What are Smart Contracts: 2021 Guide

2021 Guide to Smart Contracts

While the best known use of the blockchain is to store and transmit digital currencies, the blockchain also has many other uses. Among those uses are smart contracts, which makes use of the blockchain technology to automatically execute all or part of the agreements between two parties.

Some users are already using them to do business in the real estate and insurance industries, and they’re a big part of the decentralized finance industry.

Recommended: 9 Blockchain Uses and Applications in 2021

What Is a Smart Contract?

A smart contract is a digitally facilitated agreement between two parties that’s written in code into the blockchain technology. The code automatically executes the terms of the contract when agreed upon conditions occur. There is no third-party required to enforce the terms of the agreement.

How Do Smart Contracts Work?

Rather than having people and institutions back up a contract’s provisions, the blockchain automatically enforces it — “every node in the network holds a copy of the transaction and smart-contract history of the network. Every time a user performs some action, all of the nodes on the network need to come to agreement that this change took place,” according to Coindesk. This feature of smart contracts leverages the security of blockchain technology.

A Short History of Smart Contracts

The idea behind smart contracts predates the blockchain technology that made them possible. Cryptography and digital currency pioneer Nick Szabo, first used the term in the 1990s to describe “a set of promises, specified in digital form, including protocols within which the parties perform on these promises.”

What makes smart contracts “smart,” according to Szabo is that the contract is specified in a computer program or in code, that the contract is executed digitally, and that the exchange of goods that happens due to fulfillment or non-fulfillment happens in the same code or program in which the contract itself was written.

What helped make self-executing, smart contracts a reality was the development of the cryptocurrency Ethereum blockchain, which enables Ethereum.

Smart Contract Examples

While smart contracts are still a relatively new technology, several use cases for them have already emerged.

Decentralized Finance

Perhaps the most obvious arena for smart contracts is, well, money. After all, cryptocurrency is used as just that, a currency, and finance often consists of contracts between two parties surrounding the exchange of money over time.

Think of a typical loan payment, it’s a contract under which one party provides another with a certain amount of money and the other party agrees to transfer money back to the first party at certain dates and in certain amounts, if the borrower does not pay the lender, the lending party can commence legal action against the borrower.

Decentralized finance” seeks to use smart contracts to create financial products like loans that do not rely on third parties. Decentralized finance or “DeFi,” is one of the hottest areas of blockchain technology.

There are several examples of smart contracts in decentralized finance. One of the most prominent are “stablecoins” — cryptocurrency tokens with a fixed value. One stablecoins, Dai, is pegged at a one-to-one value with the dollar. Dai uses smart contracts for the creation of new tokens and governance of the entire token ecosystem.

Recommended: What Is a Stablecoin? A Closer Look

In practice, that means that if a user wants to issue new Dai tokens, they need to stake ethereum as a collateral. If the value of that underlying collateral falls below a certain threshold, the smart contract automatically sells the collateral in order to make up the difference.

Real Estate

One of the most enticing areas to use blockchain is in real estate. When purchasing a home, for example, you set up a contract with a bank and money transfers with the previous owners in exchange for what are essentially a set of legal rights to a property. This process is time-intensive, requires various agents and lawyers on both sides, as well as several complex transfers of money both at one time and over years. This is an area where smart contract developers have been hungry to get into.

While it’s unlikely that you’ll move into the house of your dreams by executing a smart contract, blockchain developers are looking into real estate by “tokenizing” properties, divvying up real estate into slices that investors can own or trade (including through smart contracts).

Here are a few companies already using smart contracts in real estate:

•  Harbor is using smart contract to tokenize a $100 million real estate fund.

•  DigiShares allows real estate developers to tokenize their projects using smart contracts.

•  Ubiquity uses black-chain based smart contracts to tokenize real estate and help reduce costs during escrow.

•  SmartZip, a real estate software company, has partnered with blockchain firm Chainlink to provide real estate pricing data to smart contracts.

•  Propy is a blockchain startup that facilitates real estate escrow through smart contracts.

Insurance

Insurance is another example of a complicated financial contract that many entrepreneurs and developers are looking to deploy blockchain technology in. Blockchain in insurance can mean a lot of things.

One possible model for it is “parametric insurance,” which pays out automatically under certain conditions that are definable in code in a smart contract. This is still an emerging area, but since the insurance industry relies on millions of contracts, it’s a natural area for blockchain smart contract developers to look into.

Here are a few ways smart contracts are actually being used in the insurance industry:

•  The Institutes RiskStream Collaborative is a consortium of 40 insurance industry members working together to build blockchain applications for industry use

•  IBM uses its blockchain technology to automate insurance underwriting using smart contracts.

•  Etherisc is a decentralized insurance protocol insurers are using for smart contracts and other services.

•  Sprout is an insurer that uses smart contracts to provide crop insurance to farmers.

•  Nexus Mutual serves as a decentralized insurance platform that aims to eliminate the need for third-party insurers.

The Takeaway

Smart contracts are one use for the blockchain, made possible in many cases through the adoption of cryptocurrency. Many investors view cryptocurrency, and the blockchain that makes it possible, as an important part of their investment portfolio.

An easy way to get started investing in crypto is by opening an account on the SoFi Invest® brokerage platform. SoFi Invest offers access to a range of cryptocurrencies including Bitcoin, Litecoin, and Ethereum, with up to a $10 bonus for your first trade.

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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 . 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.
1) Automated Investing—The Automated Investing platform is owned by SoFi Wealth LLC, an SEC Registered Investment Advisor (“Sofi Wealth“). Brokerage services are provided to SoFi Wealth LLC by SoFi Securities LLC, an affiliated SEC registered broker dealer and member FINRA/SIPC, (“Sofi Securities).
2) Active Investing—The Active Investing platform is owned by SoFi Securities LLC. Clearing and custody of all securities are provided by APEX Clearing Corporation.
3) Cryptocurrency is offered by SoFi Digital Assets, LLC, a FinCEN registered Money Service Business.
For additional disclosures related to the SoFi Invest platforms described above, including state licensure of Sofi Digital Assets, LLC, please visit www.sofi.com/legal. Neither the Investment Advisor Representatives of SoFi Wealth, nor the Registered Representatives of SoFi Securities are compensated for the sale of any product or service sold through any SoFi Invest platform. Information related to lending products contained herein should not be construed as an offer or pre-qualification for any loan product offered by SoFi Lending Corp and/or its affiliates.
Crypto: Bitcoin and other cryptocurrencies aren’t endorsed or guaranteed by any government, are volatile, and involve a high degree of risk. Consumer protection and securities laws don’t regulate cryptocurrencies to the same degree as traditional brokerage and investment products. Research and knowledge are essential prerequisites before engaging with any cryptocurrency. US regulators, including FINRA , the SEC , and the CFPB , have issued public advisories concerning digital asset risk. Cryptocurrency purchases should not be made with funds drawn from financial products including student loans, personal loans, mortgage refinancing, savings, retirement funds or traditional investments. Limitations apply to trading certain crypto assets and may not be available to residents of all states.
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SegWit: Definition & How it Works

SegWit: Definition & How it Works

SegWit is an update to Bitcoin’s protocol that changed the way that the blockchain transfers information. Protocols are the rules that govern the way that Bitcoin and other cryptocurrencies work.

What Is SegWit?

SegWit is an example of the Bitcoin development community being able to solve a problem while still maintaining the integrity of the Bitcoin protocol and blockchain.

SegWit stands for “segregated witness,” and it’s a key turning point in the history of Bitcoin and cryptocurrency, and represents a fork in the road, or at least a fork in Bitcoin. The SegWit fork changed the rules, allowing for larger blocks and removing signature data from Bitcoin transactions.

How Does SegWit Work?

SegWit removes (or segregates) the signature (or witness) from the block, moving it instead to the back of the transaction. This frees up more space for the transaction itself.

What Problems Does SegWit Solve?

SegWit solves several issues with earlier versions of the Bitcoin protocol.

The Transactions Problem

The original Bitcoin protocol limits the size of “blocks” to a single megabyte. The whole Bitcoin network “confirms” a new block every ten minutes, with a few transactions taking place every second. These blocks and the confirmation process comprise the foundation of Bitcoin.

As Bitcoin scaled and got bigger and more miners, developers, and users became part of the Bitcoin community, a debate arose around the size of blocks. Should it increase beyond founder Satoshi Nakamoto’s original vision or stay the same?

If the community decided to make an increase, it would have to receive approval by consensus, or perhaps risk splitting Bitcoin apart into separate protocols.

The Malleability Problem

The Blockchain also had some security and efficiency issues, known as “malleability.” Prior to Segwit, every Bitcoin transaction included a “signature” that became part of the transaction confirmation. The signature, with the use of a private key, would become part of the block transfer, taking up space that could have been more Bitcoin transactions. Another word for these signatures is “witness,” and so was born the idea of Segregated Witness, or SegWit.

The theory behind SegWit held that Bitcoin transactions could be more efficient, more secure, and better recorded on the Blockchain itself. This would also allow for developers to build transfer improvements on top of the original Bitcoin protocol, leading to the development of the Lightning Network.

The Scalability Problem

One of the major issues addressed by SegWit was the so-called “scalability problem,” which refers to the issue with block sizes that can limit the speed and scale of transactions on a Blockchain network.

When Was SegWit Created?

The Bitcoin Segwit update took place on August 23, 2017 and changed the way information was transferred on the blockchain.

Prominent Bitcoin developer Pieter Wuille originally proposed the update in 2015 as a way to address a problem in the less-than-a-decade-old protocol that governed the cryptocurrency. He and others believed that transactions took too long to process and that they had some security issues.

There were two ways, known as forks, to address the problem.

A hard fork

A hard fork creates a new system all together. Bitcoin Cash is an example of a hard fork, which enabled large block sizes, but ultimately created a new network.

A soft fork

With a soft fork, the new system works with the old one. This is the option that developers used for SegWit, which became one of the most prominent and important Bitcoin forks. In the dispute between soft fork vs hard fork, SegWit’s successful adoption is a victory for the soft forks.

Recommended: Differences Between Bitcoin Soft Forks and Hard Forks

What Was Segwit2x?

Some prominent Bitcoin miners supported several approaches to the scale issue inherent in the original Bitcoin protocol. To move forward, they came to what’s known as the “New York Agreement,” a plan to implement SegWit and do a hard fork of Bitcoin to increase the block size limit. This was “SegWit2X.”

However, Bitcoin’s developers didn’t endorse the plan and it never reached the consensus necessary for a successful hard fork. These developers have huge sway over the greater Bitcoin community and without their support, a fork wouldn’t have enough takers to challenge Bitcoin in its present set-up. By late 2017, SegWit2X had collapsed and early the next year, SegWit was fully operational on consumer cryptocurrency platforms like Coinbase. And major crypto wallets, the hardware and software products that allow for safe crypto storage, had signed on to the SegWit update.

The failure of SegWit2x shows that even large Bitcoin mining pools, groups of miners that run the hardware that creates new Bitcoin, don’t have total sway over the Bitcoin community and can’t singlehandedly dictate its direction – or its forks. Bitcoin miners have tended to prefer Bitcoin changes that would increase the block size as opposed to segregating out signatures, since that would bolster the fees they get from the network for processing blocks. But the Bitcoin community is more than just its miners, and so their opinion only means so much.

Should You Use SegWit?

While the Bitcoin scalability debate is hardly over, for the time being, Bitcoin itself remains in the driver’s seat in terms of usage and developer activity compared to its rivals and hard forks.

By early last year, at least two thirds of transactions used SegWit, indicating that the soft fork “works” for many in the Bitcoin community. By the end of 2020, one of the last exchanges to hold out, Binance, announced that it would support SegWit.

There are several benefits to using Segwit for crypto transactions, including lower transaction fees and faster transactions.

The Takeaway

SegWit was a major upgrade to the Bitcoin protocol, and one that has helped accelerate widespread adoption of the cryptocurrency in recent years.

You don’t need to be an expert in the details of Bitcoin protocol to start investing in cryptocurrency, however. You can get started by opening an account with the SoFi Invest® brokerage platform.

Photo credit: iStock/BartekSzewczyk


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 . 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.
1) Automated Investing—The Automated Investing platform is owned by SoFi Wealth LLC, an SEC Registered Investment Advisor (“Sofi Wealth“). Brokerage services are provided to SoFi Wealth LLC by SoFi Securities LLC, an affiliated SEC registered broker dealer and member FINRA/SIPC, (“Sofi Securities).
2) Active Investing—The Active Investing platform is owned by SoFi Securities LLC. Clearing and custody of all securities are provided by APEX Clearing Corporation.
3) Cryptocurrency is offered by SoFi Digital Assets, LLC, a FinCEN registered Money Service Business.
For additional disclosures related to the SoFi Invest platforms described above, including state licensure of Sofi Digital Assets, LLC, please visit www.sofi.com/legal. Neither the Investment Advisor Representatives of SoFi Wealth, nor the Registered Representatives of SoFi Securities are compensated for the sale of any product or service sold through any SoFi Invest platform. Information related to lending products contained herein should not be construed as an offer or pre-qualification for any loan product offered by SoFi Lending Corp and/or its affiliates.
Crypto: Bitcoin and other cryptocurrencies aren’t endorsed or guaranteed by any government, are volatile, and involve a high degree of risk. Consumer protection and securities laws don’t regulate cryptocurrencies to the same degree as traditional brokerage and investment products. Research and knowledge are essential prerequisites before engaging with any cryptocurrency. US regulators, including FINRA , the SEC , and the CFPB , have issued public advisories concerning digital asset risk. Cryptocurrency purchases should not be made with funds drawn from financial products including student loans, personal loans, mortgage refinancing, savings, retirement funds or traditional investments. Limitations apply to trading certain crypto assets and may not be available to residents of all states.
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Spare Change Savings

Spare Change Savings

If you’ve ever collected change–maybe in a piggy bank as a kid, or in a cup by the front door as an adult–you likely already know the benefits of spare change savings.

You generally don’t miss the coins you drop into your collection each day. But, once you get around to putting the whole pile in the bank (or a coin machine), you could end up with a few hundred bucks.

These days spare change saving or “round-up” apps make the process even simpler. They automatically calculate the difference between the amount you charge on your debit or credit card and the next dollar amount. They then divert that virtual change into a savings account.

Spare change savings (also known as “micro-saving”) can be a great way to kick start your savings and also help you start automating your finances. However, not all spare change apps are created equal.

Some of these apps charge fees, which can quickly erode your savings. And some actually invest your savings, which may not be ideal if you’re saving for a short-term goal, such as building an emergency fund or buying a car.

Here are some key things you may want to keep in mind when choosing a spare change savings app.

Recommended: What Are Round-Up Savings?

How Does Spare Change Saving Work?

The philosophy behind spare change savings is “little and often.” Every time you spend money, whether it’s on gas, groceries or dining out, an app rounds up that purchase and saves the change for you.

Spare change savings apps typically connect to your credit and/or debit card, take the virtual change from your linked checking account, and put the money into a separate account. For instance, if you buy a sandwich for $5.80, the app will automatically transfer 20 cents from your checking account into a savings account.

Some spare change apps put your money into a traditional savings account or a cash management account. Others invest your money in small portfolios, based on your risk tolerance and financial situation. There are also spare change apps that use saved funds to pay off debts that you designate, such as credit cards or student loans.

The Benefits of Spare Change Savings

There are a number of potential benefits to spare change savings. Below are some of the reasons you may want to try using one of these apps.

They can make saving easy and automatic

One of the biggest advantages of spare change savings is that it’s automatic. You don’t have to remember to bring your change to the bank or transfer money from checking to savings after you get paid in order to save money from your salary. And, unlike the change jar, the money saved is out of sight and out of mind.

If you’re struggling to save money, setting up a spare change savings app can help jump start the process and make it relatively pain-free.

Your savings can earn interest

Unlike the piggy bank method, a spare change app can put your savings into an account that can earn interest and help your money grow over time.

Some spare change savings apps, known as “micro-investing” apps, will offer users the opportunity to invest their money into stocks, bonds, and/or exchange-traded funds (ETFs). This involves risk, but if these investments do well, your savings could grow considerably.

They can make investing less intimidating

Micro-investing apps can make it easy to get started with investing, even if you currently don’t know anything about it. Generally, they’ll recommend a portfolio based on your goals and time horizon, turning your spare change into an investment on a small scale–a good way to experiment.

There may be extra ways to save

Some spare change savings apps partner up with other brands that will kick in a percentage of every purchase you make to your savings account. For example, if an app partners with Macy’s or Apple, every time you make a purchase from one of those retailers, a small percent of the total you spend would get added to your savings account (in addition to the round-up amount taken from your checking account).

Disadvantages of Spare Change Savings

There are some potential downsides to spare change savings apps. Here are a few you may want to consider before signing up for one of these apps.

They may charge fees

Some spare change apps charge monthly (and other) fees for using their services. Before signing up for an app, it can be a good idea to read the fine print and look into what, if any, fees you may be charged and how often.

Even if the fees are small, they could quickly eat into your savings, especially since the dollar amounts you’re putting away are small.

It’s possible to lose money through investments

If you choose to put your spare change savings into investments, there is some risk involved. Depending on market fluctuations, your money could grow. On the other hand, you could potentially lose some or all of your savings.

Micro-investing may not be ideal for emergency funds

If you go with an app that invests your savings, you may not be able to access the money immediately, which could be an issue if you’re faced with a financial emergency.

Another issue is that if your account is down in value at the time you need to withdraw the money, you would have to take a loss instead of waiting for market conditions to improve.

You might get hit with an overdraft fee

If your checking account is close to zero after you make a transaction, and then the spare change app rounds-up the transaction and withdraws additional funds, you could end up overdrafting your account. This could result in getting hit with a hefty overdraft fee.

The Takeaway

While each spare change app functions slightly differently, they all revolve around the same basic concept. You save small increments of cash that you likely won’t miss. The money gets put into a digital piggy bank, so it’s separated from the funds in your primary checking account. You can then use the money to work toward your savings goals.

Spare change apps aren’t for everyone, however. If you’re living paycheck to paycheck and at risk of overdrafting your account, these apps may not be ideal for you. And if you don’t yet have an emergency fund, you may not want to choose an app that invests your savings.

On the other hand, if you’re looking for creative ways to jumpstart your financial goals, a spare change app (with low or no fees) may be just the tool you’re looking for.

SoFi Money® makes spare change saving easy–and also free. When you open a SoFi Money cash management account, you can set up “Roundups,” which allows you to save automatically every time you use your SoFi debit card.

Learn how SoFi Money Roundups can help you save without even thinking about it.

Photo credit: iStock/Nattakorn Maneerat


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37 Places to Sell Your Stuff

37 Places to Sell Your Stuff

Decluttering can benefit both your mind and soul. It can also benefit your wallet. And, these days, turning your discards into real cash has never been easier to do.

Whatever you’re looking to unload—clothes, shoes, bags, elecontronics, furniture, decor, housewares–you can likely find a marketplace (online or offline) that can help you make it happen.

The key is knowing where to look. Here are 37 ideas.

Where Can I Sell My Stuff?

If you have items you no longer want or need, and you’re looking to make some extra money, why not kill two birds with one stone?

The following resale apps, sites, and stores may be able to help. Some of these services are free to list and sell, some take a percentage of profits, some pay cash outright, and others consign (meaning they sell your stuff and pay you once it sells).

1. Craigslist

One of the original online marketplaces, Craigslist is where you can list all sorts of things, from tools to toys to DVDS to antiques (and much more) for free.

2. Facebook Marketplace

Facebook Marketplace makes it easy to sell items in your local area. It’s free to create a listing that can be seen by anyone on and off Facebook. You can also choose to post your listings to any “Buy and Sell” Groups you’re a member of.

3. Amazon

While you may think that Amazon is where you can buy new things, there are also a lot of opportunities to list used items, especially books. With any type of item, you will pay 99 cents per unit sold (or if you sell a lot, you can opt to pay a flat fee of $39.99 per month). You’ll also pay a referral fee, typically between 8% and 15% of the sale price.

4. eBay

The original selling platform, eBay can still be a good way to sell your stuff, especially if you want to reach buyers from around the world, or you’re looking to unload an unusual item (there is almost nothing you can’t sell on eBay). But you may want to keep an eye out for selling fees, which may include a listing fee, a percentage of the sales prices, and possibly other fees.

5. OfferUp

OfferUp allows you to sell to someone local, or ship an item to a buyer who lives anywhere in the US. Most items are free to post. When you sell a shipped item on the site, you may be charged a fee that is a minimum of $1.99, or 12.9% of the sale price.

6. Poshmark

Primarily a site for selling used clothing, Poshmark also lets you list home decor and beauty products. For sales you make under $15, Poshmark takes a flat commission of $2.95. If you make a sale that’s worth $15 or more, it takes 20%.

7. Etsy

Etsy isn’t just a platform for artists to sell their handmade goods–the site also allows you to list some used goods. However, you can only resell in the “Vintage” and “Craft Supplies” categories. There is a listing fee of 20 cents per item, and, when you sell an item, there’s a small commission and payment processing fee.

8. thredUP

An online consignment and thrift store, thredUP sells thousands of major brands. You can send your gently used clothing directly to the service. If they accept (and sell) your clothing, you can choose from cash or credit from either ThredUp or an associated retailer.

9. eBid

Like eBay, you can sell just about anything on eBid, either for auction or at a fixed price. However, you may end up paying lower fees than you would on eBay–eBid generally charges 2% to 4% of the selling price.

10. Bookoo

Another platform for selling stuff locally is Bookoo, which doesn’t charge any listing or selling fees. Bookoo may not be as well known as other sites, but it is available in nearly every state throughout the US.

11. Vinted

If you have a lot of gently used clothes, shoes, and accessories to sell, you may want to check out Vinted , a peer-to-peer online marketplace that focuses on vintage and second-hand fashion. You won’t pay any fees unless you sell something.

12. Vestiaire Collective

If you have luxury items you want to sell, you may want to try Vestiaire Collective, a resale website where you can buy and sell high-end clothing, handbags, and accessories. When you sell an item, you can keep up to 80% of your money from the sale.

13. LePrix

Another place for selling authentic, pre-owned designer fashion is LePrix. Listing an item is free, but the site does charge fees when you make a sale.

14. TheRealReal

TheRealReal is a luxury consignment site where you can drop off or ship designer clothing, accessories, and jewelry, as well as fine art and upscale home decor. They sell your items for you in exchange for a percentage of the profit.

15. Rebag

If you have a designer bag that you no longer want, you might consider selling it on Rebag, a site that’s focused on buying, selling, and trading luxury handbags. The site will let you know how much your bag is worth. If you like the offer, you can send them your bag for free. Once it’s received and approved, you’ll get your payment.

16. Bag Borrow or Steal

Another site for selling luxury handbags is Bag Borrow or Steal. You can sell directly to the site (and get paid right away), or you can consign and receive 70% of the sales price after it’s sold.

17. Once Wed

If you aren’t sentimental about keeping your wedding dress, bridal party gown, or accessories, then you can list it on Once Wed . The site will charge you a one-time listing fee of $19.95 for your wedding dress and $5 for flower girl’s, mother’s, or bridesmaids dresses, as well as wedding accessories.

18. PreOwnedWedding

You could also try to sell your wedding dress on PreOwnedWeddingDresses.com , which will charge you a one-time listing fee of $25 per dress.

19. Garage Sales

If your goal is to unload a large amount of stuff all at once, hosting a garage sale can be a good way to go. You could even get some neighbors together and hold a community garage sale to attract more people.

20. Flea Markets

Community flea markets can be a great way to showcase your items for sale. The owner and operator of the flea market will likely charge you a fee for a booth. If you live in a big city, you may have to register early to get a spot.

21. Buffalo Exchange

Buffalo Exchange is vintage and used clothing store with locations throughout the US. If one of their stores is convenient to you, you can make an appointment to meet with a buyer. If they like your stuff, they will pay 25% of their selling price in cash or PayPal, or 50% in a Digital Trade Card.

22. Crossroads Trading

Crossroads Trading is a second-hand clothing store with brick-and-mortar locations throughout the US. If you visit a store, you may be able to receive cash for your clothing on the spot. For higher-end pieces, you can opt to consign. Crossroads also offers mail-in service.

23. Plato’s Closet

You can bring your gently used brand-name clothing and accessories to a Plato’s Closet near you. They’ll review your items and, if accepted, you’ll get paid on the spot.

24. Style Encore

A women’s resale store, you can bring in stylish, gently used clothes, shoes, handbags, and accessories to one of Style Encore ’s retail locations. If they like your items, you will get paid right away in cash.

25. Once Upon a Child

If you have gently used children’s clothing and shoes, toys, and/or baby gear lying around, you may want to cart it over to Once Upon a Child, which has locations throughout the US. An employee will check out your goods and, if they think they sell them, will give you cash in return.

26. Play It Again Sports

If you live near Play it Again Sports, you may want to consider bringing in all the no-longer-used sports equipment in your garage. You’ll clear out the space, and may get a nice amount of cash in return.

27. Music Go Round

Live in a musical household? Music Go Round is a resale music shop where you can bring in used instruments and sound equipment (like amps, MIDI equipment, and mixers) and get paid cash in return.

28. Local Thrift Stores

Unlike Goodwill or Salvation Army, thrift stores — specifically ones that sell high-end or vintage clothing — might be willing to buy your clothes and other items. Look up local stores on Google and ask them what they buy and how much they typically pay.

29. Used Book Stores

Your local used book stores may be looking to purchase your books from you. You can call ahead, let them know what you have, and see if they are interested.

30. BookScouter

If you’re looking to sell textbooks, you may want to check out BookScouter . The platform simplifies the process by searching sites that buy used textbooks, then displaying the prices from those sites, so you can compare and decide where to sell your books.

31. GoTextbooks

GoTextbooks also allows you to sell your college textbooks and, hopefully, recoup some of the money you spent on them. When you let the site know about what you have for sale, they will give you an instant quote. You can then ship your books for free and receive your money.

32. DeCluttr

If you mainly have electronics to sell, you may want to check out DeCluttr , which buys used tech, cell phones, DVDs, and video games. The site will give you an instant valuation. If you like the price, you can ship your item for free. If it meets expectations, you receive payment a few days later.

33. Gazelle

You may be able to turn your old cell phone intos some quick cash at Gazelle . The site will give you an instant quote. If you like the numbers, you can ship the phone to them for free, and get paid via Amazon Gift Card, PayPal, or check.

34. Pawn Shop

You may be able to make some quick money selling your old stuff to a local pawn shop. Typically, pawn shops are only interested in things of value, such as jewelry, collectible coins, and electronics. It can be a good idea to bring in proof of purchase so that the owner knows you aren’t trying to sell stolen goods.

35. Facebook Groups

If you’re in any local or niche Facebook groups, you may want to post items that might appeal to members of the group. You simply need to snap a picture, describe your item, and name your asking price. Then, hopefully, the offers will start rolling in.

36. Instagram

If you have a fair number of followers on Instagram, you might consider listing items you’re looking to sell there. As with Facebook groups, you simply need to snap a photo, write a brief description, and name your price.

37. Try a “Raid My Closet” Event

Do you have friends who might be interested in checking out what you have for sale? You may want to consider inviting them over for a “raid my closet” event, or a “raid my garage” party. You can offer food and drinks, and make it a fun celebration to declutter your home.

The Takeaway

If you’re holding on to clothes, furniture, books, or other items you no longer want or need, you could be sitting on a way to make some extra money–and de-clutter your space at the same time.

With all the online and offline resale channels now available, turning your unwanted possessions into cash has never been simpler. You don’t even have to have a garage sale (though, if you have a large number of items to unload, that might not be a bad idea).

What to do with all the profits that start rolling in? Consider putting your money into a cash management account, such as SoFi Money®.

With SoFi Money, you can earn a competitive interest rate on your money, and you’ll be able to spend and save all in one account (and pay zero account fees to do it).

Put your extra earnings to work with SoFi Money.

Photo credit: iStock/Zinkevych


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. SoFi Money Debit Card issued by The Bancorp Bank. SoFi has partnered with Allpoint to provide consumers with ATM access at any of the 55,000+ ATMs within the Allpoint network. Consumers will not be charged a fee when using an in-network ATM, however, third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.
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.
External Websites: The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
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31 Ways to Save Money on Car Maintenance

31 Ways to Save Money on Car Maintenance

Car ownership can be expensive–not only do you have to pay for the vehicle itself, there’s also maintenance to think about.

Between oil changes, brake pads, new tires, and dealing with the inevitable “check engine” light, car upkeep doesn’t come cheap. If you ignore car maintenance, however, you may be asking for trouble–and end up paying for major car repairs down the line.

The good news is that you can save on parts, labor, and servicing simply by being smart about how you maintain your vehicle. Read on, for simple ways to save.

How to Lower the Cost of Owning a Car

What follows are 31 ways to make vehicle maintenance less expensive. Some of these strategies help you save money right away, while others can lead to serious savings down the road.

1. Buying the Right Car

One of the best opportunities you have to lower your maintenance costs comes before you actually buy the car.

If you’re looking to buy a new car–or for a good deal on a used car–it can be wise to not only consider the purchase price, but also the long-term costs. With a little bit of research, you can likely find out the model’s repair record, and the average annual cost of upkeep.

Recommended: How to Save Up for a Car

2. Keeping Up With Oil Changes

It’s inconvenient and, with synthetic oil changes running around $70 a pop, the money you may not feel like spending. But this regular expense will almost certainly save you money in the long run. Oil lubricates your engine and keeps it from overheating. And, replacing the whole engine will definitely cost a whole lot more.

3. Reading Your Owner’s Manual

Unless you’re a serious car geek, you probably haven’t spent a lot of time perusing your owner’s manual. But this guide contains key information about what maintenance services need to be done and when making it essential reading. (If you’ve misplaced yours, you can probably find it online — just search for your car’s make, model, year, and the words “owner’s manual.”)

4. Timing Your Maintenance Properly

The maintenance schedule set out in the owner’s manual was created by your car’s designers to help you keep ahead of major repairs that would pop up if you didn’t intervene. Skipping preventative maintenance can be penny-wise, but pound foolish.

5. Knowing Fair Maintenance Prices

Charges for car maintenance services, like tune-ups and tire rotations, can vary widely depending on the shop. One way to find out if you’re being charged fairly is to research rates before you bring the car in. Websites like RepairPal can tell you what you should expect to pay for a particular maintenance task — and can even connect you with certified shops.

6. Patronizing a Mom-and-Pop Mechanic

Independent mechanics can sometimes offer lower pricing (and potentially better customer service) than auto repair chains, which have to cover the cost of being part of a franchise. So it can be worth shopping around. Exception: if your car is still under warranty at the dealership, you might void the agreement by taking it anywhere else, so it may be best to stick with them.

7. Sticking With the Same Shop

Although it might not matter for minor maintenance issues like oil changes, bigger services can be costly — and if you continually take your car to new mechanics, they won’t know your vehicle’s service history, which could lead you to pay for the same service twice.

8. Getting Your Transmission Fluid Changed

Transmission fluid is as vital to your transmission as oil is to your engine. This fluid is a lubricant that helps keep all of the moving parts inside of your transmission functioning properly. Transmission repairs are some of the priciest you can face, running anywhere from $1,000 to $5,000.

9. Getting Your Coolant Fluid Flushed

Yet another important fluid to keep an eye on, your coolant protects your engine from overheating, as well as offering more lubrication for certain engine parts. It usually needs to be changed out every 10,000 to 50,000 miles (you can find out in your manual), and failing to do so can lead to rust and dirt clogging up the system.

10. Cleaning Your Battery

You may not think about your battery very much…until the morning your car doesn’t start. To keep your battery in good working order, and avoid surprises, it can be good to occasionally clean the corrosion off the terminals using a small brush, some water, and baking soda.

11. Keeping Up With Your Transfer Case Fluid

This one only applies to those with four-wheel drive vehicles — but if you have one of those, you’ll likely need to familiarize yourself with the transfer case. That’s the part that shifts power from the transmission to the axles so the wheels can turn. And, like other parts, it has its own special lubricating fluid which needs to be regularly checked and changed.

12. Getting your Tires Rotated Regularly

You’ve probably already noticed how expensive tires are to replace — so chances are, you want to replace them as seldom as possible. Getting your tires regularly rotated and balanced can help ensure they wear evenly, which extends their overall longevity.

13. Carrying an Air Pressure Gauge

Maintaining optimum air pressure in your tires can improve your mileage (and save you money in gas) and also extend the life of those expensive tires. It also keeps your vehicle safe to drive. The good news? You can check your tires free of charge by keeping a tire gauge (typically less than $10) in your glove box.

14. Refilling Your Tires as Needed

As you roll around on them, your tires will gradually seep air over time — but you usually don’t need to schedule a special maintenance trip to refill them. Most gas stations offer coin-operated air pumps, and many even allow you to pre-set the proper PSI. (Otherwise, you can grab your pressure gauge.)

15. Regularly Checking Your Alignment

Alignment controls the angle at which your tires meet the road, and is important for making sure your tires wear evenly. Proper alignment also helps increase your vehicle’s gas efficiency, so it’s worth getting it checked at least once yearly, or sooner if you notice a pull as you’re driving.

16. Inspecting Your Shocks and Struts

Your shocks and struts, which keep your car from bouncing, also impact how quickly your tires wear, as well as your vehicle’s fuel efficiency. Depending on your driving habits, these generally need to be replaced roughly every 75,000.

17. Shopping Around for Tires

No matter how assiduous you are maintaining your tires, you’re eventually going to have to replace them. But unlike other car parts that may be proprietary to your car’s make and model, tires are pretty easy to shop for yourself — and doing so can lead to major savings. Warehouse discount clubs like Costco and Sam’s Club sell tires, as do online retailers like Discount Tire Direct .

18. Using Winter Tires Only in the Winter

Using winter tires can make driving in snowy conditions much safer. But these tires wear considerably faster than all-season tires, especially in non-winter conditions. So it can be a good idea to change your tires back to all-weathers as soon as the last frost has thawed.

19. Skipping the Winterization Package

Many mechanics will offer you a “winterization” service that involves flushing and replacing your coolant (also called antifreeze). However, you only need to have that done every 10,000 miles. If it hasn’t been that long since your coolant has been replaced, you don’t need this service.

20. Having Your Spark Plugs Inspected

Spark plugs literally spark the fuel that runs your engine. When the spark plugs start to fail, your engine won’t run as efficiently, and eventually, their misfiring could put stress on your catalytic converter, which is costly to repair. Fortunately, you can usually get up to 80,000 miles without needing to replace your spark plugs. When the time comes, however, it can be wise not to hesitate.

21. Changing Your Own Engine Air Filter

In most cases, paying a professional to do your maintenance and repair work is worthwhile in the long run (and less costly than making a mistake and hiring someone to repair it). But changing your engine air filter is actually easy. Since that filter keeps dirt and debris out of your engine, keeping it clean is key to your car’s longevity. There are plenty of YouTube tutorials you can check out to learn how.

22. Keeping Jumper Cables in the Trunk

This might not seem entirely necessary, but if your battery dies and you’re not near home, you’ll likely be glad you didn’t have to rely on a tow truck for such a simple problem.

23. Making Sure You Have Roadside Assistance

…That said, every once in a while, you might need a tow. If you do, having access to a roadside assistance program can be major cost savings. And, it can pay to shop around for this service. AAA might offer perks, like travel discounts, but the roadside assistance package offered by your car insurance company might cost less.

24. Heading to the Car Wash

It may seem like a minor detail, but keeping your car’s exterior clean can help the paint job last longer by removing road grime and residues that can eat through the finish. A $10 drive-through wash is way better than paying up to $900 for a new paint job.

25. Detailing the Interior

Your car’s interior is also vulnerable to staining and residue build-up that can lower your car’s overall value. At many car washes, you can access a powerful vacuum that can get rid of loose debris, but giving your car’s interior more thorough attention every few months may help you resell it for a higher price later.

26. Waxing Your Vehicle Every Six Months

Waxing your vehicle twice a year is another important way to help keep the paint job looking fresh and new. It can also help to avoid rust build-up that can cause structural damage to the body of your car.

27. Changing Your Own Light Bulbs

For most bulbs on your car, changing them isn’t difficult. They typically have a twist-and-pull bayonet base or simply pull out and push in. You can find usually replacement bulbs in any auto parts store, and sometimes even hardware stores. In some cases, accessing a bulb can be tricky, so you may want to check the manual or look online if getting the bulb out isn’t obvious.

28. Paying Attention to Recalls

If your car’s manufacturer sends out a notice about a recall, it’s likely worth making an appointment at your local dealership — no matter how insignificant the problem may seem. The recall repair will be free at the dealership, and it could save you from more extensive damage that would not be covered.

29. Buying Some Touch-Up Paint

Just like washing and waxing, using touch-up paint can be a smart maintenance measure. With a little bit of touch-up paint, you can seal chips and cracks early on before they have a chance to become a real (and real expensive) problem like rust or paint decay.

30. Heeding the Check Engine Light

It may be annoying, but your check engine light is trying to tell you that something needs your attention. And, typically, it’s better to pay attention sooner rather than later. A small repair cost now is better than a large one later on if you let that light go for a few months.

31. Driving Less

The less you drive, the less wear-and-tear you put on your vehicle– and the lower your maintenance and repair costs are likely to be. When it’s possible, you may want to consider walking, biking, or carpooling, which are not only wallet-friendly,

Recommended: 7 Ways to Save Money on Commuting to Work

The Takeaway

Generally speaking, the best way to keep your car maintenance costs low is to keep up with maintenance in the first place. That means referring to your manual and following the recommended service schedule.

You can also save money on car ownership by doing some basic vehicle care yourself, such as keeping your car clean and inflating your tires properly, as well as shopping around for a mechanic who charges fair prices.

To make sure you have enough money to cover all the expenses of car ownership, it can be a good idea to set up a dedicated “car fund,” which is easy to do with a SoFi Money® cash management account.

With SoFi Money’s special “vaults” feature, you can separate your savings from your spending (and even create different vaults for different goals), while earning competitive interest on all your money.

Start saving for car maintenance costs with SoFi Money.

Photo credit: iStock/MrJub


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. SoFi Money Debit Card issued by The Bancorp Bank. SoFi has partnered with Allpoint to provide consumers with ATM access at any of the 55,000+ ATMs within the Allpoint network. Consumers will not be charged a fee when using an in-network ATM, however, third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.
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.
SOMN0621058

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