This guest article was provided by Odysseas Papadimitriou, the Founder of CardHub.com—a website that helps people get the best credit card deals.

Do you pay your credit card bill in full each and every month?  Maybe you do, maybe you don’t, but no matter what, you’re probably aware that it’s best for your financial health to do so.  Such credit card use exhibits consumer responsibility and can save you a ton in interest.  Again, you probably know all this.  What you might not be aware of is the importance of credit utilization in the minds of the credit scoring powers that be or the fact that paying your bill in full might not be enough to garner a high credit score, particularly if you use a No Preset Spending Limit (NPSL) credit card or charge card.

You most likely aren’t even sure exactly what credit utilization is.  Credit utilization is a ratio of the credit you use as compared to the credit available to you.  Credit utilization ratios are calculated individually for each of your credit cards as well as for all of them collectively and included in your FICO score, the most widely-used credit score.  It’s therefore important to limit your monthly spending to around 40% of your available credit, unless your credit line is relatively small.  For example, there’s not much of a difference between spending $80 and $180 when your credit limit is $200, but there’s a significant difference between spending $4,000 and $9,000 when your limit is $10,000.

But what happens if your credit card doesn’t have a credit limit, or at least you think it doesn’t?  What happens when your credit card company won’t tell you your credit limit?  How can you maintain low credit utilization then?  Better yet, how can credit scoring agencies even calculate credit utilization without credit limits?

Therein lies the problem with No Preset Spending Limit credit cards and charge cards.  Whether you think these cards don’t have spending limits—as many people do—or you know that their limits are simply determined on a month-to-month basis and not conveyed to consumers or the major credit bureaus, it’s obvious that they throw a wrench into the credit scoring process.  However, the way in which they do so is perhaps worse than you might imagine.  According to our NPSL Card Study, issuers either don’t report limits to the credit bureaus for their NPSL cards or they report various arbitrary proxy limits.

At this point you might be asking yourself, ‘Since NPSL cards do have actual spending limits, why don’t issuers just report them?’  Great question.  Ostensibly, the reason issuers don’t report NPSL cards’ actual limits is because they are variable, changing based on your spending and payment history as well as trends in the economy.  However, the main reason issuers are so secretive about NPSL card limits is that they want to propagate the myth that NPSL cards have no limits.  It’s what makes them money; it’s what helped Visa Signature credit cards, World MasterCard credit cards, and the charge cards from American Express and Chase become some of the most popular financial products for people with excellent credit.

Unfortunately, when credit limit information is conveyed misleadingly to the credit bureaus, it can lead to misleading credit utilization ratios, which in turn might lead to a misleading credit score.  To further complicate matter, the extent of any potential credit damage is often difficult to predict because it depends on both the breadth of your credit history and the exact way issuers report their NPSL cards’ limits, which varies.

NPSL cards therefore make it difficult to maximize your credit score and might actually end up causing damage.  Given that they don’t bring any unique benefits, their use should be avoided.  Luckily there are a plethora of excellent options, like rewards credit cards, that can serve as replacements.  So compare all of the non-NPSL choices available to you and get a credit card for excellent credit that will allow you to maintain low credit utilization and a high credit score.

... but wait, we're not a bank!  I demand a new category to be created: Best Disruptive/Paradigm Shifting Web Concept. Yes?

On Monday night, Lending Club was awarded the top web honors in the Banking / Bill Paying category at the 15th Annual Webby Awards in New York City. Other nominees in this category were JPMorgan Chase, US Bank, Kashoo and Billeo.

The Webby Awards, hailed as the "Internet's highest honor" by The New York Times, are given annually to the best of the web in a variety of categories. Over 10,000 entries were received from 60 countries to gain recognition for websites, interactive advertising & media, online film and video, and mobile & apps. This is the second time Lending Club has been awarded a Webby, originally receiving the award in 2008. This year Lending Club joins big-name winners including Groupon, Mint, Zillow, Pandora, National Geographic, Angry Birds and Dropbox and celebrity sites from Conan O’Brien, Zach Galifianakis and Snoop Dogg.

The best moments of the ceremony award were when Antoine Dodson joined the Gregory Brothers to perform their viral hit live and when Peter Vesterbacka of Angry Birds accepted The Webby Award for Best Mobile Games - Handheld.

As customary, we were asked to deliver a 5-word acceptance speech when receiving the award.  Check it out:

CONTEST: Tell us your alternative 5-word Webby acceptance speech for Lending Club and WIN!

Oh, and to celebrate our win, we will be giving away 5 stainless steel laser-engraved Zippo money clips to the most creative alternative 5-word speech.  Think: "if I had to receive the webby award for Lending Club, what would my 5 words have been?".  Drop us a comment on our Facebook page to participate. Winners to be announced on Friday June 17 around 4pm on our Facebook page.

Jessica Ward is a full-time freelance writer and adoptive mom to two wonderful children. She writes to support her parenting/adopting habit. For more information see www.jessicaward.me or for frugal family tips see www.thepennywisefamily.com or @jessc098 on Twitter.

Many parents know the feeling—your school may not be meeting your child’s educational needs, or you do not feel they are safe there, but you don’t have the resources for a private school  either. What options are available to parents?

We’ve faced this in our household, our youngest, adopted from east Africa arrived with a language delay but a high IQ—she might not reach her full potential entering Kindergarten this year. Our oldest, also very high IQ, has learning disabilities that interfere with her classroom functioning, but she isn’t low-functioning enough to qualify for special services. In sixth grade, she risks missing out on critical life-skills (organization, time management) that may affect her success for a long time.

My family is a resourceful bunch and mired in education. My in-laws both work for school districts (a teacher and an administrator) my mother is a school psychologist, and I was home-schooled until the ninth grade. (And I like to think I turned out all right.)

There are still options for parents who have concerns that their neighborhood public school just isn’t hitting the mark.

Private schools. Yes, I know, not in the budget. Many schools still offer scholarships for children. Do some research and contact schools that might work.

Change public schools. Some districts may allow you to waiver your child out of a district and into a district with programs that better fit your child’s needs.

Charter schools, or alternative learning environments. Washington State (where I live) doesn’t allow for charter schools, but our district does have an alternative school available for grades 3-12, and two districts offer online school, which is ultimately what we choose—we waivered our kids out of our home school district and into a public online school.

Home schooling. This can be done with or without a curriculum program.  Home-educators can order “school” from a provider, or attend co-operative groups to share teaching and grading duties with other families, or design their own program to meet their state’s educational requirements.

Un-schooling. Un-schooling is perhaps the earliest form of schooling, encouraging children to learn from their natural environment. It’s gaining popularity as a learning program and works for many kids with attention or behavior challenges.

Supplementing. Keep the public school, but add on programs from the local library, church, synagogue, 4-H, scouting or other organizations.

Don’t be limited—you can mix the strategies above to meet your child’s individual needs. Private and alternative school programs aren’t all full of preps or thugs, many cater to children who are kinesthetic learners or who need more workforce-oriented learning opportunities instead of the classic “reading, writing and arithmetic.”

It is possible to meet your child’s young educational needs without sacrificing their future college fund.

On that subject…
It isn’t too early to be shopping for scholarships and academic programs to give your child a financial kick-start into college. While many scholarships aimed at children under age 13 aren’t published (for privacy reasons), there are some directories available. My daughters and I plan for these scholarships each year and make a list of which ones to apply for. This list caters to elementary and middle school students. http://www.finaid.org/scholarships/age13.phtml

Also, many programs exist for children to begin college early. Here in Washington we have a program called “Running Start” which allows high school juniors and seniors to attend community college classes along with, or instead of their high school classes at no charge.  I benefited from two years of free tuition this way, and a direct-acceptance agreement to any state university after I completed my Associates’ Degree.

Bottom  line: Don’t give up! A little planning and frugality now can give your child the education he or she deserves and will give you the peace of mind that you need as a parent.

There are 564 personal loans available to invest in on the Lending Club platform as of this Monday, June 13 at 12:30pm.  Great time to mobilize that cash sitting idle in your account.  Browse Notes >>

@RobGarciaSJ

This is one of the most frequently asked questions from those thinking of borrowing or investing via Lending Club.

Yes, it can be confusing.  Every state has its own laws about investments and securities as well as lending rules and regulations.  Here is an up-to-date view of states in which residents can obtain personal loans, invest or trade, via Lending Club as of today:

Investing

To invest in Lending Club Prime Consumer Notes, you must reside in one of the following 28 states and meet that state’s financial suitability conditions: California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Kentucky, Louisiana, Maine, Minnesota, Missouri, Mississippi, Montana, New Hampshire, Nevada, New York, Rhode Island, South Carolina, South Dakota, Utah, Virginia, Washington, Wisconsin, West Virginia, and Wyoming.

If your state is not listed above, you may be able to trade notes via FOLIOfn's Note trading platform.  At this moment, applicants from District of Columbia, Kansas, Maryland, Ohio, Oregon, and Vermont are not eligible to become trading members with FOLIOfn.

Notes offered by prospectus filed with the SEC.

Borrowing

All personal loans made through Lending Club are issued by WebBank, a Utah-chartered Industrial Bank.  We accept loan applications from US citizens or permanent residents of at least 18 years old with a valid bank account, a valid social security number and a FICO score of at least 660.  At this time, we are not accepting loan applications from the following 8 States: Iowa, Idaho, Indiana, Maine, Mississippi, North Dakota, Nebraska, and Tennessee.  For more details on borrower requirements, visit our help section on borrowing.

For the latest updates:

@RobGarciaSJ