SoFi

Scholarships can be a helpful resource to pay for grad school and are available through many different avenues, including states, organizations, nonprofits, companies, and more.

Grants and scholarships are similar in that they’re both gift aid that typically doesn’t need to be repaid after graduation. The main difference is that scholarships are usually merit-based, while grants are need-based.

Let’s look at some common scholarships and grants for prospective graduate students.

State Scholarships & Grants

To find scholarships and grants at the state level, you can try contacting your state’s Education Department for assistance and resources. Scholarships and grants vary state by state, but here are 11 options you may want to consider:

Graduate Tuition Assistance Grant (Colorado)

Provides financial support to graduate students enrolled at participating Colorado public universities. Awards are need-based and subject to fund availability.

Kansas Comprehensive Grant (Kansas)

Offers need-based grants to Kansas residents attending state universities, private colleges, or community colleges for graduate programs.

Massachusetts Gilbert Matching Student Grant (Massachusetts)

Supports financially needy graduate students attending participating colleges in Massachusetts.

Texas Public Education Grant (TPEG) (Texas)

Available to graduate students with demonstrated financial need attending Texas public colleges or universities.

Florida Student Assistance Grant (Florida)

Offers need-based aid to graduate students enrolled in eligible Florida postsecondary institutions.

New York State TAP for Graduate Studies (New York)

Provides financial aid for eligible New York residents pursuing graduate degrees at participating institutions within the state.

Oregon Chafee Education and Training Grant (Oregon)

Supports former foster youth pursuing graduate studies in Oregon with financial need.

North Carolina Education Lottery Scholarship (North Carolina)

Available to graduate students who demonstrate financial need and meet residency requirements.

Georgia Tuition Equalization Grant (Georgia)

Offers financial assistance to graduate students attending private colleges in Georgia, encouraging participation in higher education.

Maine State Grant Program for Graduate Students (Maine)

Provides financial aid to graduate students with financial need attending eligible institutions in or out of Maine.

California Graduate Equity Fellowship Program (California)

Provides financial support to economically or educationally disadvantaged graduate students at participating California State University (CSU) campuses.

Recommended: The Differences Between Grants, Scholarships, and Loans

Federal Scholarships & Grants

To apply for federal grants and scholarships, students will need to fill out the Free Application for Federal Student Aid, or FAFSA®, each year. There are several types of federal grants available, including:

Teacher Education Assistance for College and Higher Education (TEACH) Grants

Teacher Education Assistance for College and Higher Education (TEACH) Grants provide up to $4,000 per year for students preparing to become teachers in high-need fields. In exchange, recipients must agree to teach for four years at an eligible low-income school.

Fulbright Grants

The U.S. Education Department provides Fulbright Grants for graduate students to study and research in designated countries abroad.

When you visit the Fulbright website, click on your country of interest to view the details. For example, in Germany, there are 70 study/research grants available, the program lasts for 10 months, and its recommended participants speak German at the beginner level. In Iceland, there are only seven grants available, the program lasts nine months, and there is no foreign language requirement.

Finding Additional Federal Grants

To find additional federal grants for graduate school, take a look at Grants.gov or the U.S. Department of Labor’s database. On these sites, students can specify their search by things like their program, field of study, or other qualifiers.

National Science Foundation (NSF) Graduate Research Fellowship

The National Science Foundation (NSF) Graduate Research Fellowship Program (GRFP) provides generous funding to outstanding graduate students pursuing research-based master’s or doctoral degrees in STEM fields. Fellows receive a multi-year stipend and cost-of-education allowance, giving them financial support and research flexibility early in their careers.

Private Graduate Scholarships & Grants

When it comes to paying for grad school, there are plenty of organizations, companies, and nonprofits that offer scholarship opportunities. The scholarships could be merit-based, need-based, or simply granted based on your affiliation or application. Some scholarships are on the smaller side, others much larger, but any amount of aid can help. You may want to consider these elements while you’re on the hunt for private scholarships for graduate school:

Your College or University

Your school might offer merit-based scholarships or grants for college. To see what your school offers, connect with the office of financial aid to see if you qualify for any scholarships from the school and what additional steps you may need to take to apply.

Your Course of Study

You may be able to find scholarships related to your field of study. To find scholarships in your area of study, search national foundations or companies that might provide a scholarship. This might be especially helpful in STEM fields and other careers where there’s a high need for employees in the workforce.

Recommended: Scholarships for STEM Students

Your Neighborhood

Another way to find scholarships as a grad student is to see if your religious organization, local civic group, or other community organizations you belong to offer scholarships. You could reach out to see what may be available and perhaps complete the necessary applications.

Your Background

Based on your ethnicity or cultural heritage, you may be able to qualify for several scholarships or grants. Reach out to national foundations or local community groups to see what they offer.

Some specific private scholarships and grants include:

Greek Life Scholarships

Contrary to what society may think, enrolling in a fraternity, sorority, or other Greek organization has more benefits than the wild parties. Many Greek organizations reward their high-achieving members and alumni who pursue master’s degrees.

For example, members of Alpha Chi Rho could receive up to $3,000 for their graduate studies.

The Harry S. Truman Scholarship

The Truman Scholarship is for students who want to make a difference in society. If you’re pursuing a degree, such as Master of Public Administration, Master of Education, or Master of Social Work, and you have significant community service experience, you could qualify for the Truman Scholarship.

To apply, you must be pursuing any major that could lead to a career in public service and interested in a graduate degree. Between 55 and 65 students receive the Truman Scholarship per year, each receiving up to $30,000.

Government Finance Officers Association (GFOA) Scholarships

GFOA Scholarships are for graduate students intending to pursue a career in state or local finance. The association offers 11 scholarships ranging from $5,000 to $30,000.
The four kinds of graduate school scholarships are as follows:

•   The Goldberg-Miller Public Finance Scholarship for full-time students. Award amount is $30,000.

•   The Frank L. Greathouse Government Accounting Scholarship for full-time accounting students. Award amount is $10,000.

•   The Clark Burrus Public Service Academic Scholarship for minority students studying for a career in state or local government finance. Award amount is $10,000.

•   The Betty Jo Harker Professional Development Scholarship for part-time graduate students. Award amount is $10,000.

NCAA Postgraduate Scholarship

The NCAA Postgraduate Scholarship is for athletes who have attended an NCAA member institution for their undergraduate studies. Students must be in their final year of undergraduate athletics to apply.

The distribution of graduate school scholarships is unique. Three times per year (autumn, winter, spring), the NCAA gives scholarships to 21 men and 21 women per each sports season, for a total of 126 scholarships per year. This timeline splits up candidates based on the sport they play. Each scholarship is $10,000.

American Association of University Women

The American Association of University Women (AAUW) Fellowships and Grants program provides substantial financial support to women pursuing graduate study, research, and professional development across a wide range of fields. These awards help recipients cover tuition, living expenses, and project costs, with specific programs dedicated to career changers, international scholars, and women advancing in male-dominated disciplines.

The Career Development Grant recipients will receive up to $8,000 for graduate school.

The Geological Society of America Grant

If you’re going into geological research, joining the Geological Society of America (GSA) and applying for their Graduate Student Research Grant may open up some opportunities. The GSA awarded 354 students money in 2025, with roughly 52% of students that applied receiving aid. The average grant amount was $2,688.

These are only a few avenues to consider when looking for private graduate school scholarships. Databases and search engines can help, but don’t be afraid to get creative.

Recommended: Paying for College Without Financial Aid

Fellowships

Unlike a grant or scholarship, graduate fellowships are money typically tied to an opportunity. Those who get a fellowship likely have to meet requirements to study, research, or work in a field for a short period. Not only will fellowships help students pay for graduate school, but they can also be a valuable opportunity to gain relevant experience.

Finding a fellowship will be specific to your field of study. One place to start your search process is by talking to your academic department for assistance or finding a nonprofit institution specializing in your field of study. Applicants should be aware that fellowships typically require a fairly rigorous application process.

The Paul & Daisy Soros Fellowships for New Americans

The Paul & Daisy Soros Fellowships for New Americans is a prestigious program that supports immigrants and children of immigrants pursuing graduate education in the United States. Each year, the fellowship provides generous funding for tuition and living expenses, empowering recipients to fully focus on their academic and professional goals.

Since 1998, the program has awarded over $80 million to 805 Fellows from 103 countries, supporting graduate studies in a wide range of fields — from screenwriting and painting to medicine and neuroscience.

How to Qualify for Graduate School Scholarships

Qualifying for graduate school scholarships involves careful planning and preparation. Below are tips to help you qualify:

•   Start by researching types of scholarships specific to your field of study, location, or demographics.

•   Maintain a strong academic record, as many scholarships prioritize academic excellence.

•   Demonstrate leadership, community involvement, and unique skills, which can set you apart from other applicants.

•   Craft a compelling personal statement that highlights your achievements, goals, and passion for your field.

•   Submit all required materials, such as transcripts, letters of recommendation, and essays, by the deadlines.

•   Make sure to apply for multiple scholarships to increase your chances of success, ensuring you meet the specific eligibility criteria for each opportunity.

Academic Achievement and Professional Goals

Graduate school scholarships often prioritize students who demonstrate strong academic achievement and clear professional goals. High GPAs, test scores, and a record of academic excellence can make applicants more competitive, while well-defined career objectives show scholarship committees that you have a purposeful plan for applying your education.

Recommended: What Is a Pell Grant?

Where to Find Scholarships for Graduate Students

When looking for scholarships for grad school, filling out the FAFSA is the first step. Just like undergraduates, the FAFSA is required for graduate students interested in federal student aid, including scholarships, grants, and student loans. Some schools may also use the FAFSA to determine aid awards.

Community organizations can be another source of scholarships. Some career or professional organizations may also offer scholarships.

Scholarship Databases and University Financial Aid Offices

From there, you can check in with your school’s financial aid office. They may have more information on the scholarship opportunities and requirements available at your school.

Scholarship databases compile thousands of scholarships in one place, allowing students to filter by field of study, eligibility, and award amount. SoFi’s scholarship search tool, for example, helps students quickly identify relevant scholarships, making it easier to find both school-specific and external awards that align with their academic and professional goals.

When to Apply for Graduate School Scholarships

Fill out the FAFSA as early as possible. Some aid may be awarded on a first come, first served basis, so completing the application early could potentially improve your chances of qualifying for some aid.

For private scholarships, be sure to track all relevant deadlines. Each scholarship may have its own deadline, so it may help to put together a spreadsheet so you can see a high level overview of important deadlines and application requirements.

Application Timing for Fall vs. Spring Admissions

Application timing can significantly impact your chances of receiving graduate school scholarships, depending on whether you’re applying for fall or spring admissions. Many scholarship deadlines align with fall entry, so students aiming for a spring start may have fewer opportunities or tighter timelines. Planning ahead and submitting materials early ensures you meet all deadlines and remain competitive for available funding, regardless of your intended start term.

Recommended: FAFSA Guide

Factors to Consider When Applying for Graduate School Scholarships

Applying for scholarships is a time commitment, but it may be time well spent if you can secure money to help pay for your graduate school program. Consider the following factors when applying to graduate school scholarships:

Eligibility Requirements

Review eligibility requirements closely. Do you need to be enrolled in a specific school or program of study? Be sure you understand and meet the eligibility requirements so you don’t waste time applying for grad school scholarships you aren’t actually eligible for.

Application Requirements

Some applications may require an essay and letters of recommendation. Think carefully about who you want to ask to write a letter of recommendation on your behalf. Be mindful of deadlines and ask with enough advance notice to give them enough time to write a letter.

Deadlines

Each scholarship may have its own deadlines. Track these closely. Many scholarships won’t accept late submissions.

Some scholarships may go unclaimed when the school year starts. Consider checking in with your financial aid office to see if there are any unclaimed scholarship funds available. For more information on appealing for these awards, take a look at SoFi’s guide to unclaimed scholarships.

Renewal Terms and Conditions

Many scholarships are only awarded for one year or require recipients to meet specific criteria to maintain funding, so it’s important to read the renewal terms and conditions of the scholarships you receive. Students may need to maintain a minimum GPA, be enrolled full-time, or continue in a particular field of study. Understanding these requirements upfront helps students plan academically and financially, avoid losing their award unexpectedly, and ensures long-term support throughout their graduate program.

Using Student Loans to Cover Grad School

Scholarships and grants aren’t the only options for paying for graduate school. You may also choose to take out graduate student loans.

Consider focusing on scholarships and grants before student loans, as those don’t need to be repaid. Student loans, on the other hand, will have to be paid back. If you’re applying for graduate federal or private loans, it’s worth noting that you can borrow more as a graduate student, but you might be looking at higher interest rates.

If you don’t receive enough financial aid through federal loans, you can consider private student loans. Rather than being provided by the government, these loans come from private businesses, banks, and online lenders. Students should focus on private student loans as a last resort, as private student loans lack the borrower protections afforded to federal student loans.

Alternative Funding for Graduate School

Other than taking on student loans, there are several alternatives to funding your graduate degree. If you’re able to work while attending school, you can save and budget to cover a portion or all of your tuition.

Employer Tuition Assistance

If you are working, you can speak with your employer to see if they offer a tuition reimbursement program. Employee tuition reimbursement might require you to stay at the company for a number of years or pursue a specific degree. Program requirements will vary by company.

Graduate Assistantships and Teaching Roles

Graduate assistantships and teaching roles offer graduate students a valuable way to fund their education while gaining professional experience. In exchange for assisting with research, teaching undergraduate courses, or supporting academic departments, students often receive tuition waivers, stipends, or both. Speak with your particular university for specific details.

The Takeaway

There are a wide array of grants and scholarships available for students pursuing graduate school. These include those offered by federal and state governments, individual schools, and other interest groups like nonprofit organizations. To find grants and scholarships, students can review online databases, speak with the financial aid office at their school, and fill out the FAFSA each year.

In addition to scholarships, students can pay for graduate school with cash savings, grants, and federal and private student loans.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

Cover up to 100% of school-certified costs including tuition, books, supplies, room and board, and transportation with a private student loan from SoFi.

FAQ

How do I get a full scholarship to graduate school?

It’s possible to get a scholarship that will pay for all of your graduate school costs. It can be very competitive to qualify for full-ride scholarships, so it may help to complete an application and make sure you meet all the requirements. If an essay is required, be sure to allocate enough time for writing and editing so that you are submitting a strong application. Some schools may offer full-ride scholarships to the top students.

Do master’s programs give scholarships?

Yes, many master’s programs offer scholarships to help offset tuition costs. These can include merit-based awards, need-based scholarships, and funding for specific fields of study. Additionally, universities, private organizations, and government programs often provide scholarships tailored to graduate students pursuing advanced degrees in various disciplines.

Are scholarships available for graduate school?

Yes, scholarships are available for graduate school. Fill out the Free Application for Federal Student Aid if you are interested in federal scholarships or grants. Check in with your school’s financial aid office for more resources.

Can I apply for scholarships if I’m already enrolled in grad school?

Yes. Many scholarships allow applications from students already enrolled in graduate programs. Schools, professional organizations, and private foundations often offer awards for current students to help cover ongoing tuition, fees, or living expenses. Always check eligibility requirements, as some scholarships target specific years, fields, or academic progress.

How can you find scholarships for graduate students?

Graduate students can find scholarships by checking their university’s financial aid office, searching online scholarship databases, and exploring awards from professional associations in their field. Local nonprofits, employers, and community organizations also offer funding.

---

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

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.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

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.

Third Party Trademarks: Certified Financial Planner Board of Standards Center for Financial Planning, Inc. owns and licenses the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®

SOISL-Q425-046

Read more

If you already have a personal loan but need more funds, you may wonder if you can take out another one. Some lenders will approve you for a second personal loan if you stay under their maximum borrowing cap. You may also be able to get a new personal loan from a different lender, provided you meet their requirements. Already having a personal loan, however, could make it harder to get approved.

Read on to learn more about how many personal loans you can have at once, how stacking personal loans can impact your credit, and alternatives to consider.

Can You Have More Than One Personal Loan at Once?

Technically, there is no limit on how many personal loans you can have. Whether you can get approved for a second or third personal loan will depend on the lender and your qualifications as a borrower.

Some lenders limit the number of concurrent personal loans you can have to one or two. They might also restrict you to a maximum borrowing amount (such as $50,000) across all of the personal loans you hold with them.

If you’re maxed out with your current lender, you may be able to get a new personal loan with a different lender. Generally, lenders don’t reject applicants solely due to having an existing loan. However, they may decline approval if they feel you carry too much debt and might struggle to make an additional payment.

Does It Ever Make Sense to Have Multiple Loans?

There are some situations where it can make sense to have more than one personal loan. If you took out a loan to consolidate credit card debt and then got hit with an unexpected medical or car repair bill, for example, you may be better off getting a second personal loan rather than running up new and expensive credit card debt. Before taking out another personal loan, however, it’s worth checking to see if you might qualify for a lower-cost way to borrow money (more on that below).

If you’re looking to get another personal loan to bridge a gap between your spending and income, on the other hand, taking on additional debt could add to the problem. You may be better off looking at ways to reduce expenses and pay down your existing debt.

Pros and Cons of Taking Out Multiple Personal Loans

If you’re seriously considering taking out a second or third personal loan, it’s wise to familiarize yourself with the benefits and disadvantages of doing so.

Pros of Multiple Personal Loans

On the plus side, pros include:

•   Access to more cash

•   Often a quick approval and disbursement process

•   Ability to use loans for different purposes, such as debt consolidation and a home improvement project

•   Credit building, provided the debts are handled responsibly

Cons of Multiple Personal Loans

Next, consider the downsides of taking out multiple personal loans:

•   Spending more on interest

•   More stress on your budget, perhaps meaning you can’t save as much

•   Increased debt-to-income ratio (DTI)

•   More opportunities to miss a payment, which can negatively impact your credit score

•   Applying for new loans typically lowers your credit score by several points temporarily

Here is this information in chart form:

Pros of Multiple Personal Loans	Cons of Multiple Personal Loans
Access to more cash	Spending more on interest
Quick approval and disbursement	Stress on your budget
Flexible uses	Increased DTI
Credit building if loans are managed responsibly	More opportunity to miss a payment, which can lower your credit score
	Applications require a hard credit pull which can temporarily lower your credit score

Ways Multiple Personal Loans Can Affect Your Credit

Having multiple personal loans can have both negative and positive impacts on your credit, as noted above. Any time you apply for new credit, the lender will do a hard pull on your credit, which can cause a small, temporary dip in your scores. Multiple hard credit inquiries in a short period of time, however, can significantly harm your credit. Late or missed payments can also negatively affect your credit score.

On the plus side, taking out a new personal loan and handling it responsibly (by making on-time payments) can positively influence your credit over time.

Other Potential Complications

Here’s a look at some other ways that having multiple personal loans can affect your finances.

•  Multiple payments: A new personal loan means a new monthly payment. Before you add to your debts, it’s a good idea to review your budget to ensure you can manage an additional monthly loan payment.

•  Debt-to-income ratio: Each personal loan impacts your debt-to-income ratio (DTI). This ratio measures how much of your monthly income goes toward current debt. A higher DTI can make it harder to qualify for other types of loans, such as a mortgage, in the future.

•  Higher interest rates: A lender could approve you for an additional personal loan but at a high annual percentage rate (APR), which is the personal loan’s interest rate blended with applicable fees and charges, because of your existing debt.

Getting Multiple Loans From the Same Lender

Before applying for an additional personal loan from your current lender, it’s a good idea to check their policies. Some lenders limit the number of outstanding personal loans you can take out at one time or cap the total amount you can borrow. In addition, some lenders require that you make a certain number of consecutive on-time payments (such as three or six) toward an existing loan before you can apply for another loan.

If you believe you’ll meet the lender’s requirements for a second personal loan — and you feel comfortable making the additional monthly payment — getting an additional loan from the same lender could be a smart strategy.

Recommended: Average Personal Loan Interest Rates

Qualifying for Another Personal Loan

If you apply for a personal loan with another lender, you won’t have to worry about a cap on the number of loans you have or the combined amount you can borrow. However, you will have to go through the whole application process, and the lender will likely perform a hard credit check. They will factor in how much debt you already carry, even though it may be with another lender.

You can get an idea of whether or not you’ll get approved for an additional personal loan by calculating your current DTI. To do this, simply add up all your current debt payments, including any auto loans, mortgage, credit cards, and student loans. If that number comes close to 50% of your monthly gross (pre-tax) income, another personal loan may not be in the cards. The max DTI for a personal loan is typically 50%. However, many lenders like to see a DTI that is less than 36%.

Recommended: Secured vs Unsecured Personal Loans: Comparison

Alternatives to Multiple Personal Loans

When you need to cover unexpected expenses, a personal loan (whether for several hundred dollars or a $15,000 personal loan or more) can be a great resource — but it’s not your only option. Here are some alternatives to personal loans you might consider.

0% Interest Credit Card

If your credit is strong, you may be able to take advantage of a credit card with a 0% introductory APR. The promo rate can last up to 21 months; after that, the card will reset to its regular APR.

If you can use the card to cover your costs and repay the balance before the 0% rate ends, it’s the equivalent to an interest-free loan. If you’ll need a significantly longer period of time, however, this route could end up costing more than a personal loan.

Home Equity Loans or Lines of Credit

A home equity loan or home equity line of credit (HELOC) may be worth exploring if you own a home and have built up significant equity. A home equity loan is a single lump sum you repay (plus interest) over time. A HELOC is a revolving line of credit that you can draw from as needed; you pay interest only on what you use.

Home equity loans and HELOCs are secured by your home, which lowers risk for the lender. As a result, they may come with lower interest rates than personal loans. A major downside of this type of loan is that, if you default on the loan, you can lose your home.

Debt Consolidation Loan

A debt consolidation loan is actually a type of personal loan, but it can be used to replace multiple debts with a single, more convenient loan.

Here’s how debt consolidation works:

•  Say, you already have a $5,000 personal loan.

•  You are also carrying credit card debt totaling a few thousand dollars.

•  Getting a new $10,000 personal loan can allow you to eliminate both of those debts. The funds from the new loan would pay off your existing loan and credit card balances, and you would then make payments on your new single personal loans until it’s paid off.

Having one loan vs. many can help some people avoid paying a bill late or missing a payment altogether.

The Takeaway

You can have as many personal loans as you like, provided you can get approved. Some lenders limit the number of loans they’ll extend to an individual at any one time, or cap the total amount one person can borrow. To get an additional personal loan with a new lender, you’ll need to meet their qualification requirements. Having an existing personal loan could make this harder to do. However, you may get approved if your monthly income is sufficient to cover the new payment. Before you jump in, you’ll want to consider how it will impact your overall debt, credit score, and credit history.

Think twice before turning to high-interest credit cards. Consider a SoFi personal loan instead. SoFi offers competitive fixed rates and same-day funding. See your rate in minutes.

SoFi’s Personal Loan was named NerdWallet’s 2024 winner for Best Personal Loan overall.

FAQ

How long should you wait between loans?

A general rule of thumb is to wait at least six months between applying for new credit. Submitting multiple loan applications in a short time frame can result in several hard inquiries on your credit report, which can lower your credit score. It may also signal to lenders that you are in financial distress, which could make it harder to get approved for a new loan.

Do multiple loans affect credit score?

Multiple loans can positively and negatively impact your credit. Each new loan application can result in a hard inquiry on your credit report, which may temporarily lower your score. Having multiple loans can also increase your debt-to-income ratio, which can make you appear less creditworthy to lenders. If you consistently make on-time payments on all of your loans, however, it can positively impact your credit history over time.

What happens if you pay off a loan too quickly?

Paying off a loan early can have mixed effects. While it can save you interest payments, some lenders may charge prepayment penalties, which could offset the benefits of early repayment. When you’re shopping for loans, it’s a good idea to ask if there is an early payoff fee. Some lenders do not charge them.

Paying off a loan early can also have a slightly negative impact on your credit by bringing down your average credit history length and reducing your credit mix.

Paying off a loan early can also have a slightly negative impact on your credit by bringing down your average credit history length and reducing your credit mix.

Is it legal to have multiple personal loans?

There is no federal law against having multiple personal loans. As long as lenders approve you and you handle the debt responsibly, it should not be a problem. However, note that you typically cannot use personal loans for any illegal uses, business purposes, or tuition payments.

Can you be denied a personal loan if you already have one?

Yes, you can be denied a personal loan if you already have one. The lender may have a cap on how much applicants can borrow that you would exceed with a new loan, or your DTI (debt-to-income) ratio may exceed the amount they are comfortable with.

---

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

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.

This article is not intended to be legal advice. Please consult an attorney for advice.

Third Party Trademarks: Certified Financial Planner Board of Standards Center for Financial Planning, Inc. owns and licenses the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®

SOPL-Q425-055

Read more

Students who graduate with a master’s degree carry an average debt of $69,140, according to the Education Data Initiative. Fortunately, there are many ways to pay for grad school, including options that don’t require borrowing.

Keep reading to learn more on how to pay for grad school in 2025, including how to take out graduate student loans, how to qualify for scholarships and grants, and other ways to reduce your total tuition.

Ways to Pay for Grad School Without Taking on Debt

You can pay for grad school without taking on debt by filling out the FAFSA, applying for scholarships and grants, or working for an employer who offers tuition reimbursement. Continue reading for even more strategies to pay for grad school without taking on debt.

1. Fill Out the FAFSA

The first step to seeing if you qualify for financial aid is to fill out the Free Application for Federal Student Aid, or FAFSA®.

Your FAFSA will determine your eligibility for federal student loans, federal work-study, and federal grants. In addition, your college may use your FAFSA to determine your eligibility for aid from the school itself. Here’s a closer look at federal grants and federal work-study programs.

Federal Grants

Unlike student loans, federal grants do not need to be repaid. Grants for college for grad students include TEACH Grants and Fulbright Grants.

The TEACH Grant, or Teacher Education Assistance for College and Higher Education Grant, has relatively stringent requirements and is available for students pursuing a teaching career who are willing to fulfill a service obligation after graduating.

The Fulbright Grant offers funding for international educational exchanges. Sponsored by the U.S. government, it supports students, scholars, teachers, and professionals to study, research, or teach abroad.

Federal Work-Study Program

Federal work-study for grad students provides part-time jobs to help cover educational expenses. These positions are often related to a student’s field of study or serve the community. Eligibility is based on financial need, and earnings are exempt from being counted as income on the FAFSA, maximizing financial aid opportunities.

2. Figure Out What Your University Can Offer You

After narrowing down your federal options, make sure to consider what university-specific funding might be available. Many schools offer their own grants, scholarships, and fellowships. Your school’s financial aid office likely has a specific program or contact person for graduate students who are applying for institutional assistance.

Many schools will use the FAFSA to determine what, if anything, the school can offer you, but some schools use their own applications.

Although another deadline is the last thing you need, seeking out and applying for school-specific aid can be one of the most successful ways to pay for grad school. Awards can range from a small grant to full tuition remission.

3. Employer Tuition Reimbursement

It might sound too good to be true, but some employers are happy to reimburse employees for a portion of their grad school costs. Employers that have tuition reimbursement plans set their own requirements and application processes.

Make sure to consider any constraints your employer puts on their tuition reimbursement program, including things like staying at the company for a certain number of years after graduation or only funding certain types of degree programs.

4. Become an In-State Resident

If you’re applying for graduate school after taking a few years off to work, you might be surprised to find how costs have changed since your undergraduate days. Graduate students interested in a public university can save tens of thousands of dollars by considering a university in the state they already live in.

Each state has different requirements for determining residency. If you are planning on relocating to attend grad school, be sure to look into the requirements for the state of the school you are planning to attend.

Certain states require only one year of full-time residency before you can qualify for in-state tuition, while others require three years. During that time, you could work as much as possible to save money for graduate school. More savings could mean fewer loans.

Recommended: 6 Ways to Save Money for Grad School

5. Become a Resident Advisor (RA)

Resident Advisors (RAs) help you get settled into your dorm room, show you how to get to the nearest dining hall, and yell at you for breaking quiet hours.

RAs may be underappreciated, but they’re often compensated handsomely for their duties. Students are typically compensated for a portion or all of their room and board, and some schools may even include a meal plan, reduced tuition, or a stipend. The compensation you receive will depend on the school you are attending, so check with your residential life office to see what the current RA salary is at your school.

Serious savings. Save thousands of dollars

thanks to flexible terms and low fixed or variable rates.

6. Find a Teaching Assistant Position

If you’re a graduate student, you can often find a position as a Teaching Assistant (TA) or Research Assistant (RA) for a professor. The position will be related to your undergrad or graduate studies and often requires grading papers, conducting research, organizing labs, or prepping for class.

TAs can be paid with a stipend or through reduced tuition, depending on which school you attend. Not only can the job help you to potentially avoid student loans, but it also gives you networking experience with people in your field.

The professor you work with can recommend you for a job, bring you to conferences, and serve as a reference. Being a TA may help boost your resume, especially if you apply for a Ph.D. program or want to be a professor someday. According to ZipRecruiter, the average TA earns $15.66 an hour, as of November 2025.

Recommended: How to Become a Graduate Assistant

7. Apply for Grants and Scholarships

Applying for grants and graduate scholarships is a smart way to fund graduate school without accumulating debt. Start by researching opportunities specific to your field, school, or demographics. Many scholarships focus on academic achievements, leadership, or community involvement, while grants often emphasize financial need.

An easy way to search for scholarships is through one of the many websites that gather and tag scholarships by criteria. Keeping all your grad school and FAFSA materials handy means that you’ll have easy access to the information you’ll need for scholarship applications.

8. Utilize Military Education Benefits (If Eligible)

Military education benefits can significantly reduce or even eliminate the cost of graduate school for qualifying service members, veterans, and sometimes their families. Programs like the GI Bill® and the Yellow Ribbon Program can cover tuition, fees, and even housing costs at many institutions. Additionally, some branches offer tuition assistance while on active duty, enabling students to pursue advanced degrees with little to no out-of-pocket expenses.

How to Pay for Grad School With Student Loans

Grad students may rely on a combination of financing to pay for their education. Student loans are often a part of this plan. Like undergraduate loans, graduate students have both federal and private student loan options available to them.

Federal Loans for Graduate School

There are different types of federal student loans, and each type has varying eligibility requirements and maximum borrowing amounts. Graduate students may be eligible for the following types of federal student loans:

•   Direct Unsubsidized Loans. Eligibility for this loan type is not based on financial need.

•   Direct PLUS Loans. Eligibility for this loan type is not based on financial need; however, a credit check is required to qualify for this type of loan. As of July 1, 2026, Grad PLUS Loans will no longer be available (Parent PLUS Loans will still be available, however).

•   Direct Consolidation Loans. This is a type of loan that allows you to combine your existing federal loans into a single federal loan.

Federal Student Loan Forgiveness Programs

Federal student loan forgiveness programs either assist with monthly loan payments or can discharge a remaining federal student loan balance after a certain number of qualifying payments.

One such program is the Public Service Loan Forgiveness (or PSLF) program. The PSLF program allows qualifying federal student loan borrowers who work in certain public interest fields to discharge their loans after 120 monthly, on-time, qualifying payments.

Additionally, some employers offer loan repayment assistance to help with high monthly payments. While loan forgiveness programs don’t help with the upfront cost of paying for grad school, they may offer a meaningful solution for federal student loan repayment. (Unfortunately, private student loans don’t qualify for these federal programs.)

Private Loans for Graduate School

If you’re not eligible for scholarships or grants, or you’ve maxed out how much you can borrow using federal student loans, you can apply for a private graduate student loan to help cover the cost of grad school.

Private loan interest rates and terms will vary by lender, and some private loans have variable interest rates, which means they can fluctuate over time. Doing your research with any private lender you’re considering is worth it to ensure you know exactly what a loan with them would look like.

Also, keep in mind that private student loans do not offer the same benefits and protections as federal student loans. It’s best to use all federal funding first before relying on private funding.

Comparing Federal vs. Private Loan Options

Understanding the differences between federal vs private student loans is important when considering grad school loans. Each option offers unique benefits, eligibility rules, and repayment features that can impact long-term costs.

•   Federal loans: These loans are funded by the government and typically offer more borrower protections, such as fixed interest rates, income-driven repayment plans, and potential for deferment, forbearance, or loan forgiveness programs. They usually don’t require a cosigner and are often based on financial need.

•   Private loans: Offered by banks, credit unions, and other private lenders, these loans often have variable interest rates that can be higher than federal loans. They usually require a strong credit history or a cosigner, and their repayment terms and borrower benefits are generally less flexible than federal options.

Recommended: Private Medical School Loans

Steps to Take Before Applying to Graduate School

Before applying to graduate school, it’s important to consider the earning potential offered by the degree in comparison to the cost. At the end of the day, only you can decide if pursuing a specific graduate degree is worth it. Here are a few steps to take before applying to grad school.

1. Research Potential Earnings by Degree

Perhaps you are already committed to one degree path, like getting your JD to become a lawyer. In that case, you should have a good idea of what the earning potential could be post-graduation.

If you’re considering a few different graduate degrees, weigh the cost of the degree in contrast to the earning potential for that career path. This could help you weigh which program offers the best return.

2. Complete the FAFSA

Regardless of the educational path you choose, filling out the FAFSA is a smart move. It’s completely free to fill out and you may qualify for aid including grants, work-study, or federal student loans. Federal loans have benefits and protections not offered to private loans, so they are generally prioritized first.

3. Estimate Your Cost of Attendance

Estimating your cost of attendance will help you understand the full financial commitment beyond just tuition. This estimate should include fees, textbooks, housing, transportation, and personal expenses, as well as potential increases in tuition over time. By creating a detailed budget upfront, you can compare programs more accurately, anticipate funding needs, and avoid surprises once you enroll.

4. Explore Financing Options

As mentioned, you may need to rely on a combination of financing options to pay for grad school. When scholarships, grants, and federal student loans aren’t enough, private loans can help you fill in the gaps.

When comparing private lenders, be sure to review the loan terms closely — including factors like the interest rate, whether the loan is fixed or variable, and any other fees. Review a lender’s customer service reputation and any other benefits they may offer, too.

The Takeaway

Grad school is a big investment in your education, but the good news is there are grants and scholarships that you won’t have to pay back. Some employers may also offer tuition reimbursement benefits, or you could find work as a Resident Advisor to supplement your tuition costs. If you need more funding to finance grad school, there are federal and private student loans.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

Cover up to 100% of school-certified costs including tuition, books, supplies, room and board, and transportation with a private student loan from SoFi.

FAQ

Does FAFSA give money for grad school?

FAFSA provides access to federal financial aid for graduate school, including Direct Unsubsidized Loans and Grad PLUS Loans (through July 1, 2026). Graduate students may not qualify for federal grants but can explore assistantships, scholarships, and work-study opportunities through FAFSA to help cover their educational expenses.

Does Pell Grant cover a master’s degree?

No, the Pell Grant does not cover master’s degree programs. It is a federal grant specifically designed for undergraduate students with financial need. Graduate students must explore other funding options like scholarships, assistantships, and federal loans to finance their education.

Is it worth paying for grad school?

Paying for grad school can be worth it if the degree significantly boosts your career prospects, earning potential, or personal goals. Consider the return on investment, including salary increases and opportunities. Research funding options and weigh potential debt against long-term benefits to determine if grad school aligns with your financial future.

What are the best student loans for graduate school?

The best student loans for graduate school often start with federal options, like Direct Unsubsidized Loans, because they offer fixed rates, borrower protections, and forgiveness eligibility. Private student loans can be a good alternative for borrowers with strong credit who may qualify for lower interest rates and flexible terms.

Can I get scholarships for graduate school?

Yes, you can get scholarships for graduate school. Many universities, private organizations, professional associations, and foundations offer merit-based, need-based, and field-specific awards. You can apply before or during your program, and using scholarship databases or your school’s financial aid office can help you find opportunities that match your background and goals.

---

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

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.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Third Party Trademarks: Certified Financial Planner Board of Standards Center for Financial Planning, Inc. owns and licenses the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®

SOISL-Q425-047

Read more

While there are formulas and calculators that can help you determine a basic amount that you need to save for retirement, these are just ballpark numbers. In some cases it can be useful to game out a couple of different scenarios — using different assumptions about where you might live, whether you’ll work part time or travel, and so on.

Doing this can help you, and your spouse or partner, decide on the retirement path that suits you. It can also help you make the best estimate of how much you need to retire.

How Much Money Do You Need to Retire?

There isn’t a single number you need to retire that will work for everyone. As mentioned, every person’s situation is unique and comes with its own complications and assumptions for what retirement might mean.

Many Americans aren’t sure where to begin when it comes to figuring out the exact amount they’ll need. In a 2024 SoFi Retirement Survey, 75% of adults don’t know how much they will need to retire. Just 1 in 4 have done the calculations to determine the amount, while 41% have a general sense, and 34% have no idea how much they’ll need for retirement.

Source: SoFi’s 2024 Retirement Survey

Fortunately, there are some rules of thumb to consider to help determine retirement savings.

1. Retirement Savings Targets by Age

If you’re just starting out in life, you might think that with retirement decades away that you don’t have to worry about it. But the sooner you start saving for retirement, the better off you’ll be. Here are a few rough targets for how much you should have saved at certain ages:

By Age…	You should target saving this much
30	1X your salary
40	3X your salary
50	6X your salary
60	8X your salary
67	10X your salary

Source: Fidelity, “When Can I Retire”

These should only be considered as very rough guidelines — for more detailed retirement targets, consider working with a financial advisor.

2. The 80% Rule

One basic guideline is known as the 80% rule, which says you should aim to replace 80% of your pre-retirement income. So, if you earn $100,000, you’ll need about $80,000 per year when you retire.

This is only meant as a guideline, but it has been called into question by some experts as being too high. As the thinking goes, your expenses decline in retirement, largely because you’re no longer saving for retirement, nor are you commuting.

Others have said workers should aim to replace 100% of their pre-retirement income, owing to inflation.

3. The 4% Rule

Another popular rule of thumb is the 4% rule, which says that you can take your projected annual retirement expenses and divide them by 4% (0.04) to know how much money you’ll need before you can safely retire.

If you project annual expenses of $50,000, you’ll need $1,250,000 (which is $50,000 divided by 0.04). Then each year you could withdraw 4% (indexed for inflation), which would come mostly if not completely from the appreciation of the portfolio.

Since the 4% rule was introduced in 1994, other advisors have said that it is not conservative enough, due partly to increased longevity, and have suggested 3.33% or even 3.7% might be more appropriate.

💡 Quick Tip: Did you know that opening a brokerage account typically doesn’t come with any setup costs? Often, the only requirement to open a brokerage account — aside from providing personal details — is making an initial deposit.

Are You Currently Saving Enough?

First, take a good long look at how much you’re putting away for retirement. Have you reached —or come close to — the goal of saving 15% to 20% of your income? Unfortunately, many people have not.

In the SoFi Retirement Survey, just 17% of respondents say they’re putting 15% or more of their income toward retirement. The majority are contributing much less. Here’s how the numbers break down:

Retirement Contributions

•   49% contribute less than 10% of their income

•   23% contribute less than 5% of their income

•   17% contribute 15% or more of their income

Of those who are contributing 15% or more of their income to retirement savings, 50% have a household income of $100,000 or more. The older they get, the more likely survey respondents are to contribute. While 32% of those aged 25 to 34 put at least 15% of their income toward retirement savings, the number jumps to 60% for those aged 25 to 44.

Factors That Impact How Much Retirement Savings You’ll Need

When considering how much you’ll need to retire, here are a few things that you will want to keep in mind:

Age You Plan to Retire

In simple terms, your retirement age is the age when you decide to retire. For example, you might set your target retirement date as 62 or 65 or 66 — all of which are related to Social Security benefits in some way.

Social Security has largely shaped how we view retirement age in the U.S. because that monthly payout is what enables the majority of people to leave work. Ninety-seven percent of adults ages 60 or older receive Social Security, according to a 2024 estimate by the Social Security Administration. And most people ages 65 and older say Social Security is the majority of their income, according to an analysis by the Center on Budget and Policy Priorities, a nonpartisan research and policy institute.

While retiring at 62 is the earliest age when you can claim Social Security, that’s not your “full retirement age” – 67 is generally considered the full retirement age for those born in 1960 or later.

Pre-Retirement Income

Some financial planners suggest that you base your retirement projections on your pre-retirement income. You might use 70%, 75%, or 80% of your current income as a basis for estimating how much money you’ll need in retirement.

For a more detailed look, go through your budget and see how each type of expense will change in retirement. You may need more or less income than you think.

Retirement Lifestyle Goals

Another thing to think about is how your lifestyle overall might change in retirement. Consider whether you plan to move or make other big lifestyle changes that can impact both expenses and taxes. While some costs may go down (such as if you pay off the mortgage on your home), others might go up as you change your lifestyle.

As one example, if you want to explore the world or visit grandchildren, your travel budget may drastically increase from pre-retirement levels.

Social Security

Social Security benefits can provide a vital supplement to your retirement income and help you get closer to financial security. However, it’s critical to understand that the amount of your benefit will vary depending on your age.

The earliest you can start receiving Social Security Benefits is age 62, but your benefits will be reduced by as much as 30% if you take them that early — and they will not increase as you age.

If you wait until your full retirement age (FRA) you can begin receiving full benefits. Your full retirement age is based on the year you were born. For example, if you were born in 1960 or later, your full retirement age is 67. You can find a detailed chart of retirement ages on the Social Security website.

But here is the real Social Security bonus: If you can put off claiming your Social Security benefits until age 70, perhaps by working longer or working part time, the size of your benefits will increase considerably. Typically, for each additional year you wait to claim your benefits up to age 70, your benefits will grow by 8%.

Future Retirement Expenses

Creating an estimated budget can help you get a sense of what your retirement expenses might be. For example, you may know how much you’ll pay for things like housing, utilities, and food. But it’s also important to consider any future expenses that could require you to spend more each month in retirement.

Most people aren’t sure how much money they need to retire, according to SoFi’s retirement survey. Just one quarter of respondents say they know the amount they need.

•   41% have a rough estimate of how much they’ll need to retire comfortably

•   25% know how much they’ll need to retire comfortably

•   25% don’t know how much they’ll need to retire comfortably

Of those who don’t know how much they’ll need for retirement, about 40% are aged 45 or older.

That’s why it’s so important to start thinking now about the expenses you might face in retirement. The sooner you start planning and saving for these costs, the more time — and ideally, the more money — you may be able to stash away.

For instance, healthcare can be a major cost in retirement, especially if you retire early. At age 65, you will qualify for Medicare, but if you retire before then, you’ll need to make sure that you have a plan for covering healthcare costs in retirement. Even after qualifying for Medicare, you may still have significant health-related costs, depending on your specific medical situation. While Medicare can pay for many health-related issues, it doesn’t pay for all of them. Long-term nursing care is a big exclusion.

Purchasing long-term care insurance or a long-term care annuity could provide you with the necessary funds to cover those expenses, should you need nursing care. But if you don’t have either of those options in place, you’ll need to consider how you’ll fit long-term care costs into your retirement budget.

Inflation

Inflation eats away at the value of each individual dollar, including savings and investments, so it’s important to keep in mind the inflation rate for retirement planning. There are several strategies you can use when investing during inflation.

The cost of living in the future will be higher than it is today. For example, if rent costs $1,000 today, but next year inflation rises by 2.5%, that cost could rise to $1,025. Over a decade or more, that price could double or triple.

Closing the Gap Between Current Savings and Your Goal

If you realize that you have a gap between your current savings and where you think you need to be when you retire, it’s important to make a plan to address the gap. If you choose to do nothing, the gap will only grow wider.

You have three main ways to close the gap — either start saving more of your money or find a way to increase the returns your investments are earning. You can also consider making different choices about the sort of retirement you want.

Retirement Savings Accounts

You have many different ways that you can invest and save for retirement. Many employers have 401(k) accounts that give tax advantages for saving for retirement. On top of that, some employers offer matching funds when you contribute to a 401(k) account.

Another option can be to open an IRA, which you can set up on your own.

There are two main types: a traditional IRA and a Roth IRA. While both types let you contribute up to $7,000 yearly for 2025, with an additional catch-up contribution of $1,000 for those age 50 and older, and up to $7,500 for 2026, with an additional catch-up contribution of $1,100 for those 50 and older, one key difference is the way the two accounts are taxed: Traditional IRAs let you deduct your contributions up front and pay taxes on distributions when you retire, whereas Roth IRA contributions are not tax deductible, but you can withdraw money tax-free in retirement.

The Takeaway

It would be nice if there was a simple way to calculate the exact amount you need to retire on. Instead, think of your retirement amount as an ongoing series of calculations that you’ll refine as you get older, and as your thinking gets clearer.

There are some things you can predict, but many that you can’t — including the state of your health (or your spouse’s), the turns the market might take, or a change in priorities. All you can do is start early and save steadily for the retirement you hope to have one day.

Ready to invest for your retirement? It’s easy to get started when you open a traditional or Roth IRA with SoFi. SoFi doesn’t charge commissions, but other fees apply (full fee disclosure here).

Help build your nest egg with a SoFi IRA.

FAQ

How much money do you need to retire with a $100,000 salary?

In order to determine how much money you need to retire with a certain amount of salary, you’ll need to make a few assumptions. For example, you can estimate that you’ll need 75% of your pre-retirement income after you retire and follow the 4% rule. That would mean you’ll need $1,875,000 to be able to retire.

If you change your assumptions, it will also change your numbers. If you follow the 80% rule, for instance, you would aim to replace 80% of your $100,000 pre-retirement income — or $80,000 per year.

How can I catch up on retirement savings if I’m behind?

There are two main ways to catch up on retirement savings if you’re not meeting the targets for where you want to be. The first is to increase the amount of money you’re saving each month. Upping your contributions can help close your retirement savings gap. The other would be to try to increase the investment returns that you are earning, though that may also come with increased risk or volatility.

Should I factor in Social Security when determining how much retirement income I’ll need?

It may not be prudent to count on Social Security as a major contributor to your retirement amount, especially if it’s still decades until your retirement date. Current projections indicate that the government may not be able to fully fund Social Security payments at some point fairly soon — a June 2025 report by the Social Security Board of Trustees indicates that this might happen by 2034. Social Security recipients are still likely to receive benefits, though those benefits may be reduced by around 23%, the report said.

It’s conceivable that Congress could take action to address the shortfall, but that’s impossible to know.

Can you comfortably retire with $1.5 million?

Deciding whether $1.5 million is enough for you to comfortably retire depends a lot on your standard of living and annual retirement expenses. Using the 4% rule says that a nest egg of $1.5 million would give an annual amount of $60,000. Depending on the cost of living in your area and your own standard of living, that may be enough to retire comfortably.

Am I on track to retire comfortably?

To gauge if you are on track with your retirement savings, you can use a couple of general guidelines. The 80% rule says you will need 80% of your pre-retirement income per year when you retire. Another guideline recommends having 10 times your annual salary saved by the time you’re 67.

But you also need to factor in your personal financial situation, as well as your retirement goals to determine if you can retire comfortably. Depending on your circumstances, you may need to save more or less than the guidelines recommend.

---

Photo credit: iStock/Yaroslav Astakhov

SoFi Invest is a trade name used by SoFi Wealth LLC and SoFi Securities LLC offering investment products and services. Robo investing and advisory services are provided by SoFi Wealth LLC, an SEC-registered investment adviser. Brokerage and self-directed investing products offered through SoFi Securities LLC, Member FINRA/SIPC.

For disclosures on SoFi Invest platforms visit SoFi.com/legal. For a full listing of the fees associated with Sofi Invest please view our fee schedule.

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.

Disclaimer: The projections or other information regarding the likelihood of various investment outcomes are hypothetical in nature, do not reflect actual investment results, and are not guarantees of future results.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Third Party Trademarks: Certified Financial Planner Board of Standards Center for Financial Planning, Inc. owns and licenses the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®

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.

SOIN-Q325-044
CN-Q425-3236452-42

Read more