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Microsoft Chairman Bill Gates shook the world (once again) when he called banks “dinosaurs” and that they could be bypassed. Did he say this recently? Nope. He said it over 25 years ago. Did his prediction come to pass?

To find out, let’s study the studies . Spoiler alert: the answer is not as black and white as you may assume. As fintech continues to be embraced by younger generations, traditional banks realize that they are stuck in quicksand.

Their lag in the use of digital has a major impact on customer loyalty (50 percent) and revenue growth (51 percent). Financial firms cite significant barriers, including an inability to experiment quickly (56 percent), legacy systems and processes (55 percent), and change management (41 percent).

This study reports that many financial services firms are actively embracing digital, but only a minority (20 percent) believe they are utilizing these technologies successfully. Only 15 percent believe that they are optimizing end-to-end customer experiences.

Only seven percent of bank credit products can be handled digitally from soup to nuts, according to a recent analysis by Bain and SAP. This does not sit well with most small-to-medium enterprises (SMEs) looking for financing.

In fact, 56 percent of SMEs want better digital banking tools, according to Javelin Research. Over 60 percent of small business owners prefer to apply for loans entirely online.

What we have here is a David vs. Goliath showdown.

The Fintech That Gets Noticed

The Fintech that usually gets the most attention (and the most investment money) are the ones that are specifically designed to be a threat to traditional banks.

The hope is that these startups can bring more flexible and faster service, and make traditional banking a more acceptable and even enjoyable experience emphasis on the word “experience.” It’s a word that Millennials swear by.

The term—and it’s a term we hear a lot —is disruption. A revolution like this opens up competition and turns heads toward the easiest, most dynamic, and most rewarding ways to bank.

The Fintech Capitals of the World

North America produces the most fintech startups (thank Silicon Valley), with Asia, particularly China, coming in at a close second. Singapore is another major player in Asia and on the global stage, thanks to tax benefits, government assistance and access to regional markets.

Bye Bye Banks?

Gartner, a global research and advisory firm, predicts that, within 12 years’ time, 80 percent of financial firms will either go out of business or be rendered irrelevant by new competition, customer behavior and advances in technology.

Instead, “heritage financial firms” will exist only formally but not competing in the traditional way. Gartner vice president David Furlonger says that traditional banks face a risk of failure if they continue to maintain 20th century business and operating models.

Don’t Write Off Banks Just Yet

Hold on, though. Let’s not bow our heads and hum a funeral dirge for banks prematurely. Since Bill Gates made that dinosaur prediction in July 1994, bank earnings have quadrupled and equity capital has quintupled, according to FDIC.gov.

Meanwhile, branch and employee growth has been small compared to revenue growth, which actually makes traditional banks tighter and leaner. Bank industry earnings in the first quarter of 2018 were at an all time high, totalling over $50 billion . Another huge advantage the traditional banks still have over fintech: lots of customers (for now).

Fintech As Disruptor

Still, it’s no time for traditional banks to coast on their historic reputation. For quite some time now, Fintech has been chipping away at the formerly sturdy foundation of traditional banks.

Mobile banking, artificial intelligence and other tech tools are leading the disruption parade. Investors are taking notice and putting their money where their mouth is: from 2011 to 2015 alone, investment in fintech has grown nearly eightfold .

Finnews.com reports that, in the first half of 2018, the global fintech industry attracted $58 billion in financing. It cites Germany’s Wirecard as now being worth more than Deutsche Bank.

The advantage for fintech: a system free of legacies that can offer their services at half the price of traditional banks, according to a study by Morgan Stanley.

The report concludes that banks will have to reinvent and disrupt themselves to keep up. In particular, traditional banks in Europe are vulnerable due to years of super-low interest rates.

Fintechs Vs. Traditional Banks Vs. The Generational Divide

Younger generations are going to lead the charge, as always. Research reveals that Gen Y is “frustrated with the outdated nature of financial systems;” Millennials are generally turned off by banks because they don’t offer “appealing products and services.”

A FICO survey of Millennials shows that the lack of a mobile banking app as the main barrier to engaging with a bank; Millennials are also three times more likely than other generations to manage their bank account through a mobile device.

Sixty-eight percent of Millennials say that in five years, the way we access our money will be totally different.

The Rise of Cryptocurrency

Even the way we handle money is going to evolve, making the very reasons for banks’ existence to be called into question. According to The Harvard Business Review, cryptocurrency like Bitcoin will not necessarily replace traditional currency (even the U.S. dollar is used as e-currency), but that doesn’t mean that new technologies like this won’t cause some serious disruption to traditional banking.

If you think about it, cryptocurrency is already sort of a regular thing: we use less physical cash less often. We’re already transferring digital code for goods and services. SoFi can help you get started buying and selling cryptocurrency via the SoFi Invest.

Cryptocurrencies go beyond just being digital currencies; many forms of crypto operate as self-contained systems that don’t depend on the oversight of a bank or central authority.

Although traditional banks provide similar services (electronic transfers and online payment, for instance), they are no match for a new system that can bypass a central bank authority and work with numerous currencies in real-time without drag or delay from approval or confirmation processes.

The Latest Fintech Trends

In addition to cryptocurrency, the top fintech trends recently reported by Forbes include:

•  Digital-only banks. Influenced by mobile banking, banks with no brick-and-mortar branches are increasing in popularity and acceptance, particularly popular among Millennials. Phone apps allow for money management while on the go. As a result, bank visits to branches are expected to drop in the future.

•  Artificial intelligence (AI). AI tech can automate data analysis, saving time, money and drudgery. It’s also used to create chatbots to assist in customer service and robo-advisors to help with investing. AI can also help detect fraud by monitoring patterns of customer behavior.

•  Biometric technologies. A system used to prevent cyber attacks, as well as helping to make logging in to an app easier and faster.

Fintech Rising In Developing Countries

In the third world, not everybody has access to a bank account or a traditional banking system. As an alternative option example, East Africa , mobile phone companies allow customers to transfer cash-convertible phone credits to each other.

These phone credits act as a digital medium of exchange — the payment structure and its support fintech is the mobile phone network itself.

Traditional Banks Are Seeing The Future and Feeling The Pain

Traditional financial services are paying close attention; they’re seeing the changes approach closer. A 2018 executive survey found that nearly 80 percent of higher-ups feared that their firms were at risk of disruption and displacement from fintech. Three quarters of those respondents represented some of the largest financial services in the business.

Consumers, especially younger ones, are expecting more technology and personalization when it comes to their financial services. A growing group of entrepreneurs and startups are answering the call.

How Traditional Banks Are Responding

Of course, traditional banks got with the program at least on a basic level. They know to offer mobile apps, electronic bill payment and online services. They’re also experimenting with fintech such as voice adaption to pay bills and to make transfers. The challenge remains in keeping these programs safe, fresh, and user friendly.

At least for now, banks retain the advantage of recognizable brands and large customer bases, particularly older clients who have grown up doing business with human tellers in brick-and-mortar locations.

What they still haven’t completely mastered are faster transaction times, lower costs and a better customer experience.

They also have to go a long way to earn back trust thanks to the hangover of the financial crisis of a decade ago, which even younger people still remember.

The Great Recession has left many people of all generations with a distrust of traditional banks, which occurred at the same time when more people were becoming tech savvy and connected.

The Need for The Best of Both Fintech and Traditional Banks

The comparison may be apples and oranges, but the solution may be more of a mix of old and new. The University of Pennsylvania’s Knowledge blog considers a blend of physical and virtual touchpoints:

“People want to know that banks are nearby and part of the community. Defunct online banks such as Wingspan and ING Direct, now Capital One 360, didn’t scale without the brick-and-mortar element, much like Amazon, the e-commerce giant, now sees the need for physical presence with the roll-out of lockers, pick-up points, and even Amazon Go stores.”

Traditional Banks Are Keeping More of Your Money

While traditional banks continue to attempt to adjust to the digital age, they’re certainly not giving us a break for our patience in the meantime. We thought we had a deal with traditional banks: they were supposed to pay us (interest) for the privilege of letting them use our money.

Have you seen most banks’ interest rate offerings lately? It may be better to keep your money under your mattress. The average checking account interest rate is 0.06% while average savings account rate is .09%.

SoFi Checking and Savings

SoFi Checking and Savings® is a mobile-first checking and savings account where you can spend and save in one place. Plus, there are no account fees (subject to change). Use any ATM that accepts Mastercard® and SoFi will reimburse you for any ATM charges (subject to change).

Ready to come into the digital age? Open a SoFi Checking and Savings account today!

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External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2022 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
SoFi Money® is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member
FINRA / SIPC . SoFi Securities LLC is an affiliate of SoFi Bank, N.A. SoFi Money Debit Card issued by The Bancorp Bank.
SoFi has partnered with Allpoint to provide consumers with ATM access at any of the 55,000+ ATMs within the Allpoint network. Consumers will not be charged a fee when using an in-network ATM, however, third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.
SoFi members with direct deposit activity can earn 4.50% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a deposit to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate.

SoFi members with Qualifying Deposits can earn 4.50% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant.

SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.50% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.

Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.

Interest rates are variable and subject to change at any time. These rates are current as of 8/9/2023. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet..

Crypto: Bitcoin and other cryptocurrencies aren’t endorsed or guaranteed by any government, are volatile, and involve a high degree of risk. Consumer protection and securities laws don’t regulate cryptocurrencies to the same degree as traditional brokerage and investment products. Research and knowledge are essential prerequisites before engaging with any cryptocurrency. US regulators, including FINRA , the SEC , and the CFPB , have issued public advisories concerning digital asset risk. Cryptocurrency purchases should not be made with funds drawn from financial products including student loans, personal loans, mortgage refinancing, savings, retirement funds or traditional investments. Limitations apply to trading certain crypto assets and may not be available to residents of all states.

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Paying off your student loans can feel like a grueling journey, especially if you have a lot of it. And there’s a lot of student loan debt out there—$1.5 trillion to be exact .

It’s becoming clear just how much student debt can have a negative impact on the psyche of the student debt holder. In a survey conducted by SoFi, 83% of respondents felt like they couldn’t relax due to their student loans, and 50% felt that student loan debt has made them feel depressed.

More than a third have reported losing sleep due to student loan debt, and plenty of others say that it’s caused them to miss out on opportunities to travel, practice self-care, and make major life decisions.

If you’re in the throes of student loan debt repayment, you should know that there’s hope: Catie Gould and Veronica Scafe, two SoFi members, show us that it can be done. Not only did they each pay off their nearly $100,000 in respective students loans, but did so in about four years—significantly faster than their original loan terms.

It is important to note that these results may not be typical of every person paying down student loans. Below, these two members share their student debt journeys as well as their tips to help pay off student loans.

Meet Catie Gould and Veronica Scafe, SoFi Members

If you’ve got student loans and are looking for inspiration to get rid of them once and for all, Catie Gould and Veronica Scafe are your people. Both paid down nearly $100,000 in student loan debt.

Catie Gould paid off her student loans in just over four years—an impressive feat considering she graduated with around $91,000 in student debt from her dual degrees in material science and mechanical engineering.

Veronica Scafe found herself in a similar situation after graduating with $99,800 in student loans from obtaining her Doctor of Pharmacy degree. Even though Scafe had only expected to leave graduate school with $80,000 in loans, she was able to pay off the balance in an incredible three years and eleven months.

Their Personal Strategies For Paying Off Student Loans

Right out of school, Gould and Scafe deployed similar strategies for paying off their student loans fast; they both worked hard at keeping their expenses low, even with their new, higher salaries.

When Gould graduated from school, she avoided “lifestyle inflation” even though she was making more money than she ever had before. “Not very much changed for me after graduating. I am a saver by nature. I kept driving my old car, living with roommates, shopping at thrift stores, taking local vacations.”

And Gould didn’t stop there. “I bought a bicycle to get around town, tried gardening, and cooked my own food most of the time. I said no to plenty of things, but most never felt like a sacrifice.”

It helped Gould that she didn’t have expensive tastes to begin with: “Festivals were a big thing I never knew about. I was shocked that people pay $300+ to go to weekend music festivals.”

Scafe recounts an experience similar to Gould’s. She and her husband “never expanded our lifestyle to fit our salary so we never had to make cuts.” Scafe added, “We live pretty frugally. We have a modest home. We cooked most of our meals at home and took leftovers for lunch the next day.”

Just as keeping expenses low was an important tactic for both women, so was making additional payments towards their student loans. Neither wanted the emotional burden of paying back loans for longer than they had to, nor did they like seeing so much of their loan payments go towards interest payments and not the principal.

Simply having a long, hard look at how much you’re spending in interest payments every day, week, or month, may be the motivation you need to pay your loans off faster than the standard ten-year repayment schedule.

“I sometimes calculated how much interest I owed every morning just for waking up,” says Gould. From this exercise, she noticed that the daily interest charges on her student loans cost her “more than eating out every day, which I considered pretty indulgent,” and this motivated her to take action, and fast.

Gould and Scafe also refinanced their student loans, which provided them both the extra boost they needed to pay their loans back on such short timelines. By refinancing and qualifying for lower rates, more of each payment could be applied to the loan’s principal and not just interest.

What pushed them to pull the trigger on refinancing?

When Gould started her first corporate engineering job, the company was in the midst of layoffs. Luckily, she kept her job, but she says that “the layoff had a huge impact on me.” This experience at work pushed her to explore even more options for lowering her student loan bill.

The concern of how she’d make payments if something were to happen to her job, along with interest rates that she felt were far too high—some of them at 8.75%—inspired her to tackle her debt through extra payments and refinancing.

Gould refinanced around $36,000 of her debt through SoFi. She said, “Getting out of a higher interest rate was really helpful to pay down my remaining student loan balance. I feel a lot more in control of my future and how I chose to spend my time. It’s steered my life in a direction I never anticipated.”

Scafe also knew the feeling of wanting her loans long gone, and fast. “I obsessed over them and I think that’s what motivated me to get rid of them ASAP.” Having multiple loan payments scattered throughout her month was a nuisance.

“I refinanced to lower my interest rate,” she says, but also desperately wanted to have only one monthly payment. Paying down multiple loans faster than their scheduled repayment terms was a logistical hassle, and required significant manual maneuvering. “It got really frustrating.”

Both women refinanced their loans with SoFi, lowering their interest rates and saving them money on interest while consolidating their multiple loans—both federal and private—into one loan with one easy payment.

Tips to Help Pay Off Student Loans Early

“Tracking your spending is a must,” says Gould. She used Mint to track her spending, though there are many methods of doing so. The important thing, says Gould, is to do it. “The difference between months I looked at my budget frequently and months I didn’t was about $300 to $500 of savings, just from being more aware.” And putting those savings towards a student loan payment seriously expedited her loan payoff journey.

When it comes to spending money, try to cut whatever doesn’t bring you true joy. “There is always something forgettable that you are spending money on every month that you can cut.” For Gould, one of these things was dining out. For you, it could be something different, but the lesson here is to identify what really doesn’t produce joy for you, and ruthlessly eliminate it. Spend on only what you love.

“There is no way you can cut out all your expenses, and you need to let yourself have a little leeway to feel like you are living a great life. Some treats I got myself were evening classes in things I found interesting.

I took calligraphy, pottery, Arabic, essay writing. I also have some nice camping gear. I always equated these extra things to lunches—a $10 expense that I wouldn’t miss.”

Scafe, on the other hand, extols the virtues of paying yourself first. Whether you’re paying off loans on an expedited schedule or saving up an emergency fund, it’s wise to spend what is left over after saving and not vice versa.

While you should always keep a buffer in your checking account, too much cash lying around could be just asking to be spent. You can move it towards your loans or a savings account as soon as payday hits instead.

For both women, seeing the light at the end of the tunnel was crucial to their perseverance. They stuck with it, even when it felt like student debt freedom would never become a reality.

For Scafe, having her debt eliminated has been a big stress relief. Gould says that she feels in control of her future and how she chooses to spend her time, and that nothing compares to the feeling of paying off her student debt. And while neither claim that the process was easy, or entirely possible for many on their relatively short timelines, both believe that it was totally worth it.

If you have student loans like Scafe and Gould, keep pushing to reach your goal of being debt free. You can use our student loan payoff calculator to get an idea of when your loan payoff date could be, and it’s never too late to start putting strategies in place to help accelerate your loan payoff—even if it’s just a little at a time.

Also, you can consider refinancing your student loans with SoFi to potentially lower your interest rate and get a shorter term, and therefore help to expedite your own loan payoff journey.

Refinance today! It only takes two minutes to check your rate.

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Disclaimer: The savings and experiences of members herein may not be representative of the experiences of all members. Savings and experiences are not guaranteed and will vary based on your unique situation and other factors.
The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Notice: SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. SoFi always recommends that you consult a qualified financial advisor to discuss what is best for your unique situation.

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So you’re getting ready to head out on vacation. We’re jealous. As part of any well-planned trip, creating a vacation checklist—including financial aspects—is essential. Perhaps you’ve decided to go all-in on that mid-career sabbatical and you’re ready to take some much-needed time off. Maybe you’re about to take that weeklong trip to Mexico.

Whether you’re headed out for just a few days or stretching beach bum status for a few months, travel can get expensive. Domestic travelers spent $880 billion in the U.S. in 2017, $258 billion of which was spent on food alone. Aside from making sure you packed your phone charger and contact lens solution, planning a vacation checklist will help you prepare financially before you hit the road.

Funding Your Vacation

Is your vacation fully funded? Be sure you estimate vacation costs, including airfare, accommodations, transportation, food, drinks, fun activities, and any shopping or souvenir buying you might do. A fun five-day vacation loses some of it, well, fun if you’re still paying it off three months later.

A great way to avoid going into debt for a vacation is to estimate your vacation costs upfront and then set aside a travel allowance each month. Use fare comparison sites like Expedia or Booking.com to get an idea of how much your trip will cost. The top two spending categories for domestic and international travelers are food and lodging , so make sure you include these expenses.

Add up the totals to get an estimate and then divide the total by the number of months before you take your trip. Then you can set aside a monthly allowance which will hopefully be what you need by the time you travel. For example, if you estimated $1,000 for a trip to Florida in five months, plan on setting aside around $200 each month into a designated travel account.

Designate a Vacation Financial Planner

This doesn’t have to be someone you hire, but someone who will hold you accountable and keep you from going overboard. Think of a vacation financial planner as someone who can accurately forecast travel expenses and anticipate unforeseen expenses, like extra cab rides to and from the airport or tips for tour guides.

Being able to plan for these types of expenses can potentially help you feel more at ease while on vacation. Instead of waking up each day in paradise in a cold sweat because you forgot about the 10% hotel daily surcharge, you’ll hopefully wake feeling well-rested and ready for that fancy umbrella-topped drink.

Credit or Cash?

How will you spend money while you’re on vacation? Whether you take cash, credit, or a bit of both, decide on how you will make purchases. If you are traveling internationally, be aware of foreign transaction fees with credit cards, currency exchange rates, and one time change fees when converting cash into foreign currency.

Finance your vacation with a vacation loan or travel credit card, but be sure you have enough cash to cover all travel expenses. Select a credit card that has travel advantages, like zero foreign transaction fees and rewards travel purchases such as rental car bookings and dining out.

By using one card during your vacation, it makes it easier to review associated transactions at the end of the month. You also may rack up more rewards points when you use a card that’s specifically tied to travel.

Cash also has its advantages whether you’re laying oceanside or hiking a new trail. When you use cash during vacation, you don’t want the hassle of logging on to a credit card account and paying your bill after the fact.

Try taking a $20 bill (or the country’s equivalent) out with you during the day and see how far you get. Using cash encourages more of an emotional attachment to the money versus swiping plastic. You may think twice about the souvenir magnet that costs $12, thus saving you money while in vacation mode.

Alternatively, you may choose to use a debit card that withdraws money directly from your checking account. A more organized approach could be a separate checking account with debit card privileges that’s specifically for vacation use only. This way, you keep ordinary transactions separate from vacation transactions.

Money for Miscellaneous

Be sure to include money for miscellaneous vacation expenses as part of your vacation checklist. Trekking across New York City and using Google Maps on your phone to get around? App usage may drain your battery, resulting in the need for a portable charger on the fly. Try your best to account for any unexpected expenses that might occur.

Consider setting aside $50 for miscellaneous expenses like earplugs for noisy hotel rooms, cold and cough medicine for travel-related illnesses, or replacement contact lens solution and a toothbrush if you forget yours somewhere.

Create Travel Notifications

Create a travel notification when preparing for a trip. Call your credit card and bank companies and let them know the dates and locations of your vacation.

This will prevent any temporary holds or freezes companies will put on your account if they see unusual activity. Call seven days prior to departure to ensure your travel notification is ready to go when you are.

Account for any bills that might be due while you are away. Make sure automatic payments are put into place or pay bills before you go. There’s nothing worse than coming home from a great vacation only to find you’ve been slapped with late fees on a cell phone or internet bill that you forgot to pay.

Bring the Confirmation

If you pre-booked your transportation or accommodations, bringing payment confirmation along with the credit or debit card you used to pay will help expedite the check-in process.

Often times, the receipt will include a confirmation or reference number which can help the service desk member find your reservation more quickly and can help dispute any discrepancies in charges.

Okay, Now You’re Ready to Go

Planning for a vacation can be stressful. Dealing with unexpected expenses can make it worse. Fortunately, with a vacation checklist, vacation financial planner, and a way to finance your vacation, the whole process can be much easier, letting you lay back, relax, and enjoy.

Want to make it easy to finance your next adventure? Set up a SoFi Checking and Savings® checking and savings accounts account charges no account fees (subject to change). Learn how to get the most out of SoFi Checking and Savings.

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External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

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SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2022 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
SoFi Money® is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member
FINRA / SIPC . SoFi Securities LLC is an affiliate of SoFi Bank, N.A. SoFi Money Debit Card issued by The Bancorp Bank.
SoFi has partnered with Allpoint to provide consumers with ATM access at any of the 55,000+ ATMs within the Allpoint network. Consumers will not be charged a fee when using an in-network ATM, however, third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.

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You’ve got stacks of bills on your desk. There are old, never-opened bank statements shoved into a drawer and money sitting in accounts at five different banks; no—six different banks.

It’s getting to the point where it is annoying and stressful. Maybe it even keeps you up at night, or you beat yourself up for having not taken action.

But mostly, you know that it doesn’t have to be this way. The time has come to organize your finances.

The hardest part of organizing your finances is knowing where to start. Luckily, there are some very simple steps you can take and starting is as much a matter of motivation as anything else.

You just have to sit down and do it.

It also helps to have some guidance to nudge you in the right direction. So if you’re feeling lost about how to organize finances, we’re outlining six steps that will help you to put your money in order.

What’s great about organizing your finances is that the work is front-end heavy. It might take you a few weeks to get the hang of it, but once you do, maintenance and upkeep are relatively simple.

How to Organize Finances

Here are some ideas on how to organize your finances at home, written out step by step.

Step One: Gather Statements

A great first step is to gather up statements and logging into all accounts. (Arguably, the hardest part.) More specifically, you need to know information about your assets, liabilities, income, and expenses.

Assets: Bank accounts, retirement accounts, home equity, other real estate or investments

Liabilities: Credit cards, student loans, mortgage(s), other sources of debt

Income: Salary, gifts, alimony, investment income, business income, etc.

Expenses: Credit card and debit card statements, ATM or cash withdrawals, other sources of spending

Organize this information using files, spreadsheets, or whatever else works for you. Of the four categories, “expenses” is the most difficult category for which to gain a clear picture. For now, simply identify the ways in which money is leaving your pocket.

Later, we will create a budget, but your job right now is to determine where the money is leaving from each month.

Step Two: Determine Your Goals

Once you’ve got all your documents in place, it’s time to think about your financial goals. Think about what you’d like to accomplish in the next year, five years, and ten years. It helps to write these down.

Some ideas?

Saving up an emergency fund and paying down all high-interest debt like credit cards are two great places to start. Beyond this, work on putting a percentage of your salary away for retirement or saving for a down payment.

While you’re at it, write down your “fun” money goals such as travel and a wedding. Once you’ve done this, put a price on each of these goals, and a date you’d like to achieve them by.

When you go through this exercise, you may notice that you can’t work on all of your goals quite yet. That’s okay; simply put them in order of highest priority to lowest, and start from the top of that list.

Step Three: Consolidate Where You Can

Having lots of different credit cards and bank accounts can get too confusing to manage properly.

Credit cards:

If you are able to successfully manage having credit cards (paying off the balance in full each month), then you may want to whittle down to having just one or two cards. If you have multiple cards with balances, work on paying them off, one by one (while continuing to make minimum payments on all cards).

You can do this in the traditional way, by paying off the cards with the highest interest rate first (called the “avalanche” method), or by chipping away at the card with the smallest balance first (the “snowball” method). Just choose one, and pick off those credit card balances.

Those with high-interest credit card debt could also consider paying off cards with a personal loan at a lower interest rate. A lower interest rate could help borrowers to pay their debt back faster, but it should be noted that this strategy doesn’t cut to the root of the problem of why the debt exists in the first place.

Bank accounts:

First, determine what accounts you need. For most people, it will be some combination of a checking account, savings account for mid-term savings goals, one or two retirement accounts, and perhaps a Health Savings Account and accounts designed specifically for kid’s college. Of course, some folks may find that having more accounts helps them manage their money better. Figure out what works for you.

If you have multiple, old, obsolete accounts floating around, it’s time to start consolidating. Merge accounts where it makes sense, and close accounts that you don’t use. Get all of your money exactly where it needs to be. This is arguably the most difficult step in the process, but it’s important.

These days, there are more different kinds of accounts than ever before. This is great because people have so many options, but it’s difficult because, well, there are so many options. If you’re looking for a simple account that has the ease of use of a checking account and the interest rate of a high-yield savings account, take a look at SoFi Checking and Savings®. This could be an all-in-one checking and savings account that you’re looking for.

Step Four: Track Your Spending

Now that your goals have been decided and accounts are in place, it’s time to build out a framework for budgeting. And before you can build a budget, you have to take some time to track your spending.

Tracking spending is going to look a little bit different for everyone. You may need to try a few different methods before you find what works best for you. Some ideas: Track your spending old-school style in a notebook, with pen and paper, tracking spending in Excel using downloads from your banks, or using an app like SoFi Relay.

After tracking your spending for two months (it is also possible to track backwards, if you want to get moving fast on your financial organization), take a look at your spending patterns. Some spending might be straightforward, like rent or mortgage loan payments. Other spending categories might surprise you. The idea here is to have a realistic idea of your monthly cash flow so that you can build a budget plan.

While you are tracking your monthly inflows and outflows, take note of whether you have extra money left over at the end of the month, are breaking even, or are dipping into savings or using credit to cover the difference. If you spent more than you earned, does this happen often? Understand your patterns.

Step Five: Build A Budget

There’s a reason that you track your monthly cash inflows and outflows before you build a budget. Without some idea of what you’re actually spending in each major budgetary category, you have no real basis for which you can build one. With a starter budget, the first goal is to be realistic and to learn your spending patterns. The second goal is to use it as a framework to spend less and save more.

Your next step is to build out budget categories. Again, these will be different for everyone, but some common categories include Rent/mortgage payment, insurance, utilities, groceries, entertainment, dining out, medical costs, transportation, housing supplies, toiletries, clothes, debt payments, and incidentals.

As your monthly budget and budgeting technique becomes more streamlined, you’ll be able to determine the areas you want to pare back on. Ultimately, the goal is to build savings right into the budget plan.

Step Six: Automate Where You Can

One of the single greatest things you can do to make your financial life easier is to automate wherever it makes sense. Every time you automate, you remove some amount of labor and emotional stress from your life.

The first way to do this is through automatic bill-pay services. You can set most of your utilities to automatically deduct money from your account or charge a credit card. For bills that aren’t compatible with auto-pay, set yourself a reminder to pay on your calendar so that you won’t forget.

Next, automate your savings. Doing so with a 401k through your work is a great option if you have access to one. If you want to save money outside of a workplace retirement plan (or don’t have one), it is also possible to set up an automatic contribution to a savings account of your choice. You can do this once or twice a month, based on how much you want to save and your payment schedule.

When it comes to organizing finances, the hardest part is just getting started. Don’t feel like you have to do all of these steps in one night, but do give yourself a timeline to complete them. You’ll be so happy you did. Once your financial infrastructure is set up and in you’re in groove, maintenance is easy as pie.

Ready to get your money organized? Check out SoFi Checking and Savings account that has no account fees.

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External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2022 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
SoFi Money® is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member
FINRA / SIPC . SoFi Securities LLC is an affiliate of SoFi Bank, N.A. SoFi Money Debit Card issued by The Bancorp Bank.
SoFi has partnered with Allpoint to provide consumers with ATM access at any of the 55,000+ ATMs within the Allpoint network. Consumers will not be charged a fee when using an in-network ATM, however, third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.
SoFi members with direct deposit activity can earn 4.50% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a deposit to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate.

SoFi members with Qualifying Deposits can earn 4.50% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant.

SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.50% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.

Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.

Interest rates are variable and subject to change at any time. These rates are current as of 8/9/2023. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet..

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Studies show that disagreements about money —how to spend it, how much to save each paycheck, and how to split living expenses—are the reason most couples fight. One of the best ways to avoid arguments over finances is talk about your financial goals and work together to create a budget you both can live with.

Here are nine tips to create a “couple budget” and help avoid those fights in the future.

Don’t Be Afraid to Talk About Money

Most couples go to great lengths to avoid talking about money, especially if one or both carry a large amount of debt. But it’s important to be upfront about your income, savings, debt, and spending habits before you try to set up a budget together.

Don’t try to hide how much you owe or how much of your paycheck you typically spend each month. A SoFi survey found that even the most communicative couples will go to great lengths to hide their financial information from each other, including keeping secret bank accounts, lying about their spending, and hiding their debt.

Be Upfront About Your Financial Goals

Talking about money also means sharing your money goals. Your partner’s aim might be to become a millionaire by the age of 40. You might be happy to just get out of debt.

Whether you are saving to buy a house or hoping to pay off your student loans in five years, you and your partner need to have a clear understanding of each other’s financial goals so that your budget supports both of you. You may also want to create a shared long-term goal for you to work on as a couple.

Track Your Daily Expenses

Before you try to set up a budget as a couple, you’ll want to understand how much of your income you each spend every month. Create a spreadsheet to keep track of how much you are spending each month on housing, utilities, entertainment, groceries, transportation, health care, insurance, eating out, personal care, clothing, travel, loans, and child care, if applicable.

For an easy way to track your money, sign up for SoFi Relay. With SoFi Relay you can keep tabs on your cash flow and spending habits, plus find ways to save, in real time.

Agree to a Budget and Stick With It

Committing to a budget isn’t always easy, but a good rule of thumb is to put 20% of your income towards savings, 50% towards necessities such as housing, utilities, and groceries, and 30% towards discretionary spending such as eating out and entertainment.

Another way to approach your budget is to list all your sources of income and monthly expenses and compare the two. Ideally, you should have more income than expenses.

You and your partner can decide how to use the difference, whether it is adding money to a retirement account or saving up for a dream vacation or a down payment on a new home.

Set Up a Weekly Meeting

Talking about money doesn’t end with disclosing your income, bills, and goals, and then agreeing to a monthly budget. Many couples set up a weekly meeting to discuss upcoming bills and expenses.

You can use this time to make any adjustments to your budget or plan for any unexpected expenses and determine how to use any unanticipated income such as a bonus or inheritance. It will also allow you to discuss and evaluate any long-term financial goals.

Be Open About How You Will Handle Debt

Be upfront with your partner about how much you owe, whether it is credit card debt, a student loan, a car loan, or all three.

Then make a plan for tackling that debt as well as deciding together what your new financial goal will be once you and your partner are no longer using discretionary income to pay off debts.

Make Sure You Have an Emergency Fund

Many people agree that it’s important to set aside three to six months worth of living expenses in case of an accident, illness, or job loss.

Even if you can’t set aside enough money to cover a full three month’s worth of expenses, it can be a good idea to set aside at least a few hundred dollars in case of an unexpected expense.

Don’t Forget About Retirement

While retirement may seem like a long way off, you and your partner should still factor contributing to a retirement account into your budget plans. Even if you’re paying off debt, saving for retirement should be an important part of your budget. You’ll both thank yourselves later.

Decide How to Split Costs When Living Together

Even if you don’t want to combine your checking and saving accounts, you will need to come up with a plan for sharing household expenses.

One way to split costs when you live together is to set up a household account that you each put money into. This account would be used to pay for any shared expenses such as housing, utilities, and groceries, as well as shared entertainment expenses.

SoFi Checking and Savings Can Help Keep Track of Your Money

SoFi Checking and Savings, a checking and savings account, allows you to transfer money to other people with no fees through its peer-to-peer transfers. If the other person also has a SoFi Checking and Savings, the transfer is instant.

Looking for strategies for creating a budget with your partner? SoFi Checking and Savings helps you keep track of your money. Learn more today.

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External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2022 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
SoFi Money® is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member
FINRA / SIPC . SoFi Securities LLC is an affiliate of SoFi Bank, N.A. SoFi Money Debit Card issued by The Bancorp Bank.
SoFi has partnered with Allpoint to provide consumers with ATM access at any of the 55,000+ ATMs within the Allpoint network. Consumers will not be charged a fee when using an in-network ATM, however, third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.
SoFi members with direct deposit activity can earn 4.50% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a deposit to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate.

SoFi members with Qualifying Deposits can earn 4.50% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant.

SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.50% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.

Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.

Interest rates are variable and subject to change at any time. These rates are current as of 8/9/2023. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet..

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