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If you’re asked to void a check, your response might be “Huh?” Checks are being used less often these days, what with the advent of online banking and shopping. Back in the olden days of pre-internet life, people widely used checks for everything from buying groceries to paying utility bills. But now, an increasing number of people are conducting transactions by card, autopay, or P2P platforms.

Although checks are becoming less common, there are still times when you may need a voided one. But how do you void a check?

Voiding a check is simple. All it takes is to write “VOID” on the face of a blank one with a permanent pen. However, there are some subtleties to the process that it’s wise to understand. Here, you will learn:

•   How to void a check

•   Reasons for voiding a check

•   How voided vs. canceled checks compare

•   What to do if you don’t have checks.

How Do You Manually Void a Check?

To manually void a check, all you need is a blank check and a pen. Sure, your personal checkbook may seem like an ancient relic from a bygone era, but there are circumstances when life may request that you open it to void a check.

If you’ve never done it before, here’s how to write a void check:

•   Take a blank check from your checkbook.

•   Grab a blue or black pen or marker.

•   Write “VOID” across the face of the check. Do not cover the account numbers at the bottom.

•   Note the check number, recipient, and date in your checkbook so you don’t get confused by a skipped check when you go to balance your funds.

•   You could also write “VOID” in the payee line, amount line, amount box, or the signature line. That’s all there is to writing a void check; you’re done.

Reasons for Voiding a Check

There are several reasons why you might need to make a void check. Blank checks in the wrong hands can be financially dangerous. Writing “VOID” across your check renders it useless. A thief will not be able to use it to take money out of your account.

But there are practical uses for voiding a check that go beyond protecting your money, including setting up direct payments or deposits, and automatic bill payments. Here’s a closer look at how voided checks work.

Setting Up Direct Payments

If you or your business needs the ability to pay your vendors electronically, providing a voided blank check may be part of the process in the steps to set that up. The voided check provides your bank’s routing and your account number, which are needed to get ACH funds flowing.

Direct Deposits

Direct deposits have become the preferred way for employees to quickly get their hard-earned dollars into their checking accounts. Your employer may ask for a voided check along with the paperwork in order to get you enrolled. Again, this voided check allows for the capture of your account details.

Recommended: How to Verify a Check

Regular/Automatic Bill Payments

You can set up monthly autopay payments with utility companies, student loan entities, landlords, and others by providing a voided check. The amount owed will automatically be withdrawn on a set date.

Any Mistakes Made When Writing a Check

If you accidentally write the wrong amount, or make an error in the recipient’s name, you’ll want to void the check and write a new one. Doing so will prevent a person or business from cashing the check.

Voided vs Canceled Check

You may wonder what the difference between a voided and a canceled check is. When you make a void check, you are canceling a physical check you have in your possession. After all, you can’t write “VOID” on a check you don’t have. If you’ve lost a check (especially a blank one) or have sent out a check in error, that’s a different situation. You can contact your bank about stopping payment on the check.

Worth noting, as it can complicate matters a bit: When banks and credit unions talk about canceled checks, however, they are likely referring to ones that have already been used to transfer funds. The work of these checks is done, so to speak, so they are considered canceled.

The differences between a voided check and a canceled check (in both senses) are:

•   You can void a check yourself. To cancel a check, however, a bank or credit union has already been involved.

•   Voiding is quick and free. If you seek to cancel a check by stopping payment, it will involve time (to speak to your bank), and there may be a fee charged to stop payment.

•   To void a check, all you need is a pen to write the word “VOID.” Typically, banks cancel checks after processing them. If you want to execute a stop payment so a bank doesn’t pay a check, you’ll need your check number, account number, the date you filled it out, and the exact amount of the check.

•   When you void a check, you can forget about anyone ever using it. When a check is canceled by a bank, it is no longer valid; it has been paid and no longer has value. However, if you issue a stop payment on a pending check, you may want to keep an eye on your account to make sure no funds were withdrawn as the stop was being initiated.

Recommended: How Travelers Checks Work

What if You Don’t Have Checks?

This discussion about voiding checks may not do you a lot of good if you don’t have any checks. Obviously, the first step to getting a checkbook is to open a new bank account. Many banks will give you pre-printed “starter checks” to use until your personalized ones arrive.

If you already have a checking account but no checks, you can contact your bank or credit union about ordering checks. They can usually be ordered online, via a mobile app, over the phone, or in person.

If you can’t provide a voided check, there are plenty of other ways to set up direct deposits, automatic bill payments, and perform other financial transactions.

Using Deposit Slips

A deposit slip is a check-sized form you can fill out whenever you need to deposit money into your checking or savings account. They are usually found at the back of your checkbook or at a bank.

Since a deposit slip in your checkbook will have your name and account information, you may be able to use the pre-printed slip to authorize auto-pay or direct deposits.

Electronic Images of Checks

In place of an original check, you could print out an image of your check if you have one, void it, and use that instead. When you sign up for checks online, some banking entities can provide an image of your check with your account information.

Submitting Bank Details Online

In this day and age, you usually don’t need a voided check to sign up for automated payments and direct deposits. Most companies offer the option to register for these services online by typing in your checking account and bank routing number.

Asking the Bank for Counter Checks

If you don’t have checks and need one, you can ask your bank for what’s known as a counter check. This is not unlike the temporary “starter checks” you receive when you first open a checking and savings account. You can get a counter check from a teller behind the counter at the bank (thus the name). The counter check will have the bank’s routing number, and either you or the teller will fill in your account information.

Getting Documentation from the Bank

If you can’t get a hold of a check to void, an electronic check image, or a pre-printed deposit slip, a last resort solution could be getting proof of your account from a bank. This should be a letter written on a bank’s letterhead, verifying your routing number, account number, and account type.

The Takeaway

In the world of financial transactions, checks may be used less and less these days. But they still have their time and place, and sometimes you need a voided check. It can help you sign up for speedy modern services like autopay and direct deposit. Knowing how to void a check is a good skill to have, and it’s part of becoming a savvy financial customer.

At SoFi, we are all about helping you bank smarter. Open our Checking and Savings with direct deposit, and you’ll receive free paper checks. Plus, your money will grow faster with our competitive APY and no account fees.

FAQ

How do I void a blank check?

To void a blank check, take a blue or black pen or marker and write “VOID” across the face of the check. You could also write “VOID” in the payee line, amount line, amount box, or the signature line.

How do I void a check for direct deposit?

You void a check for direct deposit by writing “VOID” across the face of the check with a blue or black pen or marker. Or you could fill that in on the payee line, amount line, amount box, or the signature line.

How do I void a check I’ve already sent?

You can’t void a check you have already sent. You’ll have to cancel the check. To do this, first make sure the check hasn’t cleared yet. Then, make sure you have your account number, check number, dollar amount, and date you wrote on the check. Contact your bank or credit union to stop payment. This action may require a fee.

Photo credit: iStock/AsiaVision

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2023 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
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.

SoFi members with direct deposit activity can earn 4.60% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a deposit to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate.

SoFi members with Qualifying Deposits can earn 4.60% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant.

SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.60% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

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

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

Interest rates are variable and subject to change at any time. These rates are current as of 10/24/2023. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.

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.

SOBK0522017

Renting a car with a credit card is easier than renting a car without a credit card, but both methods are possible at many major car rental agencies. Car rental companies typically put customers through more hoops to rent a car without a credit card.

In this guide, we’ll cover how to rent a car without a credit card — but also explore the potential perks of paying for a rental car with a credit card, when possible.

Recommended: When Are Credit Card Payments Due

Is It Possible to Rent a Car Without a Credit Card?

So do you need a credit card to rent a car? Technically, no, you do not have to have a credit card to rent a car. It’s possible to rent a car with a debit card at some major rental agencies. Some agencies even accept prepaid gift cards, cash, or money orders as a form of payment at the end of the rental.

Each rental agency has its own stipulations about paying by debit card. Some franchises may not follow corporate policy, so it’s always a good idea to call the specific rental agency location to ask about payment options before arriving at your destination.

Common requirements for customers paying for a rental without a credit card include:

•  Security deposit: Many agencies will put a hold on your debit card for the cost of the rental, plus an additional amount. You will not be able to use the money being held for the duration of your trip, which can make funding your vacation more challenging.

•  Credit check: If you are paying with a debit card (or cash), some rental car agencies may perform a credit check. This could result in a hard inquiry on your credit report, which might temporarily lower your score.

•  Identification: Renting a car without a credit card might mean that the rental agency needs to see multiple valid forms of ID.

•  Age: While 25 is often the magic number to rent a car, it is possible to rent a car as a younger driver. Many agencies charge “young driver fees” to do so. However, if you are renting a car with a debit card, agencies may not allow drivers under the age of 25.

•  Proof of return travel: If renting from an airport with a debit card, many agencies want to see a ticketed return travel itinerary as an extra assurance that you will return with the car.

•  Logos: Some rental car agencies require debit or prepaid cards to carry the logo of a major credit card company, like Mastercard, Visa, or Discover.

The following rental car agencies allow you to rent a car without a credit card at participating franchises if you meet their specific requirements (though note this is not an exhaustive list):

•  Alamo

•  Avis

•  Budget

•  Dollar

•  Enterprise

•  Hertz

•  Thrifty

Recommended: Buying a Car with a Credit Card

Why Rental Car Agencies Typically Require a Credit Card to Rent a Car

Why do you need a credit card to rent a car at some agencies, and why do others impose a number of requirements for debit card payments? Here are the reasons rental car agencies require a credit card or other information.

Proof of Reliability

Having a credit card inherently demonstrates to a rental car agency that a creditor trusts you enough to borrow their money. Because rental car agencies can ascertain your creditworthiness from a credit card in your name, they don’t need to run a credit check before loaning you a $25,000 piece of machinery.

Recommended: Does Applying For a Credit Card Hurt Your Credit Score

Ability to Collect Repair Fees

If you return the car damaged, the rental car agency will need to pay for these repairs. Car insurance (whether through your own policy, credit card travel insurance, or the agency’s policy) may cover most of the charges, but you still might owe a deductible. Without proper insurance, there is a risk that the repair costs will exceed your security deposit.

Though you can rent a car without a credit card, if you pay with a debit card, the rental agency runs the risk of your checking account not having enough funds to cover the cost. There is a better chance the agency can charge your credit card without hitting your credit limit.

Recommended: What is the Average Credit Card Limit

Ability to Collect Tickets and Fees

Similarly, if you go through any electronic toll booths or receive a ticket without being pulled over (e.g., through a traffic camera), the rental car agency can charge your credit card to pay the outstanding balance. Again, they face less risk of maxing out a credit card than overdrawing a checking account, which is why some agencies prefer customers renting a car with a credit card.

Recommended: The Rental Car Rebound

Benefits of Using a Credit Card for a Car Rental

Here are just a few potential perks of swiping your credit card for a car rental:

•  It’s easier. As discussed above, renting a car without a credit card can complicate the process.

•  You might have insurance. Some travel credit cards offer car insurance when you use them to pay for a rental car. Research your card’s policy carefully to understand what coverage it provides and how to use it. For example, many credit cards with travel insurance require that you decline the rental agency’s insurance; some only offer secondary insurance, meaning you need to file claims through your own auto insurance first.

•  You might get discounts. Some credit cards offer special discounts at select car rental agencies. Check your card’s policy to understand where and how to get discounted rates.

•  You could earn rewards. As mentioned above, you might qualify for cash back rewards when you opt to cover your rental car with a credit card payment. Other cards may pay out rewards as miles or points. Travel credit cards might even offer extra points for travel-related expenses, like rental cars.

Recommended: Tips for Using a Credit Card Responsibly

Typical Rental Car Credit Card Interest Charges

When you rent a car, the agency typically puts a hold on your credit card for a set amount, often the value of the rental car agreement; this is commonly called a security deposit. During the rental period, these funds will count toward your credit limit.

When you return the car, the agency will charge you the amount of the rental, plus any fees incurred during the rental (damages, extra days, late drop-off, etc.). If the initial hold was more than the final cost of the rental, the agency will put that amount back on your card.

Because you pay interest on money borrowed with a credit card, it’s possible you might incur interest on the held security deposit. However, paying off a credit card in full every month is a smart strategy for avoiding interest charges given how credit cards work.

Recommended: 10 Credit Card Rules You Should Know

The Takeaway

Renting a car with a credit card makes the process much easier and can have benefits for the renter as well. However, it is possible to rent a car without a credit card. Just be prepared to take additional steps to get behind the wheel.

Whether you're looking to build credit, apply for a new credit card, or save money with the cards you have, it's important to understand the options that are best for you. Learn more about credit cards by exploring this credit card guide.

FAQ

Do I need a credit card for rental car insurance?

You do not need a credit card to purchase rental car insurance. While using a credit card makes it easier to secure a rental, most agencies allow you to pay upon your return with a credit card, debit card, or even cash, a gift card, or a money order. That includes the cost of insurance provided by the rental agency.

However, many car insurance providers cover rental cars in their policies, especially in the United States. Check with your agent to see if you’re covered. Additionally, some credit cards offer rental car insurance when you use them to pay for the rental. Your credit card benefits administrator can explain how, if, and when coverage applies.

Is it easier to rent a car with a credit card or debit card?

Renting a car with a credit card is easier than renting a car with a debit card. Many agencies will let you rent with a debit card; they just have additional requirements for you to meet before renting.

What form of payments are accepted for renting a car?

While rental agencies generally prefer credit cards for payment, some agencies allow you to book and rent a car with a debit card. Upon return, you may be able to pay for the car with a gift card, cash, or money order.

Can I use someone else’s credit card to rent a car?

If you use someone else’s credit card to rent a car, that person must be present to pick up the rental and be the main driver. If you intend to drive the rental, you will likely have to pay a fee for an additional driver, as you can’t be listed as the primary driver when using someone else’s credit card.

Photo credit: iStock/skynesher
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.

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.

SOCC0522007

Are you toying with the idea of opening a Christmas Club account? It may sound like a retro idea out of the movie “Elf,” with glitter and snowflakes, but a Christmas Club (or Holiday Club account) is simply a short-term savings fund that can help you plan for and manage the annual spending blizzard. The strategy can be smart, since during the 2021 holiday spend, 36% of consumers went into debt, owing an average of $1,249, according to a recent survey.

Pacing yourself to save in advance of the holiday crush is great, but the pros and cons of a Christmas Club account are not always crystal-clear. Learn the details of these accounts here, including:

•   How Christmas Club accounts work

•   Balance requirements for Christmas Club accounts

•   Withdrawal limits

•   Fees for Christmas Clubs.

What Is a Christmas Club Account?

To answer the question, “What is a Christmas Club account,” it may help to understand the history of these financial tools. Christmas Club accounts started in 1909 at a Pennsylvania bank and are designed to help you save money for holiday expenses. They typically do not earn high interest but can help you pull back your purse strings when December comes along and avoid debt.

After making regular, scheduled contributions to the Christmas account, the money is withdrawn, typically in October, November, or December, depending on your bank’s rules. Christmas Club funds are transferred to your regular checking account with the bank or withdrawn in a check to cover your holiday expenses, be they toys, trimmings, or latke parties.

Saving in increments can be easier on your budget than scrambling for cash when Yuletide, Hanukkah, and Kwanzaa come around. It can also spare you from putting all those charges on your credit cards and having a high balance due.

How a Christmas Club Account Works

Here’s how a Christmas Club account works. When you sign up for one, you start with a deposit. Rules and regulations vary by bank. Some require a minimum to start; others don’t. Some have no minimum balance requirement in person at a branch, but do need a $25 minimum for setting up a Holiday Club account online.

You decide the amount you want to contribute regularly. For instance, you might opt for $25 or $100 swept from your checking account into your Christmas account every week or every payday.

Historically, banks have charged fees for withdrawing money before the club account matures. That encourages consumers to leave their money there until holiday shopping time. Just be aware that if an emergency comes up, like a broken water heater, and you take the money out, you will get hit with a fee.

Reasons to Use a Christmas Club Account

There are several benefits to Christmas Club accounts that can make them a helpful financial tool. Here are some of the reasons why people open them:

•   To save for a predictable spend above and beyond your year-round monthly budget. Many of us try to celebrate the holidays on a budget. But the gifting/decorating/entertaining spree can still hit every winter. A club account plumps up a money cushion to help you avoid credit card debt.

•   To afford holiday travel. Most of us need extra dough, whether to rent a car to visit family or fly the kids home from college. To score the lowest airfare, car rental, and lodging costs, brush up on smart tips for finding travel deals. (If short-term savings won’t cover your trip, shop for the best travel loans with lower APRs, no compounding interest, and no fees.) Stashing funds in a club account, of course, is a viable solution.

•   To build up funds for other planned annual costs. Just because they are called Christmas Club accounts doesn’t mean they have to be used for holiday spending. Puzzling over how to save on spring break expenses or how to pay for your child’s summer sleepaway camp? In those cases, a club account can be golden.

Where Can You Find a Christmas Club Account?

Christmas Club accounts are most often available at smaller community banks and credit unions. You can open one in person at a branch or online at your bank’s website. (Search under savings accounts.) Often, the same banks that set up payroll direct deposit plans also offer short-term club accounts.

Christmas Club accounts are offered at credit unions all across America, from the Space Coast Credit Union in Florida to the Pasadena Federal Credit Union in California, and in too many places in between to count.

Pros of a Christmas Club Account

If you’re trying to decide if a Christmas Club account is right for you, it’s worthwhile to consider the advantages of these accounts.

Simplifies the Process of Saving for the Holidays

Framing your holiday budget ahead of time can cut stress. Pacing yourself to save over months may be even better. If it helps, you can give these targeted accounts nicknames to keep your eye on the goal; say, “Christmas in Vermont” to “Kids’ Lego Fund.”

Alternative to Putting Holiday Purchases on Credit Card

Using Christmas cash can help you avoid overspending with credit cards. Once you turn to plastic, things can get out of control. You start hunting online for a scooter a child has her heart set on and then see an ad for the brown suede boots you’ve been wanting…ka-ching. Interest rates on credit cards are quite high, and you can be left with debt that takes a long time to pay off. (If you do end up using a credit card, here’s how to avoid being scammed during the holiday season.)

Recommended: How Does a Credit Limit Work?

Cons of a Christmas Club Account

It’s not all a winter wonderland; Christmas Club accounts can have downsides. Here are a few to consider.

Most Banks Have Saving Limits

Most Christmas Club accounts have a maximum dollar amount you can save. Some banks allow up to $5,000, but this number will vary. The cap might be less than what you’d like to save. If need be, consider opening a second Christmas club if the bank allows it or open an additional one at another bank, too.

Potential Fees for Early Withdrawal

If you need to get the money out before the set withdrawal date, you will most likely incur early withdrawal fees. These can vary. Find out what they are when you open your account.

Alternatives to Christmas Club Accounts

If you want to save money for the holidays but aren’t sure a Christmas Club account is right for you, consider these options.

•   Certificate of Deposit. A certificate of deposit (or CD) generally offers a higher interest rate than a savings account but comes with a term. The bank holds your money for anywhere from months to years, and you collect the interest when the CD matures at the end of the term. Since a CD will lock up your money for a specific amount of time (typically between six months and 18 months, but shorter and longer terms are available), you may need to plan this right to have funds available for holiday expenses.

•   Money Market Account. A money market account is an interest-bearing account that is federally insured and has competitive interest rates. It generally requires a higher opening deposit.

•   High-yield Savings Account. These high-yield bank accounts earn significantly more interest than standard savings; you may find the best rates at online banks. However, the accessibility of these funds can be a downside. We all know how tempting it can be to transfer money from savings to checking when an unexpected household expense or special occasion comes up.

•   Travel account. Like Christmas accounts, these savings accounts likely won’t pay great interest, but they help you save for your goal. You can pick where to keep travel fund savings, and then use the money to hop on a plane when the holidays roll around.

The Takeaway

Christmas Clubs (or Holiday Club accounts) can spur you on to save regularly for the winter holiday spend. Planning ahead reduces stress. What’s more, setting a savings goal can help you keep your eye on the limit and avoid credit card overspending. But beware of fees for early withdrawals and caps on total amount saved. In some cases, you might be better off with another savings vehicle, like a CD or money market account.

Another option is to stash cash in a high-yield account and earn more interest there. SoFi makes it easy with our Checking and Savings. When you sign up with direct deposit, you’ll earn a stellar APY, pay no fees, and have easy access to spending and savings, all in one place.

FAQ

Do banks still do Christmas Club accounts?

Yes, community banks, smaller banks, and credit unions still offer Christmas Club accounts. Ask at your branch or search the bank’s website.

Are Christmas Club accounts worth it?

Christmas Club accounts generally have low interest rates. However, they can be worthwhile if they help you put money away regularly and thereby avoid a holiday spending blowout using credit cards.

Is there interest on Christmas Club accounts?

Yes, most accounts offer interest. The rates, though, tend to be lower than the interest rates for regular savings accounts, money market accounts, and certificates of deposit (CDs).

Photo credit: iStock/NoSystem images
SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2023 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
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.

SoFi members with direct deposit activity can earn 4.60% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a deposit to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate.

SoFi members with Qualifying Deposits can earn 4.60% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant.

SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.60% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

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

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

Interest rates are variable and subject to change at any time. These rates are current as of 10/24/2023. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.

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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