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Typically, you can’t write checks from a savings account. Instead, you can do so from a checking account, which is designed to provide that specific financial service. Savings accounts are primarily for earning interest on your deposits and only occasionally transferring money.

Checks might seem like an old-fashioned payment method, but they can be vital in specific transactions. For instance, you might need to pay the deposit for an apartment rental by check. In addition, personal checks are more secure for mailing payments than cash. While you may want to draw funds from a savings account by check, that’s really not what it’s designed for.

Why You Can’t Write Checks from a Savings Account

You can’t usually write checks from a savings account because these accounts are for earning interest on cash you leave alone. What’s more, you may be restricted as to how often you can transfer money out of a savings account, too.

Part of the way a bank makes money is to lend out your funds on deposit in a savings account for other purposes. You earn an annual percentage yield, or APY, on your deposit for giving the bank the privilege of using your money that’s in a savings account. (You can use an online APY calculator to take a closer look at this figure.) In other words, your financial institution is depending on some savings account money staying put, not being regularly transferred out via checks.

Checking accounts, however, are designed to allow customers to write checks and make purchases. They may not make much or any interest, but you can move your money out of these accounts via checks and electronic transfers. You can even write a check to yourself to access your money.

What Accounts Can You Write a Check From?

One of the ways that checking accounts vs. savings accounts differ is that you usually can’t write checks from a savings account. However, both checking accounts and money market accounts can let you move funds out via checks. You can choose from the following types:

•   Standard checking. This account typically provides a checkbook and debit card to make purchases. You might earn meager or no interest, but you can access your cash quickly. And, as with most kinds of checking accounts, you’ll be able to get cashier’s checks and certified checks if needed.

•   Premium checking. This is a checking account on steroids, with better interest rates, rewards programs, and customer perks. In addition, these accounts might have monthly fees or steep minimum balance requirements in order to get those enhanced benefits, so check your customer agreement carefully.

•   Rewards checking. Think of rewards checking as akin to a premium checking account but focuses on providing cash back for debit card usage. Again, it’s crucial to read the fine print for these accounts, as they usually require specific spending habits to be worthwhile.

•   High-interest checking. This kind of account, also known as high-yield checking, blends saving and checking together by providing higher interest rates while allowing you to write checks and use your debit card.

While this account attempts to provide the best of both worlds, you’ll likely receive a lower interest rate than a savings account. You also might have to fulfill strict requirements (such as a monthly high account balance or transaction count), though some banks, especially online banks, may offer them without fees or balance requirements.

•   Student checking. High school and college students can access banking through these accounts. Student checking accounts typically provide leniency for overdrafts and promotional rewards for new customers. However, your account will change to a standard checking account when you lose student status, meaning you may lose the advantages of a student account.

•   Second chance checking. Customers with less than perfect banking histories can struggle to find a bank that will provide them with an account. Unpaid bank fees and repeated overdrafts can cast a shadow over your banking record, making financial institutions hesitant to work with you. Fortunately, numerous institutions offer second chance checking to give customers another shot at banking. These accounts might restrict spending or charge monthly fees to cover their risk but can help you get back on your feet.

•   Money market account. Many money market accounts also combine some of the features of savings and checking accounts. For example, money market accounts can earn higher interest than typical checking accounts (making them more like savings accounts) but allow you to write checks, as with a checking account.

Recommended: How to Sign Over a Check to Someone Else

What You Can Do With a Savings Account

While you may not be able to write checks with a savings account, the different types of savings accounts offer these functions and benefits:

•   Security. You can safely save for the future, whether that means building an emergency fund or saving for a down payment on a house. If you bank at a Federal Deposit Insurance Corporation (FDIC)- or National Credit Union Administration (NCUA)-insured institution, you will have up to $250,000 per depositor or shareholder, per insured institution for each account ownership category.

•   Interest. As noted above, you’ll earn interest. The annual percentage yield (APY) will help your money grow.

•   Convenience. You can also use mobile banking with a savings account. This feature allows you to access your account from your phone to deposit checks, transfer money, and view monthly statements.

•   Perks. You may be able to snag some perks by opening a savings account, such as some banking fees being waived or a one-time cash bonus.

•   Automated savings. You can set up automatic transfers from your checking account to savings to help increase your savings in an effortless way.

•   Account linking. You can link your savings account as a backup to your checking to help avoid overdrafting.

Quick Money Tip: If you’re saving for a short-term goal — whether it’s a vacation, a wedding, or the down payment on a house — consider opening a high-yield savings account. The higher APY that you’ll earn will help your money grow faster, but the funds stay liquid, so they are easy to access when you reach your goal.

Tips for Using a Savings Account to Make Payments

Here’s how to set up automatic transfers out of your savings account:

•   Have your account details handy. Double-check your account and routing numbers to make sure you are transferring funds out of the right account.

•   Limit the bills you pay with your savings account. The less information is out there, the less likely it is to fall into a thief’s hands.

•   Don’t attempt more than your account’s transaction limit. Some savings accounts may allow no more than six withdrawals per month. Check with your financial institution to find out your exact transaction limits.

•   Maintain an adequate balance. Transferring money from your checking account and depositing cash or paychecks into your savings account will help ensure you don’t overdraft the account.

The Takeaway

Savings accounts are excellent tools for earning interest and working towards your financial goals. However, they are less suitable for making payments because you typically can’t write checks from a savings account. However, you can usually make payments from savings accounts by automatic transfers.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with eligible direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy 3.30% APY on SoFi Checking and Savings with eligible direct deposit.

FAQ

Why do checks come from checking accounts?

Checks come from checking accounts because banks intend payments to flow frequently from these accounts. In addition, checking accounts are the most convenient way to deposit and withdraw money from a bank because you can withdraw money an unlimited amount of times per month.

Why can I not write checks with a savings account?

In general, you can’t write checks with a savings account because the account is for saving money and earning interest payments. Banks don’t provide checks for a savings account because the intention is for you to save money and leave at least a chunk of it untouched in the account. On the other hand, checking accounts allow you to write checks.

Can I write any check from a savings account?

You typically can’t write a check from a savings account because that is not how they operate according to federal guidelines. You can save money and earn interest with a savings account, while a checking account allows you to write checks.

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SoFi Checking and Savings is offered through SoFi Bank, N.A. Member FDIC. The SoFi® Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

Annual percentage yield (APY) is variable and subject to change at any time. Rates are current as of 12/23/25. There is no minimum balance requirement. Fees may reduce earnings. Additional rates and information can be found at https://www.sofi.com/legal/banking-rate-sheet

Eligible Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Eligible Direct Deposit”) via the Automated Clearing House (“ACH”) Network every 31 calendar days.

Although we do our best to recognize all Eligible Direct Deposits, a small number of employers, payroll providers, benefits providers, or government agencies do not designate payments as direct deposit. To ensure you're earning the APY for account holders with Eligible Direct Deposit, we encourage you to check your APY Details page the day after your Eligible Direct Deposit posts to your SoFi account. If your APY is not showing as the APY for account holders with Eligible Direct Deposit, contact us at 855-456-7634 with the details of your Eligible Direct Deposit. As long as SoFi Bank can validate those details, you will start earning the APY for account holders with Eligible Direct Deposit from the date you contact SoFi for the next 31 calendar days. You will also be eligible for the APY for account holders with Eligible Direct Deposit on future Eligible Direct Deposits, as long as SoFi Bank can validate them.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, Wise, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi Bank shall, in its sole discretion, assess each account holder's Eligible Direct Deposit activity to determine the applicability of rates and may request additional documentation for verification of eligibility.

See additional details at https://www.sofi.com/legal/banking-rate-sheet.
*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.

We do not charge any account, service or maintenance fees for SoFi Checking and Savings. We do charge a transaction fee to process each outgoing wire transfer. SoFi does not charge a fee for incoming wire transfers, however the sending bank may charge a fee. Our fee policy is subject to change at any time. See the SoFi Bank Fee Sheet for details at sofi.com/legal/banking-fees/.
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 content is provided for informational and educational purposes only and should not be construed as financial 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®

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Editor's Note: Options are not suitable for all investors. Options involve risks, including substantial risk of loss and the possibility an investor may lose the entire amount invested in a short period of time. Please see the Characteristics and Risks of Standardized Options.

Investors in stock option contracts have the right to buy or sell underlying stocks (or other assets) at a predetermined price within a certain time period. When an investor decides they want to take action on their right to buy or sell, it’s called exercising. There are a number of ways investors can choose to exercise their options contract, depending on their individual goals and financial situation.

Option contracts are complex investment vehicles. They’re a multi-faceted tool that involves precise timing and strategizing. While options are not for all investors, if handled by experienced traders, options could be beneficial for those who understand the risks involved.

What Does Exercise Mean in Options Trading?

Exercising a stock option means that a trader purchases or sells the underlying stock associated with the options contract at the price set by the contract, which is called the strike price. This price may differ from the current market price of the stock.

Options contracts are valid for a certain amount of time in options trading. So if the owner doesn’t exercise their right to buy or sell within that period, the contract expires worthless, and the owner loses the right to buy or sell the underlying security at the strike price.

There is also an upfront fee in options trading, called a premium, that gets paid when a trader enters into an options contract. If the trader doesn’t exercise the contract, they forfeit that fee along with any other brokerage fees. Most options contracts never get exercised. Some contracts are sold instead of exercised, because the contract itself has value if it has the potential to be exercised later.

There are two main choices of types of options contracts, call options and put options. Purchasing a call option gives the buyer the right, but not the obligation, to purchase the underlying security at the strike price. Purchasing a put option gives the buyer the right, but not the obligation, to sell the underlying security at the strike price.

Each contract is different, and there are also different types of options. American-style options let traders exercise them at any time up until and on the contract’s expiration date, while European-style options can only be exercised on the expiration date itself.

How Exercising a Call or Put Option Works

Generally, traders have several choices when it comes to exercising their stock options. When a trader is ready to exercise an option, they can let their brokerage firm know. The broker will create an exercise notice to the Options Clearing Corporation (OCC) to let the individual or entity buying or selling the underlying stock know that the trader wants to execute a trade on a particular date. The option seller is required to fulfill the obligations of the contract.

The OCC assigns the exercise notice to one of their clearing members, often the trader’s brokerage firm. The broker then assigns the option to one of their customers who has written an option contract that they have not yet covered. Depending on the broker, the customer they choose may either be chosen randomly or picked on a first-in-first-out (FIFO) principle.

Exercise a Call

Exercising a call option means buying the underlying stock at the option’s strike price. If the stock’s market price is higher than the strike price, you can purchase it at a discounted rate. The key benefit of exercising a call is potential access to those lower rates, especially if the stock has risen significantly. Transaction costs, such as brokerage commissions, can erode potential profits — so consider these factors when deciding to exercise.

For example, say that an investor buys a call option with a strike price of $50. If the stock’s market price rises to $60, they can exercise the option to buy shares at $50 instead of the higher market price. This gives them a $10 per share gain before factoring in the cost of the option and fees. If they don’t want to buy the shares, they could sell the option for a profit instead.

Exercise a Put

Exercising a put option means selling the underlying stock at the strike price. This can be beneficial if the market price falls below the strike price. You can then sell the stock at a higher price than the market price in order to see a profit. Bear in mind that selling a put obligates the seller to buy the underlying asset at the strike price if the option is exercised. There are also brokerage fees associated with exercising a put to consider, as there are with calls.

Say an investor buys a call option with a strike price of $50. If the stock’s market price rises to $60, they can exercise the option to buy shares at $50 instead of the higher market price. This gives them a $10 per share gain before factoring in the cost of the option and fees. If they don’t want to buy the shares, they could sell the option for a profit instead.

How Do You Know Whether to Hold or Exercise an Option?

It can be difficult to know when and whether to exercise an option. There are different options trading strategies that can prove beneficial to exercising early, or to waiting or even selling the option contract itself. Many factors come into play when making the decision to exercise an option, such as:

•   Time Value: Understanding how options pricing works is essential, as time value plays a key role in deciding whether to hold or exercise an option. Time value is a critical aspect of options pricing and significantly impacts the decision to. Options may lose value as they approach expiration due to the time decay. If there’s still significant time left on the option, it may be beneficial to hold the option rather than exercising it since it has the potential to be profitable over time. On the other hand, selling could help you capitalize on the remaining time value, since an option with, say, two months left to expiration would have more time value than an option with two weeks left to expiration.

•   Intrinsic Value (In-the-Money or Out-of-the-Money): The decision to exercise is often influenced by whether the option is in-the-money. A call option, for example, is in-the-money when the underlying asset’s price is above the strike price. Exercising in such a case allows the trader to buy the underlying asset at a discount. On the other hand, out-of-the-money options hold no intrinsic value and are unlikely to be exercised.

•   Transaction Costs and Fees: Exercising an option comes with transaction costs, which can include brokerage commissions and fees. These fees can erode profits, so it’s important to weigh them against potential gains from exercising. In some cases, the cost of exercising an option may outweigh the benefit, especially when the option is close to expiration and there are minimal profits to be gained.

•   Risk and Margin Exposure: There can be a significant amount of capital needed to purchase underlying assets, especially with high-priced stocks. This may also involve using a margin account, which increases your exposure to risk and any potential costs associated with holding the position. Be sure to assess your risk tolerance and available capital before deciding to exercise an option.

The Takeaway

When deciding to hold or exercise an option, the top factors are time value, intrinsic value, and your appetite for risk. Holding options could offer the potential for greater returns, but exercising options can provide profits if they are in-the-money. There are also fees and capital gains to consider.

While investors are not able to sell options on SoFi’s options trading platform at this time, they can buy call and put options to try to benefit from stock movements or manage risk.

SoFi’s options trading platform offers qualified investors the flexibility to pursue income generation, manage risk, and use advanced trading strategies. Investors may buy put and call options or sell covered calls and cash-secured puts to speculate on the price movements of stocks, all through a simple, intuitive interface.

With SoFi Invest® online options trading, there are no contract fees and no commissions. Plus, SoFi offers educational support — including in-app coaching resources, real-time pricing, and other tools to help you make informed decisions, based on your tolerance for risk.

Explore SoFi’s user-friendly options trading platform.

FAQ

How are early-exercise options different from exercise options?

Early-exercise options refer to American-style option contracts only, which can be exercised on and at any point before their expiration date. European-style options can only be exercised on their expiration date.

What is a cashless exercise in options?

A cashless exercise occurs when an investor purchases stock without paying cash to do so. The option holder pulls from some of the exercised shares to cover the cost of purchasing the stock. This is more common with employees exercising stock options, rather than in options trading.

What happens when you exercise an option?

Exercising an option means taking action on the right granted by your options contract. For call options, this means buying the underlying stock at the strike price. For put options, this means selling the underlying stock at the strike price. Exercising an option is a commitment to follow through with the contract’s terms: If you choose not to exercise the option, it will expire worthless, and you lose the premium paid to acquire it.

What happens to premium when you exercise a call option?

You do not keep your option premium when you sell a call option. The premium is part of the cost of acquiring the option, and is considered a sunk cost once the option is exercised.

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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.

Options involve risks, including substantial risk of loss and the possibility an investor may lose the entire amount invested in a short period of time. Before an investor begins trading options they should familiarize themselves with the Characteristics and Risks of Standardized Options . Tax considerations with options transactions are unique, investors should consult with their tax advisor to understand the impact to their taxes.

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.

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.

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