Tips for Finding a Lost Bank Account

With all of the demands on your time, you could lose track of an old bank account. While that might sound outlandish, it can happen to the best of us.

In California alone, there is $9 billion worth of unclaimed property—this includes lost bank accounts, “uncashed checks, insurance policy money, stocks, safe deposit boxes, and other unclaimed cash.”

Sometimes it’s your own account that you’ve forgotten about. Other times it can be an account you inherited after the death of a loved one. Whatever the reason, once you realize you’ve misplaced a bank account, you’ll likely want to track it down.

Finding Old Bank Accounts

If you’ve lost track of money that belongs to you, don’t panic. Here are a few potential ideas for how to find lost money in bank accounts. It might take a little leg work, but finding the unclaimed money due to you can be worth it.

If you’ve accessed the account within the past year, you might be able to recover the account directly from the bank. Exactly how to recover a lost bank account number will likely vary based on the financial institution. Your account information can be found on checks and often on old account statements.

If it’s been longer than a year, you might have to dig a little deeper to recover a lost bank account. The best place to start in a quest for unclaimed property is through your state of residence’s unclaimed property division, usually run through the state treasury department.

Each state will have its own rules and regulations for how individuals should go about proving ownership of the unclaimed money. Most of the time the process starts with filling out an online form. Generally, states will require substantial evidence that the money rightfully belongs to you.

The National Association of Unclaimed Property Administrators operates MissingMoney.com, which is a multi-state directory that allows you to search by name for missing or unclaimed money. You could also search for missing money from a lost bank account on Unclaimed.org , which directs you to your state’s unclaimed property office.

If you belonged to a credit union in the past, it may be worth checking the unclaimed deposits listing run by the National Credit Union Administration.

Depending on the circumstances, you may need to provide proof of your address from decades past. If you’re claiming money on behalf of a deceased relative, you may need more than just a death certificate—sometimes a full probate court order is required. You could check with the local government to confirm the regulations in your state.

Be on the Lookout for Fraud

As you’re searching for lost bank accounts, you may find organizations that offer to find unclaimed money, generally for a fee somewhere between 10% and 20% of the amount recovered. AARP recommends avoiding any services that require payment upfront.

Be wary of any emails or letters you receive offering to return unclaimed property to you for a fee—these are generally scams.

If you encounter an organization or individual who claims to be a part of the government and offers to send you unclaimed money for a fee, these are also generally a scam. Government agencies will not contact individuals about unclaimed money nor will they charge a fee.

If you’re in need of assistance as you search for lost bank accounts, you could consider consulting your financial planner.

Some financial planners offer services to clients to help them look for unclaimed money that may be owed to them. Depending on the financial planner, these services may not even have an additional fee.

Other Sources of Unclaimed Money

Unclaimed money isn’t limited to lost bank accounts. There are a variety of reasons you could be missing money due to you—perhaps you switched jobs and lost track of a pension plan or 401(k). Maybe you forgot to update your address and missed a payment or tax refund.

Pension and Retirement Plans

If you previously worked for a company that offered a pension plan, you can search the Pension Benefit Guaranty Corporation’s unclaimed pension database .

For lost or missing retirement plan funds, you could check the National Registry of Unclaimed Retirement Benefits , which is operated by PenChecks Trust, one of the largest providers of retirement plan distribution services.

Tax Refunds

If you suspect you are owed a missing tax return, you could use the online resource Where’s My Refund? , which is operated by the IRS. To use the tool, you’ll need to know your Social Security number or Individual Taxpayer Identification Number, your filing status, and the exact amount of the refund.

The IRS recommends calling regarding a missing tax refund only when it has been more than 21 days since you e-filed or six weeks since you mailed in your tax return.

If you’re missing a tax return, know you are working on a deadline. You have just three years to claim a missing tax refund before the money becomes the permanent property of the U.S. government.

Rolling the Money Into Another Account

Once you’ve successfully tracked down your lost bank account or other unclaimed money, you might consider choosing a new bank or want to compare the different types of deposit accounts available to you.

Finding the right account for you is a personal choice. One option you could consider is a cash management account like SoFi Money®. SoFi Money offers easy money management and saving all in one.

With SoFi Money®, you’ll have instant access to your accounts anywhere you go. The account allows you to easily track your spending and savings so you can see your cash flow at any given moment.

And if you’re working toward a few savings goals simultaneously, you could set up individual financial vaults for each goal. Plus, there are absolutely no account fees (subject to change) associated with SoFi Money®.

As a SoFi member, you’ll also have access to other member benefits, like career counseling and the opportunity to speak one-on-one with a financial advisor who can help you create a personalized financial plan.

Want to make the most of your recently found money? Find out more about how a SoFi Money® account can help.


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 Money®
SoFi Money is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member FINRA / SIPC .
Neither SoFi nor its affiliates is a bank.

SOMN19087

Read more

How to Save Big with Senior Discounts

From wrinkles to brittle bones, we often hear about the negative aspects of aging. But getting older has its bright side, too. There’s the chance to enjoy travel and hobbies instead of working, and the wisdom that comes from life experience. And of course, there are senior discounts.

When people hear about senior discounts, they might imagine a hunched over person with gray hair hobbling to the local diner with a walker.

But you don’t have to be over 80 to save big. The senior discount age requirement can be as young as 55 or even 50. And the opportunities to economize go far beyond early bird specials, if you know where to look.

Saving money is a welcome proposition for people of any age, but it can be especially important as you get older. That’s because many seniors live on a limited income, whether a pension, Social Security, disability assistance, or distributions from retirement accounts.

At the same time, the cost of living keeps going up because of inflation. And with people living longer on average, retirement savings have to go farther than they ever have. If you’re on the younger side of the “senior” spectrum, every dollar you save can help you put more into your nest egg.

Common Senior Discounts

Here are some tips on the kinds of discounts out there and where to look for them:

Travel

Exploring the world is something many people look forward to in their retirement years. Good news—lots of senior citizen discounts apply when it comes to travel. Airlines such as American Airlines, Southwest, United, and Delta offer lower fares for older passengers for some destinations and markets.

Your best bet is to call the airlines directly to check for available deals. British Airways also offers discounts on flights and vacation packages for members of AARP, which anyone aged 50 and over can join .

Members of AARP also get discounts on car rentals with Budget Rent A Car (10-30% off), Avis (10-30% off), Zipcar (43% discount on membership), and Payless Car Rental (discount of 5% and up).

Hertz separately offers discounts of up to 20% to travelers who are 50 or older, and Alamo provides deals through its Senior Circle program. If you prefer to travel by bus or train, Amtrak gives 15% off on most domestic trains to riders 62 and older and 10% off on cross-border trains to travelers 60 and over. Passengers who are 62 and over can also ask for 5% off on Greyhound bus trips.

Seniors can also save on many cruises. Royal Caribbean and Carnival offers special rates on certain routes for those 55 and older. AARP members can also get deals with river cruises through Uniworld, Collette, and Grand European Travel, as well as Caribbean cruises with MSC.

Hotels are another way older customers can pay less for travel. Best Western offers up to 15% off for guests 55 and up. Motel 6 and Choice Hotels give 10% off to those 60 and older, and Hampton Inn gives the same to guests 65 and older (or AARP members). Marriott offers at least 15% off to those 62 and older, and IHG gives an undisclosed deal to those in the same cohort.

AARP members also get 10% off at Wyndham Hotels and Resorts, which includes Super 8, Days Inn, and La Quinta. Plus, they get 10% off at Ramada Worldwide, Comfort Inn, and Cambria Hotels, as well as 5% off at Hilton Hotels and Resorts.

Seniors can also save while traveling closer to home. Many city transit systems offer free or reduced fares for older residents.

San Francisco’s Muni system is free for riders 65 and older who meet income limits. Chicago, New York, Washington, D.C., and many other cities also offer lower fares to older passengers.

Shopping

As a senior, you can also save big with many retailers. Clothing stores that offer discounts to older shoppers include Belk, Goodwill, Kohl’s, Ross and Christopher & Banks.

In some cases, discounts only apply on certain days. Beyond apparel, seniors can get discounts on purchases at craft stores, including Michaels and Joann, and grocery stores like Bi-Lo and Bealls.

AARP members also get deals with UPS, LensCrafters, and various flower delivery services. Walgreens gives seniors 55 or older up to 20% off on the first Tuesday of the month, or anytime for AARP members.

Rite Aid does the same (except for prescriptions) on the first Wednesday of the month to those 65 and older. Don’t forget to check for discounts with local stores, as well — they’re not always advertised.

Eating Out

Seniors can eat for less at a variety of restaurants, sometimes on specific days. The exact age when the benefit kicks in and the type of discount can vary, but the average is around 10% . Popular chains such as A&W, Applebee’s, Ben & Jerry’s, Chili’s, and Shoney’s offer 10% off at most locations.

The perks at Chili’s, Dairy Queen, IHOP, TCBY, and Whataburger kick in at age 55 , and Krispy Kreme and Steak ‘n Shake offer discounts to customers as young as 50.

Other restaurants — including Bubba Gump Shrimp Co., Dunkin Donuts, and Denny’s — give 10% off to members of AARP . Places like Arby’s, Back Yard Burgers, Dairy Queen, KFC, McDonald’s, and Taco Bell throw in a free soft drink or coffee for seniors.

Keep in mind that discounts might vary by location at restaurants that are franchises. And make sure you’re clear on what the discount includes (many don’t cover alcohol, for example). Don’t feel like you have to limit yourself to the big chains—many local restaurants also offer discounts or early bird specials.

Recreation

There are lots of ways to save as a senior in your leisure time. Many movie theaters, including AMC, Cinemark, Landmark Theatres and Showcase Cinemas, offer discounts, with some only applying for certain days or times.

Adults age 62 and older can enjoy the great outdoors for less with a Senior Pass that will get them into more than 2,000 national parks and other recreational sites overseen by six federal agencies.

The pass, which costs $20 for a year or $80 for a lifetime, may also include discounts on camping, swimming, and boat launch fees.

Museums are another place that offer reduced fares for seniors, including the Metropolitan Museum of Art in New York, the Art Institute of Chicago, and the Natural History Museum of Los Angeles. Zoos, such as the Bronx Zoo, and gyms are also places seniors can enjoy for less.

Services

Senior discounts extend the necessities of life, too. AT&T, T-Mobile, and Verizon all offer deals on monthly phone plans for older subscribers. Jiffy Lube, as well as some regional auto repair providers, offers savings to seniors at some locations.

Certain utility providers also give discounts to older residents on things like garbage collection, water, and power; income limits are sometimes a prerequisite. Some car insurance companies also slash premiums for older riders, and Great Clips and Supercuts offer cheaper haircuts to seniors at some locations.

Saving the Smart Way with SoFi Money

Senior discounts can be a great way to cut your expenses, but having more in the bank is just as helpful when it comes to achieving your goals. Opening a cash management account with SoFi Money®, where you can spend, save, and earn all in one place, could be an easy way to put your cash to work for you.

There are no account fees (subject to change) and you can use your phone to make deposits or transfers, and you can send money instantly to other SoFi Money customers. It takes just minutes to open an account online.

Making the Most of Your Golden Years

Every penny counts when you’re a senior. Saving big through senior discounts—and earning as much as possible in your accounts—means more of your hard-earned retirement income stays in your pocket. So you can use the cash for what you really want to do in your golden years.

Want to keep your cash in place that pays? Open a cash management account with SoFi Money today.


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 Brand Mentions: No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third party trademarks referenced herein are property of their respective owners.
SoFi Money®
SoFi Money is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member FINRA / SIPC .
Neither SoFi nor its affiliates is a bank.

SOMN19013

Read more

How to Know When to Sell a Stock

Whether on TV, on the radio, or from your third cousin at the Thanksgiving dinner table, there is a lot of chatter dedicated to the discussion of which stocks are hot buys.

For many investors, buying and researching what stocks to buy is fun and interesting. Others are lured in by the chance to pick the next big winner.

The desire to identify a great stock pick taps into our human nature. We love to talk about what investments to integrate into our portfolios in the hope we turn a profit.

Conversely, our human nature can sometimes make it difficult for us to let go of a stock, whether that stock has done poorly or it has been on a ship to the moon.

You’ve probably noticed, but there isn’t a lot of discussion over the airways on the decision of when to sell a stock. This could be because it can feel like a tricky decision to make. And the decision isn’t easier whether that stock has done really great or if it has been a total dud.

Here are some ideas you could keep in mind if you own stock and are wondering when to sell a stock for profit or when to sell a stock at a loss.

Why Selling Stock Is Hard

If you’re having a difficult time making a decision about whether to sell a stock, you’re not alone. This decision can tap into a lot of different human emotions.

For example, humans can experience something called loss aversion, where they have a physical reaction to the thought of losing money.

The thought of selling stocks at a loss can trigger this emotion, and it can make it hard to sell even when a person logically understands that the money could be better used in another stock or investment. We may want to hold onto that investment, hoping that it improves.

On the flip side, knowing when to sell a stock at a gain can be equally as difficult. After a stock has a precipitous rise, it can be tough to sell because the inclination is to believe that the stock may continue to rise.

This feeling could be exasperated by hubris, the feeling that it was because of your intelligence that the stock has done so well, or good old-fashioned greed (which is a totally natural reaction).

Beyond the ways our brains are working against us, there is no universal protocol for selling stocks. There are no rules for making a good decision.

And often, there is no one right answer, because knowing how a stock will move forward requires knowing what will happen in the future. Good luck with that.

Trying to Time the Market

Before discussing valid reasons you may want to sell a stock, let’s talk about what might not be a good reason to sell a stock: Making a knee-jerk reaction to the recent performance of that stock.

This can be classified as attempting to time the market. Even the experts cannot always buy at the bottom and sell at the top. Know that there is no perfect equation and that it is not science.

It can be tempting to sell a stock based on a big dip or bump in price, but the recent price movement alone might not give a complete picture of the current value of a stock.

It may help to remember that a stock is something that trades in an open marketplace and that prices shift due to the buying and selling of these stocks.

This is especially the case in the short term. Therefore, price changes may have as much to do with investor sentiment or outside forces (such as geopolitical or economic events or announcements) as they do with the health of the underlying company.

When You Might Sell a Stock

There are several reasons you might want to consider selling a stock. If you’re currently in this position, you may want to weigh several of these ideas against one another.

Please note that none of these methods amount to a recommendation, but are ways to think about the same decision from within different frameworks.

1. When You No Longer Believe in the Company

When you bought the stock, you presumably did so because you believed that the company was promising and/or that the price was reasonable.

If you were to believe that the underlying fundamentals of the business were in decline, it might be time to sell the stock and reinvest those funds in a company with a better outlook.

Most businesses won’t last, or be successful, forever. That’s simply the nature of running a business. There are many reasons you may lose faith in a company’s underlying fundamentals.

For example, the company may have declining profit margins or decreasing revenue, increased competition, new leadership taking the company in a different direction, or legal problems, among other things.

Part of the trick here is differentiating what might be a short-term blip in the stock price due to a bad quarter or even a bad year and what feels like it could be the start of a more sustained change within the business.

2. Opportunity Cost

Every decision you make comes at the cost of some other decision you can’t make. When you spend your money on one thing, the tradeoff is that you cannot spend that money on something else.

Same goes for investing—for each stock you buy, you are doing so at the cost of not holding some other stock.
No matter the performance of the stock you’re currently holding, it might be worth evaluating to see if there could be a more profitable way to deploy those same dollars.

This is easier said than done because we are emotionally invested in the stocks that we’ve already purchased. It may be a good idea to try and be as objective as possible during the evaluation and re-evaluation processes.

3. The Valuation Is High

Oftentimes, stocks are looked at in terms of their price-to-earnings (P/E) ratio. The market price per share is on the top of the equation, and on the bottom of the equation is the earnings per share. This ratio allows investors to make an apples-to-apples comparison of the relative earnings at different companies.

The higher the number, the higher the price as compared to the earnings of that company. A P/E ratio alone might not tell you whether a stock is going to do well or poorly in the future.

But when paired with other data, such as historical ratios for that same stock, or the earnings multiples of their competitors, it may be an indicator that the stock is currently overpriced and that it may be time to sell the stock.

A P/E ratio could increase due to one of two reasons. First, because the price has increased without a corresponding increase in the expected earnings for that company.

And two, because the earnings expectations have been lowered without a corresponding decrease in the price of the stock. Either of these scenarios tells us that there could be trouble for the stock on the horizon, though nothing’s a sure bet.

4. Personal Reasons

Though not an analytical reason to sell, it is possible that you may need to sell a stock for personal reasons, such as needing the money for living expenses. If this is the case, you may want to consider a number of factors in choosing which stock to sell.

You may make the decision based purely off of which stocks you feel have the worst forward-looking prospect for growth while keeping those that you feel have a better outlook. Or, you may make the decision based on tax reasons.

5. Taxes

The ubiquitous saying goes, “don’t let the tax tail wag the investment dog,” meaning that tax strategy shouldn’t outweigh making decisions based on investment principles. Still, some people may take the rules of taxation into account when making decisions about which stocks to keep and which stocks to sell.

When purchased outside of a retirement account, gains on the sale of an investment like stock are subject to capital gains tax.

It may be possible to offset some capital gains with capital losses, which are acquired by selling stocks at a loss. If you’re considering this strategy, you may want to consult a tax professional.

Alternative Solutions

If making the decision about when to sell a stock is causing you to lose sleep or is something you don’t feel ready for, it may be time to consult the help of a professional or seek out investment strategies that don’t require making such a decision.

To hire the help of a professional, you might want to bring someone on who will act as your fiduciary.
Fiduciaries are required by law to make recommendations in the client’s best interest. A fiduciary could be an individual, a financial planning firm, or an online investment service and platform like the one offered by SoFi.

With SoFi Invest®, you have the opportunity to choose between two investing methods. The first, SoFi Active Investing, is a platform that allows you to actively buy, sell, and trade stocks online and other investments, like exchange-traded funds (ETFs).

But if making that decision about when to sell stocks (and when to buy them) is something you are looking to get away from, SoFi Automated Investing may be more your style.

With Automated Investing, SoFi builds an investment portfolio of ETFs using your goals, risk tolerance, and investing time horizon as a guide.

SoFi manages both the short-term and long-term upkeep of the portfolio, including making shifts to your strategy as your goals change. With this service, you’ll never have to make a decision regarding the management of your portfolio.

Best of all, this management service is provided at no cost to you. Whether or not you opt for using an automated investment service (also known as a robo-advisor), using funds may be a helpful solution to the problem of when to sell a stock. Funds, whether they be mutual funds or ETFs, generally hold many other investments.

For example, an S&P 500 mutual fund (or ETF) holds all 500 companies held in the S&P 500 index. With the purchase of just this one fund, you are actually buying into the 500 stocks that are currently measured by the S&P 500 index.

In this way, many funds are already diversified investment holdings. For many people, they may be a solid strategy for long-term investing.

With a fund-based buy and hold strategy, you could largely avoid the decisions involved in managing a portfolio of stocks, such as when to sell stocks and when to hold onto them.

When choosing funds, you might want to consider the composition (what types of stocks are held within the fund) and the fees involved with owning the fund.

Also, you may want to differentiate between index funds and managed funds. Index funds mimic some particular part of the overall stock market and don’t involve an active manager.

Just as it sounds, managed funds have an active manager making decisions about what stocks are held within the funds. Managed funds are typically more expensive than index funds, so be sure to make sure the fee is worth it.
There’s no doubt about it, managing a portfolio of stocks can feel like a full-time job. What to buy and when to sell at a loss or when to sell for a profit might all be considerations on an ongoing basis.

Investment portfolios require upkeep, and so either an investor does it or they hire someone or a service to do it for them. Ultimately, it will be up to the investor to decide which of these makes sense for them.

Ready to have an investment portfolio that is fully managed for you? Check out SoFi Invest.


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.
Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.
Investment Risk: Diversification can help reduce some investment risk. It cannot guarantee profit, or fully protect in a down market.
SoFi Invest®
The information provided is not meant to provide investment or financial advice. Investment decisions should be based on an individual’s specific financial needs, goals and risk profile. SoFi can’t guarantee future financial performance. Advisory services offered through SoFi Wealth, LLC. SoFi Securities, LLC, member FINRA / SIPC . The umbrella term “SoFi Invest” refers to the three investment and trading platforms operated by Social Finance, Inc. and its affiliates (described below). Individual customer accounts may be subject to the terms applicable to one or more of the platforms below.

SOIN19127

Read more

Investing for Beginners: Basic Strategies to Know

As an investor, you are unique. And as you start building your portfolio, there are many strategies you can draw upon to help you achieve your personal financial objectives. Which you choose will depend on your needs and the goals you are trying to accomplish.

Choosing an Investment Strategy

Say you’re in the market for a new pair of shoes. You’ll likely want to choose something that will last a long time, is a comfortable fit, and doesn’t leave you wondering whether you made a mistake when you bought them.
The shoes should also fit your individual needs—are they for long-distance running, for work, for going out at night?

In many ways, choosing an investment strategy is like shopping for the right pair of shoes. You need one that fits your personal goals, whether those goals are saving for a down payment on a house, a child’s education, or retirement.

And you need a strategy that will be comfortable for you to pursue in the long-term. You don’t want to be tempted to switch strategies frequently, potentially upending your financial plan.

Ultimately, the best strategy (or mix of strategies) is the one that works for you. Here’s a look at some of the fundamental strategies that you may want to consider as you start to build out your investment portfolio for the first time.

Strategies for Building a Portfolio

Asset Allocation

An investment strategy that splits a portfolio among asset classes—including stocks, bonds, and cash—asset allocation helps strike a balance between investment risks and returns.

Each of the assets classes above behaves differently under different market circumstances, which means each has its own risk and return profile. For example, stocks tend to offer the potential for the highest returns. They can also be volatile, which means in addition to high highs, they may experience low lows.

Cash, on the other hand, tends to be extremely stable. The money in your savings account isn’t likely to go anywhere and might even be insured by the federal government.

Yet, the trade-off for that stability is the fact that savings accounts or other cash equivalents, such as certificates of deposit, offer relatively low returns, typically between 0.01% and 3% APY.

The proportion of each asset class that investors hold is related to their personal goals, time horizon, and risk tolerance. Time horizon is the amount of time an investor has to invest before they achieve their goals, and risk tolerance is an investor’s willingness to lose some of an investment in exchange for potentially greater long-term returns.

Asset allocation might shift over time. An investor in their 20s saving for retirement might have a portfolio made up of mostly stocks. Stocks could offer the greatest potential returns, and with 40 years before the investor might need the money, they may have plenty of time to ride out any downturns in the stock market.

A person who has already retired and needs much more immediate access to their cash may hold more fixed-income investments, like bonds, which are less volatile and therefore less likely to experience hard downturns at the time the investor needs them.

Diversification

One way to manage risks in a portfolio is through diversification, building a portfolio with a broad mix of investments across assets. Essentially, diversification can help investors avoid putting all their eggs in one basket.

Imagine for a moment a portfolio invested in just one oil stock. If the price of oil goes down, the entire portfolio suffers.

Now imagine a portfolio that holds stocks from all sectors, in companies of all sizes from all around the world. Not only that, but the portfolio holds a variety of bonds and even other investments like real estate.

Similar to asset allocation, the idea here is that these different investments will behave differently during changing market conditions. For example, U.S. stocks may not perform the same as European stocks, and energy stocks may not perform the same as medical company stocks.

With a diversified portfolio, as market condition changes—such as a drop in the price of oil—one group of investments may suffer while another may not, thereby spreading out risk.

Rebalancing

Your portfolio can change over time. During a bull market, you may find your stocks are performing well and that they now make up a much greater portion of your portfolio than they did before.

Remember that your portfolio is balanced based on your personal goals, time horizon, and risk tolerance. So when there is a shift in holdings, investors may want to buy or sell assets to bring their portfolio back in line with their planned asset allocation.

Strategies for Buying and Selling

Tax Efficiency

Tax efficiency is a measure of how much of your return stays with you and how much ends up going to the government. Keeping an eye on taxes can be an important part of maximizing your investment returns.

The first step in building a tax-efficient portfolio is to understand where the investments—whether in taxable, tax-deferred, or tax-free accounts—will be held. Taxable accounts include brokerage accounts, and income from these accounts may be subject to long- and short-term capital gains tax and other taxes.

Long-term capital gains tax is a tax treatment applied to investments that have been held for a year or more. Short-term capital gains tax is applied to investments that are held for less than a year and are pegged to an investor’s tax bracket.

Investors looking to minimize their taxes might want to hold on to investments for more than a year to be subject to the longer long-term capital gains rates.

Tax-deferred accounts, such as 401(k)s and traditional IRAs, allow investments to grow tax-free as long as they remain in the account. Investors fund these accounts with pre-tax dollars, and withdrawals made after age 59½ are subject to regular income tax.

Tax-free accounts, such as Roth 401(k)s and Roth IRAs, are funded with after-tax dollars, but investments inside the account then grow tax-free. When investors make qualified withdrawals from these accounts, they pay no additional taxes.

As a general rule of thumb, tax-efficient investments, such as regular stocks, may be held in a taxable account, while investors may want to hold inefficient investments, such as taxable bonds, in accounts that have preferential tax treatment.

Dollar-Cost Averaging

Dollar-cost averaging is a process by which investors invest on a regular basis, making purchases regardless of price. For example, an investor might choose to invest $100 a month in an index fund that tracks the S&P 500.

The share price for that fund will likely vary from month to month, though the amount of money the investor uses to buy shares does not. By design the investor buys fewer stocks when they are priced high and more when they are priced low.

This strategy might help investors mitigate buying high and selling low. And because investment is done on a regular schedule with a set amount of money, this strategy is one way for investors to avoid emotional investing.

Buy and hold

Investors who choose to use a buy and hold strategy will typically buy stocks and hang on to them for the long term, regardless of short-term market movement. Buy and hold investors believe that they will achieve some kind of return in the future despite fluctuations in the market on a short-term basis.

Fluctuations in the market are a normal occurrence, but investors may still get nervous and want to sell their stocks at the first sign of a downturn.

However, this tendency can work against investors, as selling a stock locks in any losses they may have experienced and means they could miss out on any subsequent rebound in price. A buy and hold strategy might help curb this tendency.

What’s more, the buy and hold strategy could help investors minimize fees associated with trading, which might help boost the overall return of the portfolio.

Strategies for Picking Stocks

Fundamental analysis

Fundamental analysis is a strategy that can help investors choose specific stocks to buy. When practicing fundamental analysis, investors look at public data like financial statements, revenue, earnings, future growth, and profit margins as well as broader economic factors when choosing a stock.

Fundamental analysis attempts to look at everything that affects a security’s value, including macroeconomic factors like overall market conditions and industry conditions and microeconomic factors such as company management.

Investors hope that a thorough examination of these factors can help them arrive at an intrinsic value for the stock. The price at which the stock is actually trading may be above or below this value, and by comparing this value with the current price, investors could determine whether or not it’s a good time to buy.

Technical Analysis

Unlike fundamental analysis, technical analysis does not try to identify an intrinsic value of a particular investment. Technical analysts believe that a stock’s fundamentals are already factored into the price of the stock so do not require individual attention.

So, when using this strategy, investors try to identify good investments by looking at statistical trends. For example, investors may look at factors such as price movement and trading volume. By identifying patterns and current trends, investors hope to be able to predict future patterns and trends.

Value investing

Value investing is a strategy that makes use of fundamental analysis. The basic idea behind this style of investing is that investors only buy stocks that are priced lower than their actual value and hold onto them for the long-term, or at least until they rise above the investor’s price target.

In other words, these investors are looking to buy stocks that are mispriced or priced at a “discount.” If an investor buys a stock at a lower price than they believe it is actually worth, chances may be good that the price of the stock will rise before the investor sells it.

Before buying any asset, investors should be sure to do their due diligence, learning as much about it as they can. In some cases, investors can lean on the expertise of others. Rather than try to identify values of stocks themselves, investors can buy mutual funds, index funds, or exchange-traded funds (ETFs) that hold value stocks that have already been identified by professional fund managers.

Growth investing

While value investors are looking for stocks that are priced less than they are worth, growth stock investors put much less emphasis on the current price.

They are focused on stocks that are likely to increase in value in the future, more so than other stocks in their industry or the market as a whole.

Growth investors tend to focus on young companies that have a lot of growth potential, companies in quickly expanding industries, and those that make use of new technologies and services.

There is no real formula for what to look for when identifying growth stocks. However, investors looking for growth opportunities might want to look at companies that have strong historical earnings growth in the recent past. Investors might also look at forward earnings growth.

Publicly traded stocks must make earnings announcements on a regular basis, and analysts will make earnings estimates shortly before these announcements are made. These numbers can help analysts approximate the fair value for the company.

Once again, investors can leave the analysis up to professionals and may choose to invest in mutual funds, index funds, or ETFs that invest in growth stocks. Investors interested in taking a hands-off approach through investing in funds may consider an automated investing account to help them build a portfolio.

Monitoring Your Portfolio

Your life is not static, and your goals and financial needs will change. For example, you may change careers, get married, have children, decide to retire early or decide you want to work longer than you had planned. Each of these milestones can affect your goals and how much money you need to save.

You could consider SoFi Invest®, which lets you invest however you feel most comfortable, whether that’s hands-on with active investing or letting automated investing do the work for you.

With SoFi Invest, there are no transaction or management fees, and you can speak to a financial advisor at no charge.

Ready to learn more about investment strategies and how to begin investing? Visit SoFi Invest today.


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.
Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.
SoFi Invest®
The information provided is not meant to provide investment or financial advice. Investment decisions should be based on an individual’s specific financial needs, goals and risk profile. SoFi can’t guarantee future financial performance. Advisory services offered through SoFi Wealth, LLC. SoFi Securities, LLC, member FINRA / SIPC . The umbrella term “SoFi Invest” refers to the three investment and trading platforms operated by Social Finance, Inc. and its affiliates (described below). Individual customer accounts may be subject to the terms applicable to one or more of the platforms below.

SOIN19126

Read more

Bank Accounts for College Students

College students most likely want to make smart choices when it comes to money management in order to set themselves up for future financial success.

A favorable account for college students typically depends on personal financial needs, but the bank itself might be beneficial in more ways than imaginable.

While specific student bank accounts do exist, a beneficial account for any student will be the one that benefits them and their money the most.

How Do I Choose a Bank?

There are four main factors that might be helpful to research when choosing a new bank: fees, interest rates, location, and online access.

Something students may want to avoid is a bank that charges monthly fees for student or traditional checking accounts or requires a minimum deposit to open a new account.

Another fee to watch for is the overdraft fee, which currently averages just over $33 . For students who may not keep a lot of money in a checking account, an overdraft fee could end up being more than the total account balance.

One type of fee that might be forgotten until monthly reconciliation time is the ATM fee. Somesome banks and financial institutions will refund up to a certain amount (or sometimes all) of ATM fees each month when using another bank’s machine to withdraw cash.

If the evening’s entertainment is somewhere that only accepts cash, having an easy option to access funds could mean the difference between having fun with friends or having to sit the night out.

College students might also want to consider researching interest rates. If building up a savings account for post-college expenses or loan payments is a priority, it could be helpful to look into a bank that offers high-yield savings accounts, which typically earn a higher interest rate than checking accounts.

College location might be one of the biggest determining factors when looking for a bank. For students attending college away from home, researching banks near campus may turn up some convenient options.

Many banks and credit unions have local branches. Having an ATM nearby might also be an important factor to consider.

Some colleges may offer an on-campus bank branch or a few ATMs. Choosing a well-known bank with locations across the country may offer an advantage to being able to find a physical branch, but if that isn’t an important factor, considering which banks are near campus could be an alternative.

Another piece of the puzzle, and one that some students might seek for convenience, is online banking. Especially when choosing a bank that does not have a location near school, making sure the bank’s app or website is up to snuff could make banking transactions that much more convenient.

Some banks may offer mobile check deposit through an app, which could mean even fewer trips to a physical bank branch.

How Many Bank Accounts Should I Have?

Learning to manage money is part of becoming an adult. College students are most likely living on their own for the first time and might have little to no experience opening and using a bank account.

Having just one checking and one savings account might simplify keeping track of funds earmarked for spending and those meant for savings.

For students interested in saving for longer-term goals—maybe tucking money away for future student loan payments or emergency funds—opening another savings account could be one strategy to help reduce the temptation to think of that as available, spendable money.

Having too many accounts could become a problem if keeping track of those separate accounts becomes too much to handle on top of an already busy school schedule.

What Kind of Account Works For College Students?

Besides looking into which financial institution might work well for college students, something else to consider might be the type of institution to do business with.

Credit unions, for instance, tend to be smaller but still offer many of the same services as a big bank. They may also offer more flexibility and lower fees.

As nonprofits, credit unions are designed to serve their members, and typically pay higher interest rates on deposits and offer a more personalized experience and better customer service.

If you don’t need a brick-and-mortar bank location every two blocks, a credit union could be the right fit for college. Some credit unions also offer online and mobile banking options.

Plus, if you are using a credit union savings account, odds are you will earn higher interest, and avoid some of those other larger bank fees along the way.

Though some bigger financial institutions do offer special, college student-only accounts with lower fees or certain bonuses to help maintain a healthy budget as well.

A money management account could be another option to amp up savings and avoid fees. SoFi Money® is a cash management account that enables members to spend, save, and earn an interest rate all in one place without paying account fees.

Funds can be managed and accessed from anywhere—complete with mobile transfers, photo check deposit, and customer service available through the app.

College students looking for a flexible money management experience might find SoFi Money® to be the right option. Learn more.


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 Money®
SoFi Money is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member FINRA / SIPC .
Neither SoFi nor its affiliates is a bank.

SOMN19082

Read more
TLS 1.2 Encrypted
Equal Housing Lender