About Commence MasterCard
It’s not often that we come across a credit card that’s truly unique, but that’s exactly what we thought when we saw the Commence MasterCard by Sallie Mae.
You see, the card offers you cash back rewards like many credit cards do, but what makes this card different is that you can redeem your cash back to pay off student loans. Not only that, but Barclays, the company who issues the card, will give you an added bonus if you put your cash rewards toward your loans.
While we’d like to say that everything is straightforward when it comes to this card’s rewards program, that isn’t the case. You have to become an expert in the fine print to know exactly what you’re getting.
If the thought of wading through paragraph upon paragraph of the Commence MasterCard’s terms and conditions doesn’t exactly thrill you, don’t worry. We love that stuff, which is why we love writing reviews of credit cards.
We’ve done the research and checked out the fine print so that we can create a review that will make things simple for you.
To do that, we’ve split this review into four different sections:
- Rates and fees
- Expert and consumer opinions
We follow this format because we think it hits all the major areas that will affect your life. Rewards are what make the card an attractive option and benefits are what make it reliable.
The rates and fees are what can ruin your cardmember experience, while expert and consumer reviews give you an idea of what other people are saying about the card.
The Commence MasterCard’s Rewards
Earlier we mentioned that the Commence MasterCard is a cash rewards card. What that means is that, every time you make a purchase, Barclays will give you a little bit of cash based on what you buy.
Here’s how this particular card’s rewards are structured:
- 2% on utilities and groceries
- 1% on everything else
There isn’t a limit on how much you can earn from your rewards. In theory, you could spend $20,000 a year on groceries and another $5,000 on utilities and earn $500 a year on your bonuses alone.
The reason why unlimited rewards are so great is that most cards put a cap on what you can earn in the categories that give more than 1% back on certain purchases. For example, the Chase Freedom will give you 5% back on different types of purchases every quarter, but there’s a $1,500 cap on those purchases.
If you want to know roughly about how much the card’s 2%/1% rewards rates can benefit you, the easiest way to do that is just to calculate how much you’ve spent over the past three months and how much of that spending can go on a credit card.
But, if you’re like the average American, then there’s a good chance you’ll spend $25,000 a year on your Commence MasterCard, according to the Bureau of Labor Statistics’ numbers.
Based on those numbers, we know the average household will spend about $4,000 on groceries. Utility bills fluctuate a lot based on where you live and how much a kilowatt of electricity costs, so we can offer a hard number. But, we’ll say that the average home spends about $150 a month on utilities, which is $1,800 a year.
The grand total of average spending on groceries and utilities is $5,800, or $116 a year. The non-bonus spending is $19,200, which is $192, leaving your rewards balance at the end of the year at around $310.
Redeeming Your Cash Rewards: Student Loans, Direct Deposit and Statement Credit
You have three ways of redeeming the cash back rewards you earn on the Commence MasterCard.
What’s unique about the student loan redemption offer is that Barclays will give you a 25% bonus on whatever you put towards your loans. So, if you use all $310 of the rewards balance we mentioned in the previous section to put toward your student loans, then you’ll get an extra $77.50 paid toward your loans ($387.50 total).
There are some things to keep in mind, though, per the Commence MasterCard’s terms and conditions:
- Minimum redemption amount is $10
- Payment processes within 5 to 7 days
- You can’t put your rewards toward your monthly payment
These are pretty straightforward. The only confusing part might be that third point. Just think of your rewards payments as extra payments in addition to your monthly payment.
The other two options, direct deposit and statement credits, follow the same $10 rule you have with student loan redemptions.
While there is no cap on how much cash back you can earn, the fine print does say you’re limited to $500 in direct-deposit rewards redemptions per day.
Direct deposits will be processed in three to four business days, while statement credits will take one to two days to go through.
Pro tip: Your cash rewards will expire if you don’t’ use your Commence MasterCard for six consecutive months.
When you make your first purchase on your card, Barclays will add $50 to your rewards balance. All you have to do is make the purchase within the 90 days following the day you were approved for the card.
0% on Balance Transfers for 15 Months
The final “reward” this card offers is no interest on any balance transfers you make in the first 45 days of having a Commence MasterCard account.
These types of promotions can save you a lot of money if you have a credit card with a high balance resulting in expensive monthly interest payments.
While you’ll be charged a fee to transfer that balance to your Commence MasterCard (more on that later), our research shows the fee is worth it if you have any kind of a balance that you don’t anticipate paying off in the next 15 months.
The Commence MasterCard’s Benefits
The benefits you get with this card are pretty thin. Commence cardholders have zero fraud liability, a common benefit of most credit cards. “Zero liability” means that Barclays won’t hold you responsible for any fraudulent charges made to your account.
Aside from that, you’ll also have free access to your FICO score, a perk that you’ll see with multiple banks like Discover and Bank of America.
The Commence MasterCard’s Rates and Fees
One of the things that we always like to mention is that rewards cards can be totally useless if you keep getting hit with fees and interest payments. However, those fees and payments are totally avoidable if you can pay your entire balance off every month.
Here is a list of the card’s rates and fees:
- Purchase and balance transfer APR: 14.99%, 21.99% or 23.99%, depending on your credit score
- Cash advance APR: 26.24%
- Balance transfer fee: 3% or $5, whichever is greater
- Cash advance fee: 5% or $10, whichever is greater
- Foreign transaction fee: 3%
- Annual fee: None
- Late/returned payment fee: $37
Just to give you an idea of how paying interest can undercut your card’s rewards, here’s an example. You carry a $3,000 balance every month and your interest rate is 21.99%. At the end of one year, you’ll have paid roughly $659 in interest.
That one year of interest payments cancels out just about two years of rewards, based on the numbers we crunched earlier.
The lesson here is very simple: Pay your balance off every month.
Expert and Consumer Reviews of the Commence MasterCard
Many of the reviews we read took a negative spin on the Sallie Mae card, but, at least in one instance, that had a lot to do with the card’s previous cash back structure, which was more lucrative than the current one.
Consumer reviews of the card were hard to find, but the ones we did discover pointed out something to. Some utilities will charge you a fee for paying your bill with a credit card. Keep that in mind when you weigh the cost vs. reward of the Commence MasterCard.
Pros of the Commence MasterCard
The obvious benefit to this card is the fact that you can apply your cash rewards to your student loans and, when you do, you’ll get a 25% bonus. Another plus is that your cash rewards aren’t capped.
Cons of the Commence MasterCard
The downside to this card is that the cash back rates aren’t that great. Consider this: The Citi Double Cash has a flat 2% rewards rate; you can earn you $500 a year when you spend $25,000.
That cash back amount is greater than what you’d get when you use your Commence MasterCard. So, the logic would go, why not just use a card like the Citi Double Cash, get your cash back in check form then use that cash to make an extra payment every month on your student loans?
Who the Commence MasterCard Is Good For
We believe the person who is best suited for this card is someone who spends a lot of money every month on utilities and groceries and wants an automatic way to make extra payments toward their student loans.
Now, if you feel like you have the discipline to make extra payments on your student loans without using the payment method the Commence MasterCard offers, we suggest trying a cash-back card with better rewards rates.
As we mentioned earlier, the Citi Double Cash can bring you $500 in rewards a year if you spend $25,000. Our advice? Apply that $500 to your credit card statement, then use that saved money to make an extra payment on your student loans.
Using this method can total $5,000 in additional payments after 10 years.
Choosing the right cash rewards card is tough, though, because there are so many choices. Our guide to the best cash back rewards cards of 2017 will help you make that decision by analyzing some of the top cards in a way that helps you see each card’s strength and weaknesses compared to the competition.