfer anyway. This relatively short intro APR period is also ideal for bigger purchases students tend to make, such as a laptop, printer or Apple Pencil. It also gives young adults some leeway to learn about due dates, minimum payments and APR before charging them interest.

The Sallie Mae Ignite’s no annual fee and the low cash back of 1% are also ideal for first-timers. Why is a low cash back rate good for credit beginners? It doesn’t tempt you into overspending. To teach young cardholders about paying on time, Sallie Mae also rewards them with a 25% cash back bonus if they pay on time six months in a row.

When you have some credit card debt

Perhaps you already have a credit card, but you got caught up in the freedom and ease of swiping that plastic. And now you have a little bit of credit card debt. (It’s OK. It happens to the best of us.)

For people with some card debt, the 0% intro APR period on balance transfers for 15 months offered by both the Sallie Mae Accelerate and the Sallie Mae Evolve will serve you well. You have 60 days to transfer your balance from your other credit card, and Sallie Mae will charge you a balance transfer fee of $5 or 3% (whichever is greater). As for the intro period, 15 months is standard among other cards in the market. Unsure if your debt will be paid off in 15 months? If so, check out CreditCard.com’s balance transfer calculator to plan out your payment strategy.

When you have a student loan

Some of you may be funding your college education with student loans but also would like to build your credit score starting now. If so, consider the Sallie Mae Accelerate card. The card earns a flat 1.5% cash back on every purchase you make. However, if you redeem your rewards to pay off your student loan, the card will give you an added 33.33% on your cash back rewards rate. This essentially bumps up your cash back rate to 2% to go toward your student loan.

When are Sallie Mae credit cards not worth it?

When this is not your first credit card

If this is not your first rodeo, there’s no need for you to apply for one of these cards, especially for experienced cardholders who have a good credit score (670 and above). You’d do better with other cash back cards, getting great cash back rewards on your purchases while also widening your redemption options to include travel, gift cards and more.

Looking to build your credit while paying off existing debt? You should turn your shopping to the best balance transfer cards, some of which offer 0% intro APR for periods longer than 15 months and may earn you some serious rewards.

When you have travel plans

If your upcoming plans include letting loose over spring break, visiting home for the weekend or launching yourself overseas to study abroad, you probably want to pass on these cards. New cardholders who also want to fulfill their wanderlust will not find the Sallie Mae cards worth it. The Sallie Mae website does not specify if you can redeem your rewards for travel, and all three cards also charge a foreign transaction fee of 3%.  Anyone already planning their next trip would be better off looking at student cards geared for travel, such as the Bank of America Travel Rewards Card for Students*.

Should you get a Sallie Mae credit card?

The features of these cards make them appealing to potential customers who are just starting their financial lives. If that describes you, then these cards might be worth a look.

As usual, you should shop around online and see if there are other student credit cards that might fit your circumstances better. If you’re just starting out, don’t be too focused on rewards. The biggest priority is ensuring you use credit wisely, paying off your balance in full each month. If you mismanage your finances, late fees and interest can quickly eclipse any meager rewards you might earn.

Keep in mind that if you have a limited credit history, you might not qualify for the best rewards cards. So going with starter cards like Sallie Mae’s can be a sensible approach that allows you to build credit over time.

Bottom line

The Sallie Mae cards are solid choices for youngsters with no credit history and shopping for their first credit card. Anyone hoping for better rewards or various redemption options should look elsewhere. It’s important to note that the Sallie Mae website doesn’t touch on the redemption methods for your rewards, so be sure to thoroughly read your card’s terms and conditions to know what you’re signing up for.

*All information about the Bank of America Travel Rewards Card for Students has been collected independently by CreditCards.com and has not been reviewed or approved by the issuer.