What Does Unlimited Cash Back Mean? Is It Worth It?

What Does Unlimited Cash Back Mean? Is It Worth It?

There are lots of different credit card types to choose from, especially if you have a high credit score. In an attempt to earn your business, many card issuers offer rewards every time you use their card, including unlimited cash back for qualifying purchases.

What unlimited cash-back means is you can earn uncapped rewards using the card — in other words, your earning potential isn’t limited to a certain amount. While this might sound too good to pass up, there are both pros and cons to consider to determine whether unlimited cash back is worth it for you.

What Is Cash Back?

Cash back is a type of reward that a credit card issuer may offer through its rewards credit cards. Depending on the terms, cardholders can earn a certain percentage back on qualifying purchases (cash advances typically don’t qualify). For instance, you may be able to earn 2% cash back on purchases at gas stations, or 3% back at grocery stores.

Some cards may put caps on how much cash back you can earn. As an example, a card may limit cardholders to 2% cash back for up to $5,000 in purchases in a calendar year. While cardholders may still be able to earn cash back after they’ve hit their certain earnings threshold, they may earn rewards at a lower rate thereafter.

Recommended: Can You Buy Crypto With a Credit Card

Cash in on up to $300–and 3% cash back for 365 days.¹

Apply and get approved for the SoFi Credit Card. Then open a bank account with qualifying direct deposits. Some things are just better together.


What Is Unlimited Cash Back?

Unlimited cash back means that your credit card offers cash-back rewards with no caps or limits on how much you can earn. In most cases, you can earn cash back on all of your purchases, though some cards may only offer unlimited cash back on certain spending categories.

For most credit cards, your cash-back rewards don’t expire as long as you keep your card open. This means that if you continue racking up rewards, you may be able to redeem your accumulated cash-back rewards for a sizable statement credit or other perk.

How Unlimited Cash Back Credit Cards Work

How credit cards work that offer unlimited cash back is that they allow cardholders to earn cash back on their purchases with no earning cap. In other words, there is no limit as to how much you can earn on qualifying purchases with these types of credit cards.

As you earn these rewards, you can redeem them in several ways. This includes as a statement credit or actual cash via a check or bank transfer.

In general, you’ll need good or excellent credit (meaning a score of 670 or above) to qualify for an unlimited cash back card. That being said, there are also cash back credit cards with less stringent credit card requirements, meaning you may be able to qualify even if you have a fair credit score or limited credit history. In general, however, the higher your score, the better the rewards tend to be.

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

Pros and Cons of Unlimited Cash Back

Before signing up for an unlimited cash back credit card, consider the advantages and disadvantages first.

Pros

Cons

Can earn money back on purchases, with no caps on earnable rewardsGenerally need at least good credit to qualify for top rewards programs
Don’t have to worry about hitting spending thresholds or other capsMay need to pay an annual fee
Simple and straightforward to earn and redeem rewardsLike other rewards credit cards, may have a higher APR than standard credit cards
Can help to build credit with responsible usageNot as lucrative of a rewards option for frequent travelers

Is Unlimited Cash Back Worth It?

Getting an unlimited cash back credit card might be worth it if you’re confident you can maximize its rewards. For instance, if you continually make purchases in higher rewards categories, you can save some serious cash due to the rewards earnings. Ideally, you’d be able to earn enough rewards to entirely offset the annual fee, if your card has one.

An unlimited cash back card may not be a great fit if you continually carry a balance on your credit card, given what a credit card is and how you’ll accrue interest. Your interest rate will likely be higher than the cash back rate you’ll earn, which means carrying a balance could cancel out rewards earnings.

Another reason to think twice about an unlimited cash back card is if you’re a frequent traveler. A travel rewards program may be a better choice since you can earn free flights, hotel rooms, and even cash back. Plus, you might earn more lucrative rewards on travel-related spending than a cash back card would offer.

Recommended: How to Avoid Interest On a Credit Card

Categories of Unlimited Cash Back Credit Cards You Can Choose From

There are several ways credit cards give you cash back, including flat rate and through different spending categories.

Flat Rate

Flat-rate rewards allow you to earn the same cash-back rate across all purchases made using a credit card. For instance, you might earn 3% cash back on all purchases made with the card. Some may issue you a certain percentage cash back when you make a purchase, and then another amount you pay off your credit card bill. Regardless, your specific spending category won’t matter for earning with a flat-rate rewards card.

Rotating Categories

Your credit card may offer several spending categories each quarter that you can select from to earn cash back. For instance, you might be able to choose to get 5% cash back on purchases at gas stations or office supply stores for the first quarter. After the quarter is over, you can choose a different spending category.

While rotating categories can allow you to maximize your rewards-earning potential, this setup does require some strategizing. You’ll need to stay on top of choosing a new category each quarter. Plus, you’ll then have to make sure you adequately take advantage of spending within that category.

Fixed Spending Categories

Instead of choosing different categories every quarter, some credit cards offer fixed cash-back earnings for various spending categories. For instance, a card may allow you to earn 3% cash back for purchases at grocery stores, and 1% cash back on all other purchases.

While fixed spending categories require much less planning ahead for, you will want to ensure the card you sign up for rewards you in a category you regularly spend in. Otherwise, you could end up forgoing valuable rewards.

Maximizing Unlimited Cash Back Earnings

If you want to make the most of earning unlimited cash back, here are some general credit card rules to keep in mind:

Select the Right Card

It’s a good idea to do your research and find a card that matches your spending habits. For example, if you use your credit card a lot at gas stations, it might not be the best choice to sign up for a card that doesn’t offer cash back rewards for this category.

Time Your Spending

If you sign up for a credit card with a sign up bonus, consider timing your card opening with a major purchase you’d been planning. Doing so will help ensure that you meet the minimum spend requirements in order to earn the bonus.

Or, if your credit card is about to have extra earnings for a rotating category, you might think about waiting until that time to make a planned purchase.

Note Spending Categories

After signing up for a card, pay attention to how much cash back you’ll earn in different categories if it’s not a flat rate card. That way, you can be sure to use that card exclusively for certain spending categories, or make sure you sign up for rotating categories well within the deadline.

Review Credit Card Terms

Looking over your credit card terms can help to ensure that you know what does and doesn’t count toward earnings. You might also discover through your card’s terms that you can earn enhanced rewards by taking certain actions, such as holding a certain amount of money in an associated bank account.

The Takeaway

A cash-back credit card is a great way to earn rewards that doesn’t necessarily require a complicated redemption process. Even better is when the card doesn’t place limits on the amount of cash-back rewards you can earn, which is the meaning of unlimited cash back.

Still, you’ll need to make sure you avoid carrying a balance and take steps to maximize your rewards to ensure you don’t negate your cash-back rewards earnings.

Looking for an easy way to earn cash back? Check out the SoFi credit card. For a limited time, new credit card holders† who also sign up for a SoFi Checking and Savings with direct deposit can start earning 3% cash back rewards on all eligible credit card purchases for 365 days*. Offer ends 12/31/22.

Take advantage of this offer by applying for a SoFi credit card today.

FAQ

How does unlimited cash back work?

If you have a credit card with unlimited cash back, that means there are no limits on the amount of rewards you can earn through qualifying purchases.

Is unlimited cash back better than points?

Whether cash back or points is better really depends on your preferences. Cash back is straightforward to track and redeem. Meanwhile, points may translate to a greater range of redemption opportunities, including for travel-related purchases. However, the value of points can vary depending on the card and the way the points are redeemed.


Photo credit: iStock/AsiaVision

SoFi cardholders earn 2% unlimited cash back rewards when redeemed to save, invest, or pay down eligible SoFi debt. Cardholders earn 1% cash back rewards when redeemed for a statement credit.1
1See Rewards Details at SoFi.com/card/rewards.
†SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS PROSPECTIVELY BASED ON MARKET CONDITIONS AND BORROWER ELIGIBILITY. Your eligibility for a SoFi Credit Card Account or a subsequently offered product or service is subject to the final determination by The Bank of Missouri (“TBOM”) (“Issuer”), as issuer, 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. Please allow up to 30 days from the date of submission to process your application. The card offer referenced in this communication is only available to individuals who are at least 18 years of age (or of legal age in your state of residence), and who reside in the United States.

*You will need to maintain a qualifying Direct Deposit every month with SoFi Checking and Savings in order to continue to receive this promotional cash back rate. Qualifying Direct Deposits are defined as deposits from enrolled member’s employer, payroll, or benefits provider via ACH deposit. Deposits that are not from an employer (such as check deposits; P2P transfers such as from PayPal or Venmo, etc.; merchant transactions such as from PayPal, Stripe, Square, etc.; and bank ACH transfers not from employers) do not qualify for this promotion. A maximum of 36,000 rewards points can be earned from this limited-time offer. After the promotional period ends or once you have earned the maximum points offered by this promotion, your cash back earning rate will revert back to 2%. 36,000 rewards points are worth $360 when redeemed into SoFi Checking and Savings, SoFi Money, SoFi Invest, Crypto, SoFi Personal Loan, SoFi Private Student Loan or Student Loan Refinance and are worth $180 when redeemed as a SoFi Credit Card statement credit.

Promotion Period: 4/18/2022-12/31/2022

Eligible Participants: All new members who apply and get approved for the SoFi Credit Card, open a SoFi Checking and Savings account, and set up Direct Deposit transactions (“Direct Deposit”) into their SoFi Checking and Savings account during the promotion period are eligible. All existing SoFi Credit Card members who set up Direct Deposit into a SoFi Checking & Savings account during the promotion period are eligible. All existing SoFi members who have already enrolled in Direct Deposit into a SoFi Checking & Savings account prior to the promotion period, and who apply and get approved for a SoFi Credit Card during the promotion period are eligible. Existing SoFi members who already have the SoFi Credit Card and previously set up Direct Deposit through SoFi Money or SoFi Checking & Savings are not eligible for this promotion.

The SoFi Credit Card is issued by The Bank of Missouri (TBOM) (“Issuer”) 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.

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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Can You Pay Rent with a Credit Card?

Can You Pay Rent With a Credit Card?

From everyday purchases to splurges, consumers often turn to credit cards. Some even reach for the plastic to pay the rent. But is paying rent by credit card a good idea? And can you pay rent with a credit card even? The answer to both questions: It depends.

Whether you can pay rent with a credit card largely depends on your landlord’s rules, though there are potential workarounds. But even if you can figure out how to pay rent with your credit card, there are pros and cons to paying rent with a credit card that you’ll want to consider.

Do Landlords Allow Payment by Credit Card?

For renters tempted to reach for the plastic, the first likely question is whether this mode of payment is even accepted. The answer to whether you can pay rent with a credit card will depend on the landlord, though many do not allow it.

The reason many landlords don’t allow it is because accepting credit card payments causes them to incur fees. Due to how credit cards work, credit card transactions are subject to fees that are set by the financial institution that issues the card, the companies that partner with the financial institution (like Visa and Mastercard), and the processor responsible for securing and carrying out the credit card transaction.

The amount of these fees depend on a number of things, including the merchant’s total sales volume and how credit cards are processed. Businesses that process between $10,000 and $250,000 in credit card payments annually pay between 2.87% and 4.35% per transaction, according to Square. This means that if a tenant were to charge $1,000 in rent, the landlord would net about $957 to $971 — unless the cost of credit card processing was extended to the renter in the form of a surcharge. To avoid that bite, some landlords do not permit credit card payments for rent.

Even when a landlord does not allow people to pay rent using a credit card, there may be workarounds via third-party apps. These apps effectively charge renters a fee to convert their credit card payment into a form of payment their landlord accepts. Fees can range from 2.75% to 3% of every rental payment. Additionally, the landlord often has to agree to the arrangement.

Pros of Paying Rent With a Credit Card

There’s a famous old saying: “Just because you can doesn’t mean you should.” But there are some scenarios when charging the rent might make sense. Here are some of the potential pros of paying rent with your credit card.

Flexibility

Rent schedules are typically fairly rigid, with payment due at the same time each month. Though this regular schedule can be a boon for budgeting, it can be challenging for gig workers or anyone else with irregular pay periods that don’t line up with when rent is due.But if a cardholder charges the rent, that money becomes due only when their credit card bill is due, providing greater flexibility on the actual payment date.

However, it’s important to stay strict about honoring your credit card due date. Making late credit card payments can result in credit card interest charges, late fees, and even a hit to one’s credit score.

As such, individuals may want to leverage credit cards for flexibility only if they are sure they’ll have the money available when their credit card payment becomes due. In other words, even if charging rent to your credit card offers more flexibility, it’s still necessary to budget for rent each month.

Earn Rewards

While there are many basic credit cards on the market, there are also cards that reward people for spending. Rewards can come in the form of cash back, points that can be redeemed toward travel and other perks, and airline miles. For those with reward credit cards, paying rent by credit card can represent a great opportunity to rack up spending and earn those perks.

However, it’s important to do the math. Third-party fees or credit card payment surcharges can cancel out any benefit a cardholder may earn, or even ultimately cost more if fees are greater than the reward offering.

Cover Immediate Expenses

If you’re short on cash, paying rent with a credit card can buy you some time. By putting what’s likely one of your largest expenditures on your credit card, you can free up funds for more immediate expenses. Then, you’ll have a bit of time to restock your bank account by the time your credit card bill comes due.

If you do this, however, you’ll want to make sure you’re ready to pay off your credit card balance in full by the end of the month, rather than just the credit card minimum payment. Otherwise, you’ll end up accruing interest on top of the money you’ll still owe for rent.

Also take notice if you regularly charge the rent out of necessity. If you do, this merits taking a closer look into the root causes. You’ll want to figure out how you might address those issues in your monthly budget instead of constantly relying on your credit card for backup.

Cash in on up to $300–and 3% cash back for 365 days.¹

Apply and get approved for the SoFi Credit Card. Then open a bank account with qualifying direct deposits. Some things are just better together.


Cons of Paying Rent With a Credit Card

Charging the rent can be a risky proposition, given what a credit card is. Here are additional reasons why paying rent with a credit card may not be a good idea.

There May Be Extra Fees

As discussed, some landlords and third-party payment companies may tack on a surcharge for credit card payments. Let’s say the surcharge is 3%, or an extra $30 on $1,000 in monthly rent. While that may not sound like much, it adds up to $360 a year — money some individuals may prefer to spend elsewhere.

Landlord surcharges aren’t the only cost that can make it more expensive to pay rent by credit card. Making a credit card payment even a day late can increase the total amount due, thanks to interest charges and late fees. And the later the debt — in this case, rent — is paid off in full, the more interest that will accrue.

Though interest rates vary by credit card, they are often higher than other lending products, like personal loans. The average credit card annual percentage rate is over 21%. Worse, the interest compounds, so each month that cardholders do not pay off the rent in full, they’ll incur interest on both the balance and the interest that has accrued.

It Can Affect Credit Score

If you put your rent on your credit card but then don’t handle your credit card debt responsibly, it could have negative implications for your credit. Behaviors like regularly missing credit card payments can lead you to have a bad credit score, which can have serious repercussions down the road.

Your credit score reflects your creditworthiness, or the risk you pose to lenders. The number (300 to 850 for the FICO® Score and VantageScore models) affects how likely it is for you to be approved for another credit card (or a mortgage or other loan) and the interest rate you’ll have to pay. You may also need to maintain a minimum credit score to rent an apartment.

Because rent tends to be a significant expenditure in most people’s budgets, you’ll want to ensure that you’ll have the funds on hand to pay the balance in full if you do choose to charge the rent.

It Can Increase Your Credit Utilization Rate

Even if you make your payments on time, paying rent with a credit card can still affect your credit score. That’s because scores are based in part on an individual’s credit utilization ratio, which is the proportion of credit being used relative to the total available amount.

When it comes to credit utilization, the lower the better. Individuals with high credit utilization are at risk of hitting their credit limit (which can also ding their credit score). With rent likely making up a large proportion of the average individual’s expenditures, such payments can significantly increase total credit utilization. The same principle applies to other major charges as well, such as if you were to buy a car with a credit card.

Should You Pay Your Rent With a Credit Card?

Whether to pay rent with your credit card ultimately depends on your financial situation. As discussed, there are some major downsides to paying rent with your credit card, such as paying extra fees and potentially harming your credit score. You could even get into a cycle of debt if you charge your rent and then aren’t able to pay off your credit card balance in full to avoid interest charges.

If you do decide to move forward with paying rent with a credit card, proceed with caution. Do the math to make sure the rewards you may earn will actually offset the cost of any fees you’ll incur. Also verify that you’ll have the funds available within your monthly budget to pay off your accumulated credit card balance, especially since a hefty charge like rent can drive up credit utilization.

Steps for Paying Rent With a Credit Card

How you’ll pay rent with a credit card depends on whether your landlord will directly accept credit card payments for rent or whether you’ll need to go through a third-party app.

•   If your landlord does accept credit card payments: In this case, you’ll either pay your landlord directly or through an online payment portal. You’ll need to provide your credit card information, including your account number, expiration date, and CVV number. Make sure to verify the total amount. Also check to see whether there are any fees involved and if so, how much those will run.

•   If you need to go through a third-party app: Renters who need to go through a third party in order to pay rent with a credit card will first need to set up an account with one of the apps that provides this service. Make sure to find out what fees are involved before proceeding. You’ll then complete your credit card transaction through the intermediary, which will then pass along the funds to your landlord, either with a check or directly to their bank account.

Alternatives to Paying Rent With a Credit Card

Paying rent with a credit card is more like a last resort than a go-to option. If you’re wondering how to pay rent when you’re in a bind, here are some alternatives to consider:

•   Borrow money from family or friends: If you’re really in a pinch, consider asking a trusted family member or friend if they can lend you the funds. This will save you interest, and it will also save your credit score from the impact of a hard credit inquiry. Just make sure to reach an agreement about how and when you’ll pay back the money — otherwise, it could negatively affect your relationship.

•   Talk to your landlord: If you’re really struggling to come up with rent for the month, consider reaching out to your landlord. Especially if you’ve been prompt with rent payments in the past, they may be sympathetic and offer a little breathing room. Just make sure to come up with a plan in the meantime, as a break on rent won’t last forever.

•   Reach out to rental assistance resources: Another option for those who are having a hard time making rent payments is seeking out assistance. There might be local nonprofits, charities, or even government groups in your area that can offer help to those in need. You may also look into resources like 211.org or the CFPB.

The Takeaway

Can you pay rent with a credit card? Sometimes. But is it a good idea to pay rent with a credit card? If all of the numbers make sense, it could be. You’ll want to weigh both the potential pros of charging your rent to a credit card, like possibly earning rewards or gaining flexibility, against the downsides, such as possible repercussions for your credit score.

If paying with plastic is tempting, your choice of card can make a big difference in the ultimate benefits you receive. The SoFi Credit Card, for instance, allows you to earn generous cash-back rewards and possibly lower your APR through on-time payments.

For a limited time, new credit card holders† who also sign up for a SoFi Checking and Savings with direct deposit can start earning 3% cash back rewards on all eligible credit card purchases for 365 days*. Offer ends 12/31/22.

Take advantage of this offer by applying for a SoFi credit card today.


†SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS PROSPECTIVELY BASED ON MARKET CONDITIONS AND BORROWER ELIGIBILITY. Your eligibility for a SoFi Credit Card Account or a subsequently offered product or service is subject to the final determination by The Bank of Missouri (“TBOM”) (“Issuer”), as issuer, 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. Please allow up to 30 days from the date of submission to process your application. The card offer referenced in this communication is only available to individuals who are at least 18 years of age (or of legal age in your state of residence), and who reside in the United States.

*You will need to maintain a qualifying Direct Deposit every month with SoFi Checking and Savings in order to continue to receive this promotional cash back rate. Qualifying Direct Deposits are defined as deposits from enrolled member’s employer, payroll, or benefits provider via ACH deposit. Deposits that are not from an employer (such as check deposits; P2P transfers such as from PayPal or Venmo, etc.; merchant transactions such as from PayPal, Stripe, Square, etc.; and bank ACH transfers not from employers) do not qualify for this promotion. A maximum of 36,000 rewards points can be earned from this limited-time offer. After the promotional period ends or once you have earned the maximum points offered by this promotion, your cash back earning rate will revert back to 2%. 36,000 rewards points are worth $360 when redeemed into SoFi Checking and Savings, SoFi Money, SoFi Invest, Crypto, SoFi Personal Loan, SoFi Private Student Loan or Student Loan Refinance and are worth $180 when redeemed as a SoFi Credit Card statement credit.

Promotion Period: 4/18/2022-12/31/2022

Eligible Participants: All new members who apply and get approved for the SoFi Credit Card, open a SoFi Checking and Savings account, and set up Direct Deposit transactions (“Direct Deposit”) into their SoFi Checking and Savings account during the promotion period are eligible. All existing SoFi Credit Card members who set up Direct Deposit into a SoFi Checking & Savings account during the promotion period are eligible. All existing SoFi members who have already enrolled in Direct Deposit into a SoFi Checking & Savings account prior to the promotion period, and who apply and get approved for a SoFi Credit Card during the promotion period are eligible. Existing SoFi members who already have the SoFi Credit Card and previously set up Direct Deposit through SoFi Money or SoFi Checking & Savings are not eligible for this promotion.

1See Rewards Details at SoFi.com/card/rewards.
SoFi cardholders earn 2% unlimited cash back rewards when redeemed to save, invest, or pay down eligible SoFi debt. Cardholders earn 1% cash back rewards when redeemed for a statement credit.1
*See Pricing, Terms & Conditions at SoFi.com/card/terms
The SoFi Credit Card is issued by The Bank of Missouri (TBOM) (“Issuer”) 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.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Third-Party Brand Mentions: No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
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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How Does a Balance Transfer Affect Your Credit Score?

How Does a Balance Transfer Affect Your Credit Score?

A credit card balance transfer can be a beautiful thing. By transferring existing high-interest debt to a credit card with no or low interest, you can save money and make it easier to pay off your debt. It can also have an impact on your credit score.

How, exactly, does balance transfer affect your credit score? A balance transfer can affect your credit score either positively or negatively — though the upsides are likely to outweigh any adverse effects in the long-term if you manage the balance transfer responsibly.

How Does a Balance Transfer Work?

A balance transfer is the process of consolidating existing high-interest debt to a different credit card. In other words, you’re effectively paying a credit card with another. Usually, you transfer the balance to a new credit card, but some cards allow you to do a balance transfer to an existing card.

Balance transfer credit cards often offer a low, or even 0%, annual percentage rate (APR) for a promotional period. This temporarily lowers the credit card interest rate, potentially allowing you to save on interest and more quickly pay off your debt. The length of the introductory APR offer varies by card, usually lasting anywhere from six to 21 months, after which the standard purchase APR will apply.

There is usually a fee required to make a balance transfer. This fee is either a flat rate or a percentage of the balance you’re transferring, such as 3% to 5% of your balance.

Recommended: How to Avoid Interest On a Credit Card

Cash in on up to $300–and 3% cash back for 365 days.¹

Apply and get approved for the SoFi Credit Card. Then open a bank account with qualifying direct deposits. Some things are just better together.


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

When to Transfer the Balance on Your Credit Card

There are two key things to look for in order to identify an opportune time for a balance transfer. First, you’re approved for a balance transfer card that offers a 0% APR introductory period. Second, you’re in a place where you can focus on paying off the balance you transfer to your new card before the promotional period ends.

It’s important to work aggressively on eliminating your balance during this period. Otherwise, once the promotional APR kicks over to the usual APR, the interest rate could potentially be as high — if not higher — than the APR of your old card.

How a Balance Transfer May Hurt Your Credit Score

If you’re contemplating a balance transfer, you might be wondering: Does a balance transfer affect my credit score? While a balance transfer itself won’t directly impact your credit score, opening a new balance transfer card could have a ripple effect on your credit. A balance transfer to an existing credit card may not affect your credit score as much as opening a new account.

Let’s take a look at a couple of the ways a balance transfer could cause your credit score to drop:

•   Applying for new credit results in a hard inquiry. Whenever you apply for a credit card, the credit card issuer will do a hard pull of your credit, which usually lowers your score by a few points. Hard inquiries stay on your credit report for two years. That being said, when compared to what affects your credit score on the whole, hard inquiries don’t impact your credit as much as, say, your payment history or credit utilization.

•   Getting a new card will lower the average age of your credit. Another way that opening a new balance transfer credit could hurt your credit score is by lowering the average age of your credit. The length of your credit history makes up 15% of your score. A longer credit history is an indicator that you’ve taken steps toward establishing credit.

Recommended: When Are Credit Card Payments Due

How a Balance Transfer May Impact Your Credit Score

Now, let’s take a look at how a balance transfer can impact your credit score:

•   It can lower your credit utilization rate. As credit usage makes up a significant chunk of your credit score — 30%, to be exact — a balance transfer could give your credit score a lift. When you open a new credit card account, it will add to your total credit limit, which, in turn, can lower your credit utilization. As a credit card rule, the lower your credit utilization, the better it is for your credit score.

   Here’s an example: Say you have two credit cards, and they each have a $10,000 credit limit, for a total credit limit of $20,000. You’re carrying a $10,000 balance. In turn, your credit usage is 50%.

   Now, let’s say you open a new balance transfer credit card that has a credit limit of $10,000. Combined with your other two cards, you’ll now have a total credit limit of $30,000. With a $10,000 balance, your total credit usage is lowered to about 33%.

•   You may be able to pay down debt faster. As you’re paying less interest — or perhaps no interest at all — during your card’s promotional period, you can more easily whittle away at your outstanding debt quicker. That’s because more of your payments will go toward paying down your principal. Plus, lowering that outstanding balance also feeds into lowering your credit utilization ratio — another positive when it comes to building credit.

•   A balance transfer can make it easier to stay on top of payments. A balance transfer allows you to consolidate multiple balances into one monthly payment. This can make it easier to stay on top of making on-time payments, as you won’t have numerous due dates to juggle. In turn, this can have a positive impact on your payment history, which makes up 35% of your credit score.

Recommended: What is the Average Credit Card Limit

Steps to Take After a Balance Transfer

So you’ve decided to do a balance transfer. Congrats! Now, here are the steps to take to make the most of it.

Stop Using Your Other Credit Cards

If possible, put a halt on spending with your other credit cards. That way, you can focus solely on paying off the outstanding balance you’ve transferred.

Still, you’ll want to keep your other cards open. You might consider using a credit card to make a small purchase every so often to keep those accounts active.

Know When the Introductory Period Ends

Make sure you’re aware of when the introductory APR for your balance transfer card ends. Also take time to note what the balance transfer card’s standard APR is. When the promotional APR ends, that rate is what your new APR will be.

Devise a Payoff Plan

A balance transfer is really only worthwhile if you aim to pay off your outstanding debt — or as much of it as possible — during the promotional APR period.

Let’s say you have $6,000 in debt, and you’ve secured a 0% APR that will last for 12 months. Aim to pay off $500 every month, or $250 twice a month. That way, you’ll have your debt paid off before the higher APR kicks in.

Make Shifts in your Spending

To ensure that you’re paying off the outstanding amount on your balance transfer card at a steady clip, look at ways you can scale back on your spending. Doing so will free up money that you could throw at your debt payoff efforts instead.

Along the same lines, see if you can increase your cash flow. Perhaps you can take on more hours at work or get a side hustle.

Is a Balance Transfer a Good Idea?

A balance transfer can be a solid move to make if you’re prepared to knock off the debt before the introductory APR period ends. Otherwise, you’re left with a mountain of debt — potentially with a higher interest rate than you currently have.

When deciding whether a balance transfer is right for you, you’ll also want to take into account any balance transfer fees you’ll pay. Do the math to ensure the amount you’ll save on interest will more than offset the cost of these fees.

Also note that, before you worry about balance transfer effects on your credit score, you’ll need to consider whether your credit is even strong enough for you to qualify. The most competitive balance transfer offers generally require at least good credit (meaning a FICO score of 670 or above), further underscoring the importance of good credit.

If you’re not sure of where you stand credit-wise, don’t worry about taking a peek: here’s how checking your credit score affects your rating (spoiler: it doesn’t).

Recommended: Can You Buy Crypto With a Credit Card

Balance Transfers and Credit Scores: The Takeaway

A balance transfer can both hurt and help your credit score. Your credit score could temporarily suffer after applying for a new balance transfer card. However, a balance transfer has the potential to help your credit score, as it can lower your credit utilization rate and make it easier for you to stay on top of your payments.

If you’re on the hunt for a new credit card, consider the SoFi Credit Card. Aside from offering cash-back rewards for purchases, the SoFi Credit Card rewards cardholders for making on-time payments. After making 12 monthly on-time payments of at least the minimum payment due, SoFi will lower your APR by 1%. Learn more and apply for a credit card today with SoFi.

Find out if you qualify for a SoFi Credit Card today!

FAQ

Do balance transfers hurt your credit score?

Balance transfers can either hurt or help your credit score. Making a balance transfer can hurt your credit score if you apply for a new card to do so, which requires a hard pull of your credit. It can also ding your score because it may lower the average age of your credit lines.

Will I need a credit credit score for a balance transfer?

To qualify for a balance transfer card with a zero or low interest rate, you’ll need a strong credit score. A good credit score is generally considered in the range of 670+.

Will I lose points with a balance transfer?

You will not lose rewards points with a balance transfer. That’s because your old creditor will generally consider the balance transfer as payment.

What are the negatives of a balance transfer?

Getting a balance transfer credit card can bring down your credit score if it requires a hard inquiry on your credit report. Plus, it can lower your average credit age. Another downside of a balance transfer is that you’ll need to pay a balance transfer fee, which is either a flat rate or a percentage of the outstanding amount.


Photo credit: iStock/Roman Novitskii

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s
website
.

The SoFi Credit Card is issued by The Bank of Missouri (TBOM) (“Issuer”) 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.
1See Rewards Details at SoFi.com/card/rewards.
SoFi cardholders earn 2% unlimited cash back rewards when redeemed to save, invest, or pay down eligible SoFi debt. Cardholders earn 1% cash back rewards when redeemed for a statement credit.1
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Guide to Credit Card Food Delivery and Ride Sharing Discounts

Guide to Credit Card Food Delivery and Ride Sharing Discounts

The best credit cards for food delivery and ride sharing offer a host of benefits, including generous cash-back rewards, free annual memberships, and annual credits on these services. While food delivery and ride sharing credit cards can have some downsides — like high annual fees, in some cases — the positives might outweigh the negatives for those that often order delivery or use ridesharing.

Depending on which type of service you use, the process of claiming your earned rewards can be quick and easy. Often, it’s as simple as linking the eligible credit card to your account.

Recommended: Can You Buy Crypto With a Credit Card

What Are Rewards Credit Cards?

Rewards credit cards offer benefits in exchange for every dollar you spend on the card, typically as cash back, points, or airline miles. You can then redeem the credit card rewards you’ve earned in a variety of ways, such as in the form of a check, a statement credit, travel perks, or gift cards.

While not all rewards credit cards have annual fees, those with higher annual fees tend to offer more generous benefits. Further, rewards credit cards generally have higher annual percentage rates (APR) than more basic credit cards. This makes it all the more important to adhere to the credit card rule of avoiding carrying a balance when possible.

In general, you’ll need a good or excellent credit score (meaning 670+) to qualify for the top rewards credit cards.

Recommended: How to Avoid Interest On a Credit Card

Cash in on up to $300–and 3% cash back for 365 days.¹

Apply and get approved for the SoFi Credit Card. Then open a bank account with qualifying direct deposits. Some things are just better together.


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

How Do Food Delivery Benefits Work?

The way food delivery benefits typically work is that a credit card provider partners with a popular food delivery service. Then, cardholders receive certain credit card benefits, such as free memberships, higher points accrual when using the service, or statement credits on food deliveries.

Which services are paired with your card and the benefits you receive will depend on the credit card provider. In some cases, rewards include a higher rate of cash-back rewards in more general categories, such as takeout or dining. Check your credit card’s website to see what — if any — food delivery benefits are available to you.

How Do Ride Sharing Benefits Work?

Ride sharing benefits are fairly similar to food delivery benefits. Credit card providers partner with ride sharing services to provide benefits for certain credit cards they offer. For instance, there are Lyft credit cards and Uber credit cards that offer perks with those ride sharing services.

Those benefits may come in the form of higher point accruals, statement credits, and free subscriptions. Some cards also offer these benefits in the form of more generic travel credits or cash-back rewards, which may apply to ride sharing services.

Pros and Cons of Using Credit Cards for Food Delivery

Using a credit card for food delivery can have its pros and cons, depending on the credit card you’re using and your own spending habits. Here are some of the advantages and drawbacks of food delivery credit cards to consider:

Pros

Cons

Higher rewards rates for food-related spendingCould carry high annual fees, which might not be worthwhile for occasional users
Can cover membership fees for a period of timeMay have a higher purchase APR
May offer general dining creditsCan tempt cardholders to spend more on takeout due to card’s benefits

Pros and Cons of Using Credit Cards for Rideshare Expenses

Are you thinking about a ride sharing credit card? Here are some pros and cons to consider for these cards:

Pros

Cons

Higher rewards rates on rideshare spendingCan place limits or deadlines on offers or rewards redemptions
May offer travel credits that can apply to rideshare costsMay have high annual fees
Often provide nice benefits across-the-board, such as travel insuranceCould be limited to earning rewards or credits with a particular service

Activating Your Credit Card Offers

Each credit card is different, but activating your offers shouldn’t be too difficult. In some cases, it’s as simple as signing up for the relevant service and linking your credit card to it.

In other cases, you might have to manually activate offers on the service’s app or website. Usually, if your card includes a free membership, it must be manually activated.

Keep in mind that food delivery and ride sharing credit cards often run promotions, and these do expire. For example, the Chase Sapphire Reserve previously included a Lyft Pink membership, but that offer expired in early 2022. However, this card also includes one free year of DoorDash’s DashPass, which is good until the end of 2024.

Using a Credit Card for Food Delivery

Using a credit card for food delivery is a simple process. The first thing you’ll want to do is to create an account on the app, which should only take a couple of minutes. Likewise, add your credit card if you have not already done so.

If you already have an account, you may want to make your rewards credit card the default payment method to take advantage of discounts and rewards. Also make sure to activate any free memberships that might be available to you.

Then, you can search restaurants on the food delivery app, either using your address or your smartphone’s location. These apps often have food categories to make your search a little bit easier.

Once you find something that sounds good, you can add items to your cart and check out. Since you have already added your rewards credit card, use it as your payment method to take advantage of those rewards. And if you use your credit card frequently, it can help you earn your credit card welcome bonus.

Recommended: When Are Credit Card Payments Due

Using a Credit Card for Ride Sharing

Using a credit card for ride sharing will follow all of the same principles as using one for food delivery. Make sure you add your rewards credit card and activate your membership if one is available.

The biggest difference when using a credit card for ride sharing is the process of booking the ride itself. Generally, you book a ride by specifying the pick-up and drop-off locations; ride sharing apps can usually use your smartphone’s location as the pickup.

The app will then find a driver for you and give you the chance to select or change your payment method. If you have a rewards credit card, make sure it appears as the payment method. If it doesn’t, select it before confirming your ride. Once you do that, you’re all set.

The Takeaway

Food delivery credit cards and ride sharing credit cards can offer a slew of perks, including cash-back rewards, statement credits, and free memberships for a few months or even a year. Credit card owners can take advantage of these rewards when hailing a ride or ordering food through a delivery app.

If you want these perks and more, the cash-back rewards credit card from SoFi is a strong contender. It offers perks for both ride sharing and food delivery through World Elite Mastercard® Benefits. This includes Lyft $5 monthly credits and a three-month free trial of DashPass.

Learn more and apply today for a credit card with SoFi!

FAQ

What is credit card dining?

Credit cards can offer a variety of perks when you spend on dining. That could include high cash-back rates when eating at restaurants or ordering delivery. Other credit cards come with free memberships for delivery apps for a set time period or a statement credit for orders.

Are the best cards for rideshare expenses also the best cards for food delivery?

Some credit cards that are the best for rideshare can also be the best for food delivery. However, some credit cards work well for ridesharing because they are travel credit cards, and this may not carry over to food delivery.

Do rideshares count as travel for credit cards?

It depends on the credit card. Some credit cards consider rideshares as travel and will let you earn a higher cash-back rate when booking a ride, for example. However, you should check the details of your card to be sure, as each card is different.


Photo credit: iStock/RgStudio

1See Rewards Details at SoFi.com/card/rewards.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s
website
.

The SoFi Credit Card is issued by The Bank of Missouri (TBOM) (“Issuer”) 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 cardholders earn 2% unlimited cash back rewards when redeemed to save, invest, or pay down eligible SoFi debt. Cardholders earn 1% cash back rewards when redeemed for a statement credit.1
Third-Party Brand Mentions: No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
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What Does 2% Cash Back Mean? Is It Worth It?

What Does 2% Cash Back Mean? Is It Worth It?

Who doesn’t like a bit of extra cash in their pocket? And earning money from spending you’re already doing is arguably even better. If you prefer cash-back rewards with your credit cards, a card that features a 2% cash back flat rate — meaning 2% back on all purchases — can be a solid way to reap rewards.

Let’s go over the ins and outs of what 2% cash back actually means, as well as the pros and cons of a 2% cash-back credit card, to help you determine whether it’s worth your while.

Recommended: Can You Buy Crypto With a Credit Card

What Is Cash Back?

Cash back is a form of reward that cash-back credit cards offer that allows you to earn money back on purchases you make. Other examples of credit card rewards include points or travel miles.

With a flat-rate cash-back card, all of your purchases earn the same amount in cash back. Other credit card issuers might offer higher cash-back rates on certain spending categories, such as on gas or groceries.
Meanwhile, some may feature rotating bonus categories to give your rewards-earning abilities a boost. For example, you might earn 5% cash back in the fall months on purchases made at restaurants and on gas.

You can redeem the cash-back rewards you earn in the form of a check, bank transfer, or gift card, or as a statement credit. Other options might include making a charitable donation or making a purchase through the issuer’s online portal. Depending on the credit card, there might be a spending threshold you need to meet before you can redeem your cash-back rewards.

Cash in on up to $300–and 3% cash back for 365 days.¹

Apply and get approved for the SoFi Credit Card. Then open a bank account with qualifying direct deposits. Some things are just better together.


What Is 2% Cash Back?

If you’re wondering, ‘What does 2% cash back mean exactly?,’ here’s how it works. Earning 2% cash back simply means that for every $100 you spend on your credit card, you’ll get $2 back. So if you were to spend $1,000, that’s $20 back in your pocket — though you’ll then have to redeem that cash back in order to make the rewards usable.

How 2% Cash-Back Credit Cards Work

As mentioned previously, having a 2% cash-back credit card means you’ll earn 2 cents back for every $1 you spend using the card, or $2 for every $100, and so forth.

There might not be a limit to how much you can earn in cash back. However, in other cases, the card may cap the amount of cash-back rewards you can earn for either regular spending or spending in bonus categories.

Pros and Cons of 2% Cash Back

While a 2% cash back card does come with some advantages, there are some drawbacks as well. Let’s take a look at both:

Pros and Cons of a 2% Cash Back Card
ProsCons
Easy to useHigher APRs compared to non-rewards credit cards
Can rack up rewards quicklyEarning caps may apply
Often no annual feeDon’t often offer travel rewards or perks

Pros

•   Easy to use: A major benefit of a 2% cash-back credit card is that the rules are simple: You spend money, and get a certain amount back. Plus, redeeming rewards is usually pretty straightforward, and you have a choice of how to do so.

•   Can rack up rewards quickly: If you use your credit card for everyday purchases, you’ll accrue rewards fairly fast. Of course, only put everyday purchases on your card if you can afford to pay them off, and always use your card responsibly, considering what a credit card is and the implications overspending can have for your credit score.

•   Often no annual fee: Many cash-back cards don’t have an annual fee. That means you won’t need to worry about spending enough to offset the fee.

Cons

•   Higher APRs compared to non-rewards credit cards: While your annual percentage rate (APR) on a card partly depends on your credit and other financial factors, rewards credit cards like cash-back cards tend to carry higher interest rates. If you keep a balance on your account, you can expect to pay a pretty penny in interest, given how credit cards work.

•   Earning caps may apply: While some credit cards allow you to earn unlimited cash-back rewards, others place a limit on how much you can earn. If you’re looking to max out your rewards potential, a cap could make that harder to do.

•   Don’t often offer travel rewards or perks: If you’re hoping to earn rewards that apply to travel, such as airline trips or hotel stays, a cash-back credit card likely isn’t the form of rewards credit card for you. While some cards may offer travel redemption options, most don’t, and many also charge foreign transaction fees.

Recommended: When Are Credit Card Payments Due

Is a 2% Cash Back-Credit Card Worth It?

Whether a 2% cash-back credit card is worth it really depends on how you’ll use the credit card. This includes what types of purchases you’d like to make, and if you plan on using your card for bills and everyday expenses, such as gas and groceries. If you use the credit card regularly, you’ll be able to earn a greater amount of cash-back rewards.

However, you’ll also want to balance that spending with sticking to important credit card rules, like not spending more than you can afford to pay off. Because rewards credit cards tend to have higher interest rates, it’s important to avoid carrying a balance so you don’t cancel out the cash back you earn.

A cash-back rewards card might not be worth it if you prefer to use your credit card rewards for travel. In that case, a travel rewards credit card typically will offer more lucrative ways to earn points or miles to use on trips.

Recommended: How to Avoid Interest On a Credit Card

Guide to Using a 2% Cash-Back Credit Card

If you get a 2% cash-back card, here are some tips to keep in mind to use it effectively:

•   Read the redemption rules. Familiarize yourself with credit card requirements, and see if there are any limits on how much cash back you can earn. Similarly, check if you need to hit a minimum amount in cash-back earnings before you can redeem those rewards.

•   Be intentional with your purchases. Devise a plan for how you intend to use your cash-back credit card. Perhaps you would prefer to use it on big-ticket items, or maybe on seasonal purchases, such as during the holidays or back-to-school season. This will help you make the most of your card.

•   Choose how you’ll receive your rewards. You’ll also want to decide whether you plan on receiving the cash-back in the form of an ACH transfer to your account, as statement credit, or as a check dropped in the mail. You also might be able to use your rewards by making online purchases through the credit card’s shopping portal, or by purchasing gift cards or donating to charity.

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

Maximizing 2% Cash-Back Earnings

If you have a cash-back credit card, it’s worth your while to take the time to determine how to maximize your earnings. Here are several ways to do so.

Use Your Card For Everyday Purchases and Bills

Consider using your cash-back card on major spending categories to earn the most on rewards. For example, if you spend $4,500 a year on food for you and your family and put all of your groceries and dining expenses on your card, you’ll get $90 in cash-back on just that spending alone.

You might also consider putting your recurring bills and subscription services on your credit cards. This will allow you to scoop up points in areas you already spend.

Just make sure you aren’t spending beyond your means. Keep an eye on your expenditures, and commit to paying off your balance in full each month.

Put Big-Ticket Buys on Your Card

If you’ve been saving up for a sleek new laptop or coveted designer shoes, consider putting that cost on your 2% cash-back card. That way, you can get the item and earn a bit of cash back on the purchase.

Your card may even come with added perks, such as purchase protection or an extended manufacturer’s warranty.

Look for a Card With No Annual Fee

A card without an annual fee means you won’t need to spend as much to make the cash-back rewards worthwhile. Case in point: If you get a card with a $40 annual fee, you’ll need to put $2,000 in purchases to break even at a 2% cash-back rewards rate.

Pay Off Your Balance in Full Each Month

As cash-back credit cards tend to have higher APRs, make it a point to pay off your card in full. This will help you avoid racking up interest charges, which can cut into the cash-back rewards you earn.

Recommended: What is a Charge Card

Strategize When You’d Like to Redeem Your Cash Back

To maximize your 2% cash-back rewards card, it helps to be intentional with how you choose to redeem your cash-back rewards as well as when you do so. For instance, if you tend to dig a debt hole during the holidays, use your rewards to pay for gifts and other related expenses. Or, you can put the rewards you’ve accumulated toward a statement credit, or redeem it for a gift card for your loved one.

Get Cash-Back Rewards With the SoFi Credit Card

In the market for a credit card? You can earn generous credit card rewards with SoFi. For a limited time, new credit card holders who also sign up for a SoFi Checking and Savings with direct deposit can start earning 3% cash back rewards on all eligible credit card purchases for 365 days*. Offer ends 12/31/22.

Learn more and apply for a SoFi Credit Card today!

FAQ

Is 2% cash back good for credit cards?

A 2% flat-rate, cash-back credit card can be a strong choice as a go-to credit card if you intend to use your card for everyday spending. Earning rewards at a flat rate and in this manner is simple and straightforward, as you don’t have to worry about keeping track of rotating categories or figuring out point conversion values.

Is 2% cash back better than points?

A 2% cash back credit card is a no-hassle, straightforward way to earn rewards. While you might earn more points on a travel card, redemption values and ways to redeem points on a travel rewards card can be more complicated. A flat-rate cash-back card can be a good choice to use as a foundation. Then, you can also open a travel card if it makes sense for your needs.

Does the SoFi credit card give 2% cash back?

For a limited time, new credit card holders who also sign up for a SoFi Checking and Savings with direct deposit can start earning 3% cash back rewards on all eligible credit card purchases for 365 days*. Offer ends 12/31/22. Otherwise, cardholders earn 2% unlimited cash back rewards when redeemed to save, invest, or pay down eligible SoFi debt. Cardholders earn 1% cash back rewards when redeemed for a statement credit.1


Photo credit: iStock/LaylaBird
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.

The SoFi Credit Card is issued by The Bank of Missouri (TBOM) (“Issuer”) 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.
1See Rewards Details at SoFi.com/card/rewards.
SoFi cardholders earn 2% unlimited cash back rewards when redeemed to save, invest, or pay down eligible SoFi debt. Cardholders earn 1% cash back rewards when redeemed for a statement credit.1
You will need to maintain a qualifying Direct Deposit every month with SoFi Checking and Savings in order to continue to receive this promotional cash back rate. Qualifying Direct Deposits are defined as deposits from enrolled member’s employer, payroll, or benefits provider via ACH deposit. Deposits that are not from an employer (such as check deposits; P2P transfers such as from PayPal or Venmo, etc.; merchant transactions such as from PayPal, Stripe, Square, etc.; and bank ACH transfers not from employers) do not qualify for this promotion. A maximum of 36,000 rewards points can be earned from this limited-time offer. After the promotional period ends or once you have earned the maximum points offered by this promotion, your cash back earning rate will revert back to 2%. 36,000 rewards points are worth $360 when redeemed into SoFi Checking and Savings, SoFi Money, SoFi Invest, Crypto, SoFi Personal Loan, SoFi Private Student Loan or Student Loan Refinance and are worth $180 when redeemed as a SoFi Credit Card statement credit.

Promotion Period: 4/5/2022-12/31/2022. SoFi reserves the right to exclude any Member from participating in the Program for any reason, including suspected fraud, misuse, or if suspicious activities are observed. SoFi also reserves the right to stop or make changes to the Program at any time.

Eligible Participants: All new members who apply and get approved for the SoFi Credit Card, open a SoFi Checking and Savings account, and set up Direct Deposit transactions ("Direct Deposit") into their SoFi Checking and Savings account during the promotion period are eligible. All existing SoFi Credit Card members who set up Direct Deposit into a SoFi Checking & Savings account during the promotion period are eligible. All existing SoFi members who have already enrolled in Direct Deposit into a SoFi Checking & Savings account prior to the promotion period, and who apply and get approved for a SoFi Credit Card during the promotion period are eligible. Existing SoFi members who already have the SoFi Credit Card and previously set up Direct Deposit through SoFi Money or SoFi Checking & Savings are not eligible for this promotion.

New SoFi Checking and Savings customers and existing Checking and Savings customers without direct deposit are eligible to earn a cash bonus when they set up direct deposits of at least $1,000 over a consecutive 30-day period. Cash bonus will be based on the total amount of direct deposit. Entry into the Program will be available 4/5/22 to 5/31/22. Full terms at sofi.com/banking. SoFi Checking and Savings is offered through SoFi Bank, N.A. Member FDIC.

SoFi members with direct deposit can earn up to 2.00% annual percentage yield (APY) interest on all account balances in their Checking and Savings accounts (including Vaults). Members without direct deposit will earn 1.00% APY on all account balances in Checking and Savings (including Vaults). Interest rates are variable and subject to change at any time. Rate of 2.00% APY is current as of 08/12/2022. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet.

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