Investing With Credit Card Rewards: Tips for Maximizing Cash Back Earnings

Responsible credit card usage can add hundreds if not thousands of extra dollars to your bottom line each year. Many credit cards offer rewards that you can earn with each and every purchase. You can choose a credit card that helps you earn airline miles, travel rewards, or cash back.

Before applying for or using a credit card, you’ll want to make sure that you have the financial ability and discipline to pay off your credit card statement in full, each and every month. If you don’t, the interest and/or fees will likely exceed any rewards you might earn. But if you do, you might consider investing with credit card rewards to further grow your funds.

Recommended: Tips for Using a Credit Card Responsibly

What Are Credit Card Rewards?

Just like knowing what a credit card is, it’s important to understand what credit card rewards are. Many credit card companies offer credit card rewards as an incentive for you to apply for and regularly use their credit card.

These rewards can be airline miles, other types of travel rewards, bank-specific points, or straight cash back. The credit card you choose determines the kind of credit card rewards that you’ll earn.

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

Types of Credit Card Rewards

If you have a rewards credit card, there are several different kinds of credit card rewards that you can earn.

Cash Back Rewards

If you have a cash back credit card, you’ll earn cash back with every purchase. Some cash back credit cards earn different rates of cash at different types of merchants, while others earn a flat cashback rate no matter where you use the card.

Travel Rewards

Another popular type of credit card rewards are a variety of different kinds of travel rewards. You might get an airline credit card that earns airline miles for a specific airline or hotel points good for stays at a particular chain of hotels. Other travel rewards credit cards offer rewards points that you can use at a flat rate on any type of travel purchase.

Bank Points

Some banks offer credit cards where you earn points that are proprietary to that bank or credit card company. Many times, these points can be used like cash on purchases, or for travel-related purchases.

Guide to Investing Your Credit Card Cash Back Rewards

If you have a credit card that earns cash back rewards, you can often redeem them in many different ways.

Direct Deposit

One way to get your credit card cash back rewards is through direct deposit to a checking or savings account that you own. You might set up your cash back rewards to automatically transfer to your account once they reach a certain threshold, like $25. You might also be able to set up your account to regularly transfer your cash back rewards every month or every quarter.

Paper Checks

If you prefer something that you can tangibly hold, you can also request that your credit card cash back rewards are mailed to you via a paper check. Some credit card companies may charge a fee for mailing paper checks, so make sure you won’t be charged a fee before choosing this option.

Recommended: What is a Charge Card

Statement Credits

Another way you might access your cash back rewards is through a statement credit. With a statement credit, your cash back rewards are applied directly to your credit card balance. This will lower the amount that you need to pay in order to completely pay off your balance off in full.

How Do Credit Card Rewards You Can Use for Investing Work?

Before using one, it’s important to understand how credit cards work, and how credit card rewards that you can use toward investing work. An investment credit card is similar to a cash back credit card in that you earn rewards that work like cash. But instead of redeeming your rewards for a statement credit or via direct deposit, you invest your cash back rewards in an investment account.

Tips for Maximizing Your Credit Card Cash Back Reward Earnings

Enjoying credit card bonuses is one way that you can maximize your credit card cash back earnings.
Many credit cards offer an initial welcome offer where you get a bonus amount if you meet certain spending or other criteria in the first few months of having the card. That can really supercharge your credit card cash back reward earnings.

If your cash back credit card earns a higher rate in certain categories or at certain merchants, make sure to use it where it gets the highest value.

Recommended: Can You Buy Crypto With a Credit Card

Pros and Cons of Investing Your Credit Card Cash Back Rewards

Here is a look at some of the pros and cons of investing your credit card cash back rewards:

Pros of Investing Your Credit Card Cash Back Rewards Cons of Investing Your Credit Card Cash Back Rewards
Cashback and other rewards are not taxable. If you’re not paying off your balance in full each month, interest and fees can offset any rewards earned.
Investing your rewards can help supplement other investing efforts. It’s hard for small amounts to make a meaningful impact on overall investing goals.
Investing your credit card rewards doesn’t require dipping into your budget. If your brokerage doesn’t support fractional shares, your investment options might be limited.

Recommended: How to Buy Stocks With a Credit Card

Other Investment Options

One of the best things about the cash that you earn from cash back rewards is that it’s actually cash. Cash can be used for just about anything in your budget, and so can cash back rewards.

For example, you can use your cash back rewards in an online trading platform to invest in stocks or index funds. You can also use them to invest in real estate or other types of investments, or even use them to invest in yourself through education or job training classes.

Recommended: Can You Buy Crypto With a Credit Card

The Takeaway

If used wisely, credit cards and credit card rewards can serve as a valuable addition to any financial plan. Cash back credit cards allow you to earn money back on every purchase, as well as possibly a larger initial bonus. It’s a good idea to have a plan for how you want to use your cash back rewards, and always make sure to pay off your credit card statement in full, each and every month.

One way to use credit card rewards to fund your investments is to get a cash-back credit card like the SoFi Credit Card.

FAQ

Should you invest your cash back rewards?

One of the best things about cash back rewards is that they function pretty much the same as cash in any other format. So whether you directly invest your cash back rewards or use them as a statement credit and invest money from your checking account, it works out pretty much the same. The important thing to do with your credit card rewards is to not spend them mindlessly. Be intentional and make a conscious decision on the best way to spend them for your specific financial situation.

Can I buy stocks with my credit card?

Most brokerages will not allow you to directly buy stocks with a credit card. Instead, one way to invest your credit card rewards is by using a cash back credit card like the SoFi credit card. You can earn cash back with each purchase and then directly invest those funds with your SoFi Invest account.

What is the smartest way to use a credit card that has rewards?

The first thing that you’ll want to do when using a credit card is make sure that you have the financial discipline and ability to pay off your credit card in full each month. This ensures that you won’t be charged any interest or fees. Then, decide how your credit card rewards will make the biggest impact in your financial life.


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SoFi Invest®

INVESTMENTS ARE NOT FDIC INSURED • ARE NOT BANK GUARANTEED • MAY LOSE VALUE

SoFi Invest encompasses two distinct companies, with various products and services offered to investors as described below: Individual customer accounts may be subject to the terms applicable to one or more of these platforms.
1) Automated Investing and advisory services are provided by SoFi Wealth LLC, an SEC-registered investment adviser (“SoFi Wealth“). Brokerage services are provided to SoFi Wealth LLC by SoFi Securities LLC.
2) Active Investing and brokerage services are provided by SoFi Securities LLC, Member FINRA (www.finra.org)/SIPC(www.sipc.org). Clearing and custody of all securities are provided by APEX Clearing Corporation.
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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.

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.



New and existing Checking and Savings members who have not previously enrolled in direct deposit with SoFi are eligible to earn a cash bonus when they set up direct deposits of at least $1,000 over a consecutive 25-day period. Cash bonus will be based on the total amount of direct deposit. The Program will be available through 12/31/23. 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 4.00% annual percentage yield (APY) interest on Savings account balances (including Vaults) and up to 1.20% APY on Checking account balances. There is no minimum direct deposit amount required to qualify for these rates. Members without direct deposit will earn 1.20% APY on all account balances in Checking and Savings (including Vaults). Interest rates are variable and subject to change at any time. These rates are current as of 3/17/2023. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet


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Credit Card Miles vs. Cash Back: Guide to Choosing Between Cash Back and Travel Rewards

Credit cards often offer rewards to incentivize you to apply for a credit card and use it. Cash back cards and miles cards are two common types of rewards cards. The former gives you cash rewards, while the latter offers miles or points that you can use toward a purchase.

Both types of rewards can end up being quite valuable for cardholders. But how do you decide whether you want to earn miles vs. cash back? Here’s a look at cash back vs. travel rewards cards to help you decide which is right for you.

What Are Points and Miles Credit Cards?

Points and miles credit cards are technically two types of rewards cards, a broader category within what a credit card is. Points cards give you points that you can redeem for things like travel, merchandise, or cash back to reward you for your spending. Generally, a point is worth about $0.01, though that varies by card and, in some cases, what you choose to use your points for. For example, you might earn more points for travel than you do when you redeem your points for gift cards.

Miles cards usually offer airline miles associated with an airline’s frequent flyer program. You can earn them by using a credit card that’s co-branded with a specific airline, or a card that’s a more general travel card. With co-branded cards, you can redeem miles with that airline or their partner airlines. Cards that aren’t co-branded may allow you to use your miles with various airlines.

As with points, airline miles are typically worth about $0.01, though the value of each mile might differ depending on when you book your travel and what type of seat you purchase.

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

Pros and Cons of Points and Miles Credit Cards

Before signing up for a miles or points card, it’s important to consider the advantages and disadvantages.

On the one hand, points and miles cards both offer travel-related perks, though miles cards may only offer travel through specific airlines. Cards may also come with bonuses to help incentivize you to apply for a credit card.

However, miles and points cards may charge a hefty annual fee that helps the credit card company offset the cost of providing the rewards program. With co-branded cards, you typically cannot transfer miles to other airlines. Additionally, the value of your miles may vary according to a variety of factors, such as the date you choose to travel or the seat you want to sit in.

Recommended: What is a Charge Card

Pros of Points and Miles Credit Cards Cons of Points and Miles Credit Cards
Reduce the cost of travel. Can’t transfer miles to another airline loyalty program.
Provide travel-related perks. Value of points and miles may vary.
May come with a sign-up bonus. Points and miles cards may charge large annual fees.

What Are Cash Back Credit Cards?

Cash back credit cards offer you cash as a reward for making purchases with the card. For example, your card might offer you up to 3% cash back on all purchases, which means that for every $100 you spend, you’ll receive $2. Cash back cards usually let you redeem your rewards for cash via statement credit, bank transfer, or check.

Cash back cards can be flat-rate cards, meaning you’ll earn a fixed percentage on every purchase. Or, they worked based on a tiered system. For example, some cards will offer you higher rewards for certain purchases, like travel, groceries, or gas. In some cases, cards may have rotating rewards categories that change every few months.

Related: Enjoying Credit Card Bonuses

Pros and Cons of Cash Back Credit Cards

When you consider a cash back card, again consider potential disadvantages in addition to benefits.
On the plus side, cash back cards typically don’t come with steep annual fees. You can redeem your rewards for cash that you can use for any purpose, and the amount you earn is fixed — the value or your reward doesn’t vary by date or other factors as it might with a miles card.

On the other hand, the amount of cash you can earn may be limited, and these cards may not offer many other perks. Cash back cards also typically don’t come with credit card sign-up bonuses that are as big as those offered by miles and points cards, marking another difference between cash back vs. miles cards.

Recommended: Tips for Using a Credit Card Responsibly

Pros of Cash Back Credit Cards Cons of Cash Back Credit Cards
Usually have no annual fees. May offer lower sign-up bonuses.
Rewards can be redeemed for cash. Cash back cards may offer fewer perks.
The value of your reward is fixed. The amount you can earn may be limited.

Similarities Between Cash Back and Points and Miles Credit Cards

Both cash back and points or miles cards offer you rewards based on your spending, and they may offer higher rewards for spending in certain categories. Be aware that some rewards have expiration dates, as well.

Rewards cards often carry higher-than-average interest rates. As a result, you’ll want to make sure that you will be able to pay off your credit card bill on-time and in full when you use your card, given how credit cards work when it comes to interest.

Recommended: What is the Average Credit Card Limit

Differences Between Cash Back and Points and Miles Credit Cards

The main difference between a cash back credit card vs. miles and points card is how you redeem your rewards. With cash back cards, you received a percentage of your spending, sometimes limited to a maximum amount. You earn points and miles in a similar way. However, their value may change and you may be limited in where you can redeem them.

If you have a co-branded miles card for example, you may only be able to use your miles with that airline. Cards that aren’t co-branded may offer you the chance to redeem points and miles with a variety of companies, such as airlines and hotel brands.

Similarities Between Cash Back and Points and Miles Credit Cards Differences Between Cash Back and Points and Miles Credit Cards
Offer rewards based on spending. Cash back card rewards are redeemed for cash.
May offer greater rewards for spending in certain categories. Points and miles allow you to redeem rewards toward purchases.
Typically has a higher interest rate. Points and miles cards may limit where you can redeem your rewards.

Recommended: How to Avoid Interest On a Credit Card

Is It Better to Get Cash Back or Miles?

Whether or not you choose a cash back card vs. a miles or points card will depend on how much you travel. Travel cards tend to offer better value when you redeem points and miles for travel-related rewards. So if you’re a big traveler, one of these cards may be right for you. However, if you’re more of a homebody, a cash back rewards program may be a better fit.

Other Credit Card Rewards

Cash back or travel rewards isn’t your only choice. There are a variety of other credit card rewards programs you may encounter.

Gas Rewards

Gas cards are typically co-branded with certain gas vendors. Users usually earn points and discounts only on gas purchases. In general, gas cards have relatively high rates of return and don’t charge an annual fee.

Retail Credit Cards

Credit cards that are co-branded with major retail outlets will often offer discounts at that outlet. Rewards might be applied at the point of sale or as regular statement credits.

The Takeaway

Understanding how credit cards allow you to redeem rewards — and how useful those rewards are — is key to deciding which card is right for you. If you’re a world traveler, a miles card might fit the bill. And if you don’t fly frequently, you may be better served by earning cash back on purchases you make in your day-to-day life.

Shop around for the credit card that best suits your needs. A credit card from SoFi offers 2% unlimited cash back rewards and charges no foreign transaction fee. Cardholders earn 1% cash back rewards when redeemed for a statement credit.1

FAQ

What is the difference between cash back and miles?

Cash back cards allow you to earn back a percentage of the purchases you make. Miles cards allow you to earn miles based on the purchases you make, which you often must use toward airline travel.

Is cash back really worth it?

Cash back rewards can allow you to earn some money back from your everyday spending. However, you’ll want to make sure you can pay off your balance in full each month, as rewards cards that offer cash back tend to have higher interest rates than non-rewards credit cards.

Can you convert miles to cash?

Some cards allow you to convert miles to cash, but users will get the most value from redeeming miles for travel. You can find out whether your card allows you to convert miles to cash by calling your credit card issuer. Find their number on the back of your credit card.

Do cash back or credit card miles have higher interest rates?

Both cash back and travel rewards credit cards tend to have higher interest rates as they’re types of rewards credit cards. In general, rewards credit cards usually have higher interest rates than no-frills cards that don’t offer rewards.


Photo credit: iStock/franckreporter

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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6 Examples of When to Use Your Emergency Fund

No doubt, it’s important to save money for a rainy day. But once you’ve stashed some cash away, it can be hard to know what exactly qualifies as a rainy day and gives you license to dip into your savings.

Most of us would agree that being hit with a large, unexpected expense like a medical bill or car repair would be a good reason to tap an emergency fund. But what about a great deal on a used car, which you could really use? Or the opportunity to replace your old fridge at a steep discount? Do those qualify as reasons to dip into your savings?

What Are Things to Avoid Spending My Emergency Savings on?

Let’s say you’ve done a good job creating an emergency fund but aren’t sure when to dip into it. The question is: What types of expenses are valid uses of your emergency fund savings? Here are examples of when not to access that stash of cash.

•   Fun purchases. If you want but don’t need something and it isn’t in your budget, don’t pull from your emergency fund. Entertainment, dining out, tech gadgets, and designer clothes (even if on final sale) are all examples of wants, not needs. Set aside some funds for such buys if you like, but don’t even think about depleting your emergency fund savings. It’s always best to ask questions before making an impulse buy. Spend time thinking about a purchase carefully before making it. You may find that new bike you thought you desperately needed doesn’t seem so vital a day or two later.

•   Vacations. It’s very tempting to get away for a little R&R when things get tough, but a vacation isn’t a worthwhile emergency fund expense. If you want to have that week at the beach, go ahead and create a savings plan and a separate savings account to make it a reality. But it’s not a wise spending strategy to pull the money out of your rainy day funds.

•   Debt. Paying down debt is a great goal. It’s also a great use of any extra money you may have, but not at the expense of draining an emergency fund completely. If you’re chipping away at debt, keep at it but continue to keep some emergency funds aside. If you lose your job or an unexpected expense hits and you don’t have emergency savings, you might end up turning to more expensive forms of credit as a result. This underscores the importance of having an emergency fund.

Earn up to 4.60% APY with a high-yield savings account from SoFi.

Open a SoFi Checking and Savings account and earn up to 4.60% APY - with no minimum balance and no account fees.


How to Know When an Expense Counts as an Emergency

Now, it’s time to consider when to go ahead and use that money you saved for a rainy day. If you’re on the fence about whether an expense counts as an emergency, ask yourself the following six questions to determine if you should tap your emergency funds. Your answers will provide guidance on whether to access your savings.

1. Is This Absolutely Necessary?

There’s a difference between things we want and things we need. If someone starts a new job and they have to buy a uniform for it, that’s a necessity. If, however, someone starts a new job and simply wants some new outfits, that isn’t a necessity. Similarly, pining for a new stove with a commercial-style cooktop is a want; replacing a stove that conked out is a necessity.

2. Is This the Only Way That I Can Pay for This?

Before pulling money from this account, it can be helpful to ask, is the emergency fund the only source of money that can cover this expense? Would it be possible to wait a week until payday and to use that income instead? Gift cards, coupons, and sale discount codes can make it easier to pay for purchases without draining your emergency fund.

Your goal here is to determine the lowest possible price for a purchase and then seeing if there’s another (non emergency fund) way to pay for it.

3. Is This an Unexpected Event?

Emergency funds can be a great way to cover unexpected and necessary purchases, but they aren’t supposed to replace poor planning. If you know a major expense is coming your way (say, the hot-water heater is coming to the end of its lifespan), it’s best to save for it instead of reaching into your rainy day fund.

4. Is This Urgent or Can It Wait?

Even if an expense feels like something that must be dealt with at the moment, there’s a good chance it can be put off. Ask yourself if it can wait until you have saved enough money to pay for it without accessing emergency funds.

5. How Much of My Emergency Fund Will I Be Using?

An emergency fund exists as a safety valve when you unexpectedly need funds. However, before pulling money from an emergency fund, it can be helpful to consider just how much of the emergency fund the purchase will take up. If it’s going to drain the fund and the purchase can wait, it’s likely best to wait. Or maybe you can buy a less pricey version of the item in question.

6. How Long Will It Take To Rebuild My Savings?

If the purchase will take up a big chunk of the emergency savings fund, it can be a good idea to map out how long it will take to rebuild those savings. If it will take more than six months, then it may be best to hold off on making that purchase until the emergency fund is more substantial. It may be better to cut back on spending to cover this expense now without having to touch emergency savings.

Of course, sometimes an emergency is really an emergency, and you can’t hold off. If you are hit with, say, a major medical bill, you may have to use up that emergency fund and work hard to rebuild it later. But it will have done its job and seen you through a tough time.

Banking With SoFi

Before pulling savings from an emergency fund, it’s important to determine if the purchase really is imperative. When deciding what to use emergency funds for, it’s helpful to focus on necessities, not wants. Sometimes, truly urgent needs crop up, and you’ll be glad you had that money saved. Other times, you may realize that the expense that seemed so desperately needed one minute is really not so vital the next. Emergency savings can be a real lifesaver, so you want to protect those funds and make sure you use them properly.

One way to build up an emergency fund faster is to put your money in a savings account that earns interest. When you open an online bank account (SoFi Checking and Savings, to be precise) with direct deposit, you’ll earn a competitive APY that can really help your savings grow! Not to mention, you won’t have to pay any account fees, which can make it easier to save even more for that rainy day.

Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.60% APY on SoFi Checking and Savings.

FAQ

What should you ask yourself before using your emergency fund?

Before you pull money from an emergency fund, ask yourself questions like, Is this expense absolutely necessary? Is this the only way I can pay for it? Is it urgent or can it wait? How much of my emergency savings will I be using up? The answers should guide you towards whether or not it’s worth tapping into your emergency fund.

What should you spend your emergency fund on?

What constitutes an emergency purchase for one person may look quite different for another. That being said, it’s usually best to only spend emergency fund savings on necessities, not wants. These financial emergencies are usually unexpected and may include home repairs, medical bills, and car repairs—or day-to-day expenses after, say, a job loss.

What should you not put in your emergency fund?

While it’s a good idea to put extra money towards an emergency fund instead of spending it on frivolities, there are some types of savings it’s best to leave out of an emergency fund. For example, it’s not a good idea to use 401(k) contributions or other retirement savings to build an emergency fund. Saving for retirement is super important and employers often match 401(k) contributions, which is basically like getting free money. It’s may be wise to focus on maxing out retirement contributions before building an emergency fund.


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

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

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

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

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

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


Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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Guide to Postal Banking

Guide to Postal Banking

A lot of people may not realize all that they can accomplish when running errands at the post office. Not only can they take care of mailing packages and picking up a fresh book of stamps, but in some cases they may be able to pursue financial services too — similar to what one might find at a bank.

Keep reading to learn more about what postal banking (also known as post office banking) entails. Among the topics covered are:

•   What is postal banking?

•   How does postal banking work?

•   What is the Postal Banking Act?

•   Why are some people opposed to postal banking?

•   What are the pros and cons of postal banking?

•   What are alternatives to postal banking?

What Is Postal Banking?

So, exactly what is postal banking? Postal banking involves a post office providing some level of basic financial services similar to a bank. This is a fairly common practice throughout the world, and it used to be common in the U.S. as well.

Many people are currently advocating to bring this service back to the U.S. It could provide a low-cost solution for America’s large unbanked population (aka people who don’t have any bank accounts, let alone multiple bank accounts).

The services that some postal offices offer when conducting postal banking can include things like cashing checks, paying bills, and issuing small loans.

How Does Postal Banking Work?

As briefly noted earlier, when postal banking is in place, a local post office can legally act like a type of bank branch. It may offer some simple banking services like bill payment processing and check cashing. Some post offices may even have the ability to issue small loans.

(It probably won’t have services like international payments via SWIFT system banking, though, or other less common transactions.)

It’s not that common anymore for U.S. post offices to offer services like these, but some do still sell money orders. If someone wants to safely pay a bill or send money to an individual without a checking account, a money order can really come in handy. It’s also possible to cash money orders at post offices in the U.S.

Some people are lobbying for U.S. post offices to expand their services on the financial front and provide more of the services that banks typically do.

The History of Postal Banking

In the past, postal banking in the U.S. was fairly common. Between 1922 and 1967, the Postal Savings System made it possible to deposit money into government-backed, interest-earning accounts at the post office. Eventually, however, commercial banks began to raise their savings account interest rates. With dwindling consumer interest in the Postal Savings System, the program ended in 1967.

In 2014, interest in postal banking in the U.S. began to surge again, thanks to a white paper released by the U.S. Postal Service Office of Inspector General. This white paper garnered a lot of attention after pointing out that underserved, unbanked households spent more than $2,400 a year on average on fees and interest paid by turning to alternative financial sources. The solution to this expensive problem could be postal banking.

Fast forward to October 2021, and the Postal Service teamed up with the American Postal Workers Union to launch a small pilot postal banking program in four cities. At these post offices, customers can access services like bill payments, cash checking, and ATM withdrawals. It’s too early to say if this pilot program will lead to more widespread access to postal banking.

What Is the Postal Banking Act?

The previously mentioned white paper led to a bill known as the Postal Banking Act being sponsored in 2020 by Sen. Kirsten Gillibrand (D-N.Y.) and co-sponsored by Sen. Bernie Sanders (I-Vt.) and Sen. Jeff Merkley (D-Ore.). This act would allow the U.S. Postal Service to provide some basic financial services. As of 2022, this act has been introduced but has not moved onto the next stage of being passed by the Senate.

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Open a SoFi Checking and Savings Account with direct deposit and get up to a $300 cash bonus. Plus, get up to 4.60% APY on your cash!


Why Is There Opposition to Postal Banking?

There is some opposition to bringing back postal banking services in the U.S. One key issue is that some believe the U.S. Postal Service isn’t equipped to handle adding banking services. Opponents argue that these days, plenty of banks have low-cost programs that the unbanked can turn to. They may believe that the U.S. Postal Service should focus on optimizing its core offerings instead of diversifying.

Advantages of Postal Banking

To better understand the possible advantages of postal banking, consider these upsides:

Makes Financial Service More Accessible

For those that are unbanked, postal banking can provide a more affordable and accessible option for financial services. As a result, fewer unbanked individuals would need to turn to expensive alternatives like payday loans and check-cashing stores. They would have a simple way to cash checks and possibly a safe way to transfer funds from one account to another.

Low Cost

Again, postal banking can be more affordable than commercial banking. Sure, all financial institutions need to survive, and fees are how banks make money. But, as previously noted, postal banking can provide a much more affordable alternative to payday loans and check-cashing stores.

Convenient

Regardless of whether a person is unbanked or not, it can be very convenient to, say, cash a check while already running errands at the post office.

Disadvantages of Postal Banking

There are also some downsides of postal banking that need to be taken into consideration. These include:

A Big Undertaking

Some opponents of post office banking believe that the U.S. Postal Service isn’t prepared to launch a nationwide postal banking service. They feel it’s too big of an undertaking to contemplate and could interfere with the day-to-day mail service or other tasks.

Commercial Banking Can Be More Robust

Today, many banks and credit unions have low-cost banking programs that can better serve unbanked consumers. They may help them open personal and business bank accounts at reasonable rates.

How Postal Banking May Help Those Who Are Unbanked

As noted above, many believe that postal banking can make financial services much more affordable and accessible to the unbanked community. This community sometimes turns to pricey, predatory payday loan providers and check-cashing stores. They do so because they don’t have access to commercial banking services. Postal banking would cost less for these consumers and could provide them with options.

Future of Postal Banking in the United States

At this point, the future of postal banking in the U.S. is unclear. Time will tell if postal banking can become more common.

Alternatives to Postal Banking

Because it doesn’t appear that U.S. postal banking will be a common option any time soon, let’s look at some other options consumers have for accessing affordable banking services.

Credit Unions

Credit unions are not-for-profit organizations, so they tend to charge lower fees than commercial banks. This can make them a more affordable option. They also tend to offer higher interest rates on savings products and charge fewer fees in general.

Online Banks

Online banks don’t have the costly overhead associated with running bricks-and-mortar banking locations. They often pass these savings along to their customers by charging fewer and/or lower fees and offering higher interest rates on savings accounts. Online banks can be very accessible since transactions can be done via convenient and safe mobile banking.

Banking With SoFi

What is postal banking? To recap, postal banking — also known as post office banking — occurs when post offices are allowed to offer select financial services to consumers. Postal banking is no longer common in the U.S. and it’s unclear if it will come back anytime soon.

If you’re looking for a new bank that could help your money grow faster, you may want to consider SoFi Checking and Savings. When you open a new bank account online with direct deposit, you can sidestep the usual bank fees, and earn a competitive APY.

Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.60% APY on SoFi Checking and Savings.

FAQ

Why did the postal service stop banking?

The Postal Savings System — a program that made it possible to deposit money into government-backed, interest-earning accounts at the post office (a post office bank account of sorts) — ended in 1967. That’s when commercial banking became more competitive and popular, which contributed to less interest in this program.

Can a post office be a bank?

Currently in the U.S., post offices cannot act as a bank. This may change in the future, thanks to a resurgence in interest in postal banking.

Would postal banking save the post office?

While postal banking may help keep post offices busier and better funded, this isn’t a guarantee. Some opponents to postal banking worry that taking on postal banking may actually be challenging and potentially damaging to the U.S. Postal Service.


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

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

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

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

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

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


SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2023 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.


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.

In our efforts to bring you the latest updates on things that might impact your financial life, we may occasionally enter the political fray, covering candidates, bills, laws and more. Please note: SoFi does not endorse or take official positions on any candidates and the bills they may be sponsoring or proposing. We may occasionally support legislation that we believe would be beneficial to our members, and will make sure to call it out when we do. Our reporting otherwise is for informational purposes only, and shouldn’t be construed as an endorsement.

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Adjusting Your Budget for Working From Home

Adjusting Your Budget for Working From Home

Working from home is more common than ever. What was once a fantastic work perk has become the norm for many occupations. According to the Pew Research Center, 59% of workers who are able to work remotely continue to do so by choice in 2022, even as many others are returning to the office.

If you’re one of those fortunate enough to continue working from home (or have the option to), your budget probably looks a lot different than it used to. Commuting expenses turned into food delivery charges and wardrobe spending turned into exercise subscriptions. You might be trying to keep your home at a comfortable temperature in the middle of the day, which increases the cost of utilities. You may also have substantial costs maintaining a work-from-home office.

If you need to make some adjustments in your work-from-home (WFH) budget, check out these tips.

How Working From Home Affects Your Spending

Working from home changes what you spend money on — and possibly how much you spend every month. You probably expect to save on regular expenses that you no longer have like transportation and lunches out. But you’ll spend more in other areas such as electricity, heat, maybe decorating the space behind your desk chair for video meetings.

Here are some big expenses you may have already incurred:

Home Office Equipment

When you’re regularly working from home, the dining table may not be a great place to set up shop. Also, a chair that is meant for all-day sitting, aka an ergonomic chair, may lessen any stiffness or aching you feel in your back or neck.

If you’re a fantastic scavenger, you might have scored a desk and good chair for free, but most people spend anywhere between $240 to $2,500 on basic office furniture. If you needed to add an office to the existing space in your home via a remodel, you could have paid anywhere between $15,000 and $80,000.

Technology

Your company likely provided a laptop. But connecting it to a larger screen makes work easier on the eyes. And if you have a lot of programs open, two monitors are even better. Likewise, a full-sized keyboard and mouse help reduce the strain on your back and shoulders. And if you video-conference a lot, a ring light, external mic, and wireless headphones can enhance the experience — all of which are likely not offered by your IT department.

Fitness Equipment

If you’re not going out to work out in the gym, you may have invested in some fitness equipment such as an indoor exercise bike or treadmill as well as subscriptions for your at-home workouts.

Steps for Adjusting Your Work From Home Budget

More than two years into working from home (if you started when the pandemic did), you’ve likely made any big office furniture and technology purchases already. So now you just need to figure out how much more or less you are regularly spending. These steps can help:

Track current and pre-pandemic home and home-office expenses

Combing through your bank account and credit card statements, calculate what you’re spending on electricity, gas, water, internet, cell phone, landline, printer cartridges, paper, and office supplies for at least one month — and the same month in 2019. To get a better picture of costs, you may want to compute costs for the past three months and corresponding three months in 2019 (or even better, the past 12 months and corresponding 12 months in 2018 and 2019) and get an average. Now subtract your pre-pandemic costs (probably the smaller number) from your current costs. This is roughly how much your monthly home expenses have increased.

Track current and pre-pandemic office or work expenses

Include work clothes, shoes, dry cleaning, gas or other commuting expenses, lunch, happy hour bills, coffee drinks, and anything else related to work. Again, you can do this for one month this year and the corresponding month in 2019. Or for three months this year and pre-pandemic or last 12 months and corresponding months pre-pandemic — and calculate the average. Next, subtract today’s costs (probably the smaller number) from your pre-pandemic costs. This is roughly how much your monthly office or work-related expenses have fallen.

Compare your home costs to your office expenses

Do your increased costs offset your decreased costs so that you’re basically spending the same amount now than you did pre-pandemic? That’s great! There are no adjustments to make.

If you’re spending more now than pre-pandemic, find ways to save

Part of the increase is likely related to inflation, but you’ll still want to lower your home expenses that have increased. Find areas to target for making cuts, below.

Or perhaps you want to rethink working from home if your company is offering flexibility. Read on for WFH pros and cons to help you make the decision.

Recommended: How Much Money Should I Save a Month?

If you’re spending less now than pre-pandemic, find ways to grow your savings — and celebrate!

It looks like you are keeping more of your paycheck working from home. It’s no surprise, actually: average commute costs exceed $4,500 each year, and that figure continues to climb with rising gas prices. Of course, you could spend some of the freed-up disposable income, but you may be best off putting the money somewhere it can grow. Check out some ideas, below.

Ways to Trim Costs in a Work-From-Home Budget

If your WFH budget needs some recalibrating, here’s where you may want to look for costs that can be cut.

Utilities

Working from home means you’ll most likely see a bump in utility costs to keep everyone comfortable throughout the day. California residents, for example, used 15-20% more energy through 2020 than the previous year. To shave costs, consider taking energy-conserving steps such as shutting down your computer at the end of the workday and closing AC and heat vents and doors of unused rooms during the day.

Food

You’re likely spending less on lunch if you are making it in your kitchen. But are you? Or are you ordering in dinner more than before? Food delivery apps saw tremendous growth during the pandemic — as did online grocery delivery services. When looking for ways to cut expenses, you may want to limit how many times you order in a week — and stop having your groceries delivered.

Potential Impulsive Spending

According to a study of 2,000 Americans in 2020, the pandemic brought on a slew of impulse purchases, especially in hard-hit areas with shortages and price increases. At the time of the poll, the price of the average impulse buy was more than $180. Be aware of this whether you’re shopping online or in person.

Recommended: 33 Ways to Make Money From Home

Get up to $300 when you bank with SoFi.

Open a SoFi Checking and Savings Account with direct deposit and get up to a $300 cash bonus. Plus, get up to 4.60% APY on your cash!


What to Do With Saved Money From Working From Home

During the pandemic, the personal savings rate skyrocketed to as much as 33% — almost five times what Americans were normally able to save prior to the shutdown (7%). Working from home turned out to be a boon for the bank accounts of many. If you’ve been able to save as a result of working from home, you may want to consider making one or more of these moves:

•   Pay off debt

•   Start an emergency fund if you don’t have one yet

•   Increase your contribution to your retirement account

•   Park the money in a high-yield savings account

•   Invest through a brokerage account

Rethinking Working From Home

If your employer is letting you choose where you work and you are spending more now than you did before, you may want to reconsider working from home. Consider which advantages and disadvantages apply to you, and how much they matter to you.

Advantages of Working From Home

•   Flexibility

•   Better work-life balance

•   No commuting

•   Fewer office politics

•   More independence

•   Save on expenses like wardrobe, coffee runs, lunches with coworkers

Disadvantages of Working From Home

•   Lack of separation between work and personal life

•   Increased childcare or housework load

•   Many, many distractions at home

•   Possible less productivity

•   Weaker connections to coworkers

•   Isolated work environment

Figuring out how to make working from home work is no small task. Beyond the increased amount of juggling you’ll have to do, many struggle with how to stay productive working from home. Some people prefer the environment of a formal office.

The Takeaway

Working from home has its pluses and minuses — and one plus is saving money on all the expenses that come with commuting to work, having to be presentable, and eating lunch outside the home. But if your work-from-home expenses exceed those savings, you may want to look for ways to lower your spending — and possibly reconsider working from home (if it’s optional).

But if you’re saving more by working from home, you’ll want to figure out where best to sock away the money. If you decide you want to keep it liquid but still have it earn interest, SoFi high-yield banking offers a competitive APY with direct deposit. You’ll also pay no minimum account fees, monthly account fees, or overdraft fees.

Get the most out of your money with SoFi Checking and Savings.

FAQ

How much money do you save when working from home?

How much money you save working from home depends on your situation and personal habits. If you no longer have high transportation costs or pay less for childcare, you could be saving a substantial amount of money. If you’re spending more on utilities or food delivery while working from home, you may not save that much.

Does working from home cost more?

Working from home may increase costs in your utilities, groceries, and home office equipment. However, it may be cheaper if you had been paying a lot in transportation and wardrobe expenses that are no longer required.

Is it better or worse to work at home?

While some appreciate the found time from not commuting back and forth or freedom from not having someone breathing down their necks, others enjoy the structure and separate space that working from an office provides. The financial impact on your life will also vary according to your circumstances.


Photo credit: iStock/AsiaVision

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2023 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.


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

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

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

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

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

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


Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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