Ideas for Doing Thanksgiving Inexpensively

31 Ideas for Doing Thanksgiving Inexpensively

If you’ve ever hosted Thanksgiving dinner, you likely know how easy it is for costs to spiral. Between appetizers, drinks, the turkey, sides, and pies, you can easily rack up (multiple!) large tabs at the grocery store.

Even if you’re just traveling to have Thanksgiving with family or friends, you can end up putting a big dent in your spending account. Airlines and hotels often charge a premium during high-demand times like Thanksgiving weekend.

To avoid overspending just a few weeks before gift-giving season, read on. We’ve got 31 ways to keep your Thanksgiving costs under control.

Thanksgiving on a Budget: How to Save

Here are some simple strategies for doing Thanksgiving inexpensively this year. Bonus: They can also help you save time — and stress.

1. Stocking Up as Stuff Goes on Sale

Throughout November, stores typically have different Thanksgiving dinner items on sale. Grabbing nonperishables whenever you see them on discount can save a bundle, and also help spread out the cost of the meal.

2. Making It a Potluck

Whether you’re celebrating with family or friends, you can make Thanksgiving inexpensive by asking your guests to each contribute a dish. You can coordinate who is bringing what in advance to make sure there are no overlaps or gaps.

3. Checking Coupon Sites

Before heading out to the grocery store, you may want to check out coupon websites like Coupons.com , LOZO , and CouponMom to find deals on the items on your shopping list.

4. Going to Manufacturers’ Websites

A few major brands likely produce many of the items on your Thanksgiving shopping list. It can be worth checking websites like Butterball and General Mills for coupons and seasonal promos.

5. Getting Your Grocery Store’s App

Many supermarkets have apps that offer coupons and deals. Sometimes you can get a reward just for signing up.

6. Hitting More Than One Store

Going to just one supermarket is obviously more convenient. But if you check the circulars, you may see different items on sale at different stores. Going to a few different grocery stores could lead to significant savings.

7. Buying a Store-Brand Frozen Turkey

Typically, a turkey makes up about 40% of the cost of the Thanksgiving meal. Opting for a store-brand frozen bird, rather than a fresh one, can significantly lower your total outlay for the meal.

8. Splitting the Costs

You may want to consider teaming up with a sibling or other family member to co-host this year’s gathering. That way you can spit all of the costs, rather than foot the entire bill.

9. Buying Basics in Bulk

Buying staples like flour, potatoes, eggs, cream, and butter from a warehouse store like Costco or Sam’s Club can help you spend a lot less on food, as long as you’re not buying more than you need or will use up after Thanksgiving.

Recommended: How to Buy in Bulk: Beginners Guide

10. Going Generic

Many times, generic or store-brand products are just as good as the brand name version, and the only real difference is price.

11. Asking Guests to BYOB

Wine, beer, and other alcohol can add up quickly. One easy way to save money is to ask your guests to bring their favorite beverage. That way, everyone will get to sip something they love, and you won’t have to shell out all that extra money.

12. Sticking With Seasonal Produce

Vegetables that are in season in November, such as sweet potatoes, squash, Brussels sprouts, and white potatoes, will typically cost a lot less than out-of-season picks, such as corn, asparagus, and green beans.

13. Going With Frozen Veggies

If you want to use veggies that aren’t in season, you may want to choose the frozen versions, which are generally much cheaper than fresh.

14. Baking Your Own Bread

Baking bread can be fun, and typically involves spending a lot less than buying rolls or loaves at a bakery. You can also make bread ahead of time and stick it in the freezer until the big day.

15. Going Simple with Sides

It can be tempting to try a new gourmet recipe you saw online or in your favorite food magazine, but fancy recipes often require specialty ingredients — and can end up costing a lot to make.

16. Not Going Overboard

You may love the idea of giving your guests a cornucopia of options, especially when it comes to appetizers and sides. But making a lot of different dishes can lead to a much longer and costlier grocery bill. And, much of that food may end up going to waste.

17. Getting a Bigger Turkey Than You Need

Yes, this sounds like a way to increase costs. Going with a larger bird, however, can pay off by giving you several additional meals, like turkey sandwiches and turkey pot pies, you can make later without going back to the store, or spending another dime.

18. Considering Pre-Made Dishes

Sometimes store-made dishes and desserts can actually be cheaper than buying all of the ingredients and making these things yourself. It can be worth doing some quick math at the store. This move can also save you time, as well as stress.

19. Shopping Your Pantry

You may already have quite a few shelf-stable items in your pantry (maybe even from last Thanksgiving) that you need this year. It can be well worth the time and effort to give your cabinets a once-over before you head to the market.

20. Watching a Movie at Home

Though many people have a tradition of going out to the movies on Thanksgiving, theater tickets and concessions can be pricey. Instead, you may want to consider renting a movie from a streaming service (or finding a free one) that everyone can watch together on Thanksgiving night.

21. Not Going to the Mall

The average American dropped about $312 going shopping over the Thanksgiving holiday weekend in 2020, according to the National Retail Federation . If you don’t want to be tempted by Black Friday bargains, your best bet may be to avoid stores and stay off-line.

Recommended: How to Cut Back on Spending

22. Using Up Airline Points

If you need to travel by plane over Thanksgiving, you may want to consider using any points you’ve racked up with the airlines or on your credit card to score a free or discounted ticket.

23. Going on a Staycation

While taking a vacation over the Thanksgiving holiday can be fun, it could add up to thousands of dollars between the flights, hotels, and rental car, depending on where you go. You may want to consider staying home and planning a series of local adventures instead.

24. Staying in an Airbnb

If you normally stay in a hotel when you visit family or friends over Thanksgiving, you may be able to save by going with an Airbnb instead, especially if you can share it with other people who are coming in from out of town.

25. Checking Warehouse Clubs for Travel Deals

Before you book any Thanksgiving travel, you may want to check for deals offered by your local warehouse club. If you are a member, you may be able to access discounts on hotels, rental cars, vacation packages, and more.

26. Asking for Travel Discounts

Whether you’re renting a car or staying in a hotel over Thanksgiving, it can be a good idea to ask if you are eligible for any discounts when you book. You may be able to score a lower price if you’re a AAA member, a student, a resident of the state, a member of the military, or over age 55.

Recommended: 27 Tips For Finding The Top Travel Deals

27. Making a Budget

Whether you’re hosting or heading out of town, it can be a wise idea to come up with a total amount you can afford to spend on Thanksgiving. You can then make a list of expected expenses, and determine how much you can realistically spend on each item.

Recommended: Building a Line Item Budget

28. Going DIY with Decor

A fun way to save money on Thanksgiving is to recruit the kids in the family to create your decorations. They could collect and paint pine cones, create cut-out turkeys (using their hands to trace them), or make a craft paper tablecloth where everyone can write or draw what they are thankful for.

29. Handing the Reins to Someone Else

Hosting can be fun and rewarding, but if you need a reprieve from the work — and expense — you may want to see if someone else wants to step up this year. You can offer to bring your famous balsamic roasted Brussels sprouts and garlic mashed potatoes to make the host’s job easier.

30. Going Out to Eat

Local restaurants may be offering Thanksgiving specials to bring in customers. You could save big if you go out to eat (and split the tab) rather than host everyone at your home.

31. Volunteering for the Holiday

Helping out at a local soup kitchen can be a great way to get into the holiday spirit and have a chance to focus on giving back, rather than spending.

TheTakeaway

You can enjoy Thanksgiving (and the upcoming December holidays) without running up expensive credit card debt that you may struggle to pay back.

One great way to keep your holiday costs under control is to set up a simple budget and then make sure you stick to it by keeping track of your expenses as you go.

With a SoFi Money® cash management account, you can easily track and categorize your weekly spending right in the dashboard of the SoFi Money app.

Learn how SoFi Money can help you keep tabs on spending this holiday season.

Photo credit: iStock/GMVozd


SoFi Money®
SoFi Money is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member FINRA / SIPC .
Neither SoFi nor its affiliates is a bank. SoFi Money Debit Card issued by The Bancorp Bank. SoFi has partnered with Allpoint to provide consumers with ATM access at any of the 55,000+ ATMs within the Allpoint network. Consumers will not be charged a fee when using an in-network ATM, however, third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.
External Websites: The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
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Tips for Becoming Financially Independent

Few things may sound as appealing as the idea of becoming financially independent. Though financial independence can mean different things to different people, it typically refers to being able to live comfortably off one’s savings and investments with no debt whatsoever.

In some cases, it may also mean the ability to retire early, though financial independence doesn’t necessarily have to mean leaving a career you love. It’s about working because you want to, not because you have to.

Sound appealing? Achieving financial freedom could be easier than you think. The process of getting there often comes down to a relatively simple principle: Spending less and saving more.

Below, we take a look at what it means to become financially independent and explore some practical strategies for achieving it.

What Does Financial Independence Look Like?

While there is no set definition for financial independence, the term often means getting to a point where you don’t have to work to pay your living expenses. Usually, financial independence is achieved by relying on savings, investments, and other forms of passive income to pay the bills.

Though financial independence doesn’t have to mean leaving behind a job or career path, it can. In fact, the term is often used as a synonym for early retirement, and the two phrases are commonly strung together in the popular acronym FIRE, which stands for “financially independent, retire early.”

Benefits of Financial Independence

There are myriad benefits to becoming financially independent. One of the biggest perks is the ability to have choices. You can choose to keep working if you enjoy it, or you can kick back and relax. You can save money to pass on to future generations or you can splurge on a trip around the world.

Becoming financially independent can also enable you to enjoy work more. If you’re no longer doing it for the money, you can structure your job responsibilities so you’re only doing the things you want to do.

It can also benefit your mental and physical health. Having the ability to work less allows you to exercise more and get more sleep. Financial independence may also allow you to spend more time with a partner, kids, family, and friends. Having stronger relationships can lead to increased happiness in life.

How to Be Financially Independent

Becoming financially independent typically requires having a clear plan in place and being willing to roll up your sleeves and get to work. Here are some key steps that can help you get there.

Setting Realistic Goals

Being financially independent can look different for everyone, so a good place to start can be to define what being financially independent means to you. What do you visualize? Maybe you want to be debt-free by 40, or you’d like to retire at 50. Or, perhaps you’d love to relocate to some place warm and sunny in ten years.

As you develop your goals, you may want to give them a reality test by consulting with a financial advisor or chatting with a trusted financial mentor. You may find that you need to re-jigger your vision based on your financial situation and how much time you have to achieve your dream.

Once you’ve honed in on some specific, achievable long-term goals, you can begin to figure out what you’ll need to do to make them a reality — whether that’s cutting your spending, boosting your income, and/or saving and investing more than you currently are each month.

Understanding That Income Isn’t Everything

Many people have a tendency to fixate on how much money they are making. And while income is an important part of your financial big picture, it isn’t everything. Yes, it’s easier to amass assets if you have more monthly income, but one key to increasing your net worth is to spend less than you make.

For example, if you are making a comfortable salary but haven’t gotten into the habit of saving and investing, then you may not be leveraging your income to its full potential. Becoming financially independent often requires an understanding that the amount of money you make is just one piece of the puzzle.

The path to financial independence may become a little less daunting once you realize that a high income alone is not necessarily going to lead to sustainable wealth. There are several other factors that play a role in how much you are able to grow your finances, such as how much interest your investments are making and the rate at which you are able to save.

More than a high salary, financial independence typically requires foresight, long-term thinking, and a holistic understanding of how your income overlaps with your expenses, lifestyle, and future goals.

Recommended: How Much of Your Paycheck Should You Save?

Building a Budget

No matter what your income level, one of the keys to getting ahead and achieving financial freedom is to spend less — and potentially a lot less — than you are earning. And, doing that typically requires coming up with a budget.

Budgeting is the process of measuring income, subtracting expenses, and deciding how to divert the difference toward reaching your goals. It’s often considered the essential first task in achieving financial independence.

You can set up a monthly budget by first assessing what you are currently earning (after taxes) each month. Next, you can tally up your actual spending by looking at the last three to 12 months of bank and credit card statements and recording your expenses on a spreadsheet.

Seeing it all laid out in black and white can help you identify unnecessary expenses you might be able to cut out. You can then put the difference towards your long-term goals instead. One rule of thumb is to try to put 20 percent of your monthly take-home income into savings or investments. Working couples might try to bank a substantial part of one salary if possible.

Recommended: How Much Money Should I Save a Month?

Establishing A Safety Net

Achieving financial independence also means thinking about financial security. Having a dedicated emergency fund that can help you weather a health emergency or another large, unforeseen expense means you may not have to run up credit card debt or dip into your investment or other savings account in order to cover these costs.

If you haven’t already started an emergency savings account, consider whether or not you would be able to afford a sudden car repair or if you could handle paying out of pocket for an unexpected dental procedure.

Experts often recommend having at least three- to six-months worth of living expenses set aside in an account that earns interest but can be easily accessed when you need it.

The more effective you are at dealing with financial emergencies, generally the faster your savings and investments can grow.

Putting a Debt Pay-Off Plan Into Action

Taking care of your debt is another important step to achieving financial independence. Today, debt can take many forms — whether it’s student loan debt, a home mortgage, a car loan, or credit card debt.

If you currently have debt, consider incorporating a debt reduction plan into the budget you create and calculate how you would need to tweak your current spending habits in order to prioritize becoming debt-free.

It can be wise to start with the debt that has the highest interest first, since borrowing from those creditors is costing you the most money.

If you have multiple credit card balances, you may want to target them one at a time. You can do this by paying more than the minimum each month on one balance (paying just the minimum on the others) until that balance is wiped out, then move on to the next.

Recommended: Three Ways to Help Pay Off Debt Faster

Being a Smart And Savvy Investor

Becoming a smart investor is another key step you can take on your journey to financial independence. The world of investment can be confusing and carries risk, but it also has the potential to be lucrative. Because you earn interest not only on your contributions, but also on accumulated interest, small amounts can grow over time.

You may want to first focus on tax-advantaged accounts. If you have an employer-sponsored plan, such as a 401(k), it can be a good idea to contribute some of each paycheck, especially if your employer offers to match your contributions. Depending on your situation, you may be able to open a traditional IRA, Roth IRA, or SEP IRA, as well.

If you have children, you may also want to start a 529 plan to help you invest for their college educations.

If you’re able to invest additional funds, you can choose a financial firm you want to work with and then open a standard brokerage account. From there, you can put your money in a mutual fund or an exchange-traded fund (which bundle different types of investments together), or, if you’re prepared to do a fair amount of research, pick and choose your own stocks and bonds.

If you’re new to investing, you may want to consider opening an investment account through a robo-advisor, an investment management service that uses computer algorithms to build and look after your investment portfolio, and typically charges relatively low fees.

Recommended: How Much Should You Have Saved for Retirement by 40?

The Takeaway

Not everyone inherits a fortune or makes a huge salary. But even if you don’t have those advantages, it doesn’t mean you can’t achieve financial independence. Getting there, however, can take work and spending discipline.

Some steps that can help you get there include: creating a budget, trimming expenses, building an emergency fund, paying off debt, and setting up a smart saving and investing strategy that factors in your timeline and tolerance for risk.

Once you set up a plan to work towards financial independence, it can also be a good idea to check-in regularly on how well the plan is working, and to make adjustments when necessary.

Whether you decide to schedule quarterly meetings with a financial advisor, monthly money talks with your significant other, or use apps that help you track your expenses and investments, consider creating habits that help you stay on top of your goals.

With a SoFi Money® cash management account, you can track your weekly spending (and make sure you’re staying within your budget) right in the dashboard of the SoFi app. You can also use SoFi Money’s “vaults” feature to separate your spending from your savings, while earning competitive interest on all your money.

Learn how SoFi Money can help you work towards your financial goals today.


SoFi Money®
SoFi Money is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member FINRA / SIPC .
Neither SoFi nor its affiliates is a bank. SoFi Money Debit Card issued by The Bancorp Bank. SoFi has partnered with Allpoint to provide consumers with ATM access at any of the 55,000+ ATMs within the Allpoint network. Consumers will not be charged a fee when using an in-network ATM, however, third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.
SoFi Invest®
The information provided is not meant to provide investment or financial advice. Investment decisions should be based on an individual’s specific financial needs, goals and risk profile. SoFi can’t guarantee future financial performance. Advisory services offered through SoFi Wealth, LLC. SoFi Securities, LLC, member FINRA / SIPC . The umbrella term “SoFi Invest” refers to the three investment and trading platforms operated by Social Finance, Inc. and its affiliates (described below). Individual customer accounts may be subject to the terms applicable to one or more of the platforms below.

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What Are P2P Transfers & How To Use Them

One of the most popular forms of electronic payment, peer-to-peer transfers (also known as P2P payments) give you the ability to send money to friends and family right from your mobile device. To make these payments, all you need is to download a money transfer app like Venmo or Paypal and then link your bank account or credit or debit card to it.

Here’s a closer look at exactly how these apps work, what fees may be involved, and how to use them safely.

What Is a P2P Payment?

Previously, if you wanted to share the cost of dinner with a friend or split bills with roommates, you would need to get cash at an ATM or write out a personal check, options that aren’t always quick or convenient.

With a P2P payment, you can send money to a friend with just a few clicks on your mobile device. For traditional P2P apps, both parties need to have an account with the transfer service in order to make the transaction.

For example, if you want to use Venmo to repay a friend for the coffee they bought you this morning, that person would also need to have a Venmo account to receive that payment.

Typically, a P2P account is attached to your bank account. Some P2P platforms, however, allow customers to link their P2P accounts to a debit card or even a credit card, though it may involve additional fees.

Many traditional, commercial banks are also getting in on the online money transfer game, offering services like Zelle to make it easier for customers to transfer money to one another instantaneously.

Recommended: How to Transfer Money From One Bank to Another

How Do P2P Transfers Work?

One of the biggest draws of P2P money transfers is how quickly and easily a payment can be initiated and transferred. These apps remove the need to share any personal financial information with the other party, and allow funds to be exchanged between different banks smoothly, often with no or very low fees.

Overview of the P2P Transfer Process

Say that you want to send money to your sister for your mother’s birthday present. Depending on the type of P2P service you use, you’ll follow some variation of these basic steps.

Creating a P2P Account. You will need to download a P2P app and then sign up for an account. In order to send money to your sister, you’ll both need to have an account with the same money transfer service.

Linking your bank account to your P2P account. Some P2P services have the ability to hold funds, but they generally must be linked to a primary bank account, credit card or a debit card in order to be fully operational. This is how the account will pull any funds needed to make a payment. To link your checking account, you may need your checking and routing number (which appear at the bottom of a check). Some P2P transfer services may only need your bank log-in information. Others may allow you to set up extra verification measures.

Searching for a user to transfer funds to. To send money to your sister, you’ll need to find her on the P2P platform. You can typically search by username, email address, or a phone number. Her photo may also appear within the profiles that you find, which will also help you ensure you’ve found the correct account. In most cases you will be able to add her account as a contact or “friend” in your account.

Initiating a transfer. Your sister can request a payment from you, or you can initiate the payment yourself. This requires choosing the option to send funds, entering a dollar amount, and then clicking submit. If you’ve enabled additional security measures on your account, you may need to enter a PIN that gets texted to you as well.

You may also have the option to add a description or “memo” to your transaction. Some P2P services, like PayPal, require this information so that they can charge a fee for business-related transactions. Others offer the option to act as a personal ledger should you need it in the future.

Waiting for the transfer to complete. When money is sent from one customer to another, it moves in the form of an electronic package safeguarded with multiple layers of data encryption. This makes it hard for hackers to access the data within the transfer while it is in motion. Similarly, data encryption keeps your money and account information safe.

Once the data set reaches its destination, it is decoded and deposited as currency, and your sister may receive any combination of text, email, or other alerts when the transfer is complete.

Transferring the funds into the payee’s bank account. When a transfer is complete, the funds may be deposited directly into your sister’s bank account. Or, they may go into an account created for her by the P2P service. Funds received into P2P user accounts can then be transferred into traditional bank accounts at little to no cost.

If your sister receives funds into her P2P account and decides to leave them in the account, she can use that account balance the next time she needs to pay someone. Depending on the vendor, she may also be able to use her P2P account to purchase your mom’s birthday gift.

How Long Do P2P Transfers Take?

The general rule of thumb for P2P services is to allow one to three business days for a transfer to complete. That’s because standard bank transfers use the ACH (or Automated Clearing House) system, which can take a day or two to complete.

Some apps offer instant transfers for a small fee, often around 1.5 percent of the overall transfer amount.

Are P2P Money Transfers Safe?

Any time your bank account, credit, or debit card information is online, there is a chance that someone can get a hold of it, and P2Ps are no different. While all major money transfer companies encrypt your financial information, no P2P system is totally impervious to hacks and scams.

The good news is that major financial services typically do all they can to keep information safe, and both the P2P services and your bank are likely adept at dealing with any issues of fraud. Still, it can be important to read each company’s security policy to make sure you’re comfortable with their tactics before agreeing to use that service.

There are also additional measures you can take to make sure that your account remains secure. For example, you may be able to set up two-factor authentication (which might involve typing in a unique pin number that is texted to your phone for each transaction) and also elect to receive notifications each time there’s a transaction posted on your account, enabling you to spot fraud right away if it were to happen.

You may also want to take care when you type in a recipient’s email address, phone number, or name. A typo could lead to the money going to the wrong person. It can be wise to always double-check your recipient’s information before you send a payment.

How Do Peer-to-Peer Transfer Companies Make Money?

P2P transactions are largely offered for free, which may beg the question of how the companies that offer these services stay in business. Here are two major ways they may generate income.

Account Fees

Typically, you can make P2P payments from a linked bank account or straight from the P2P account for free. If you want an instant transfer, or you are transferring money using a credit card or from depositing checks into your P2P account, there may be a fee involved.

Business Fees

P2P platforms aren’t just for consumers — they are used by businesses as well. Companies can create business profiles on P2P platforms and give their customers an additional payment option for their goods and services.

Compared to the free transactions that standard user profiles offer, business profiles are generally subject to a seller transaction fee for each customer purchase. Venmo, for instance, charges a fee of 1.9 percent, plus 10 cents for each transaction.

What Are the Benefits of P2P Money Transfers?

There are three main benefits to using online money transfer services.

•   They’re fast. Depending on the service, P2P money transfers can be deposited fairly quickly. Most service providers provide same-day transfers between user accounts, as well as bank transfers that take just a few business days.

•   They’re cheap. When exchanging money between friends and family, P2P money transfers are often free. There may be a small fee, however, If you want an instant bank transfer, are using a credit card instead of a bank account, are making a transfer above a certain dollar amount, are conducting a high volume of transfers, or are using the service for a business transaction.

•   They’re easy. P2P transfers eliminate the need to make trips to the ATM or a local bank branch to get cash. They also eliminate the need to get out your checkbook, write a check and then mail it to someone. A P2P transfer online makes moving money within your network as easy as can be. All you need is a mobile device, the app, and cell service or WiFi.

Recommended: 8 Ways to Pay Your Friends Without Cash

The Takeaway

Peer to Peer (or P2P) payment apps facilitate mobile money transactions. You can use them in place of cash or writing a check when you want to give friends or family money, whether it’s to cover your portion of a dinner bill or split the cost of a vacation rental. Some businesses also accept this form of payment.

All you need to make a P2P transfer is a mobile device, an internet connection, and your P2P app, which you must link to your bank account or credit card. Typically, P2P transfer services require that both parties have accounts with their service in order to make a transaction.

Customers with a SoFi Money® cash management account, however, can send money to any person, anywhere, even if that person doesn’t have a SoFi Money account. If the person does happen to be a member of SoFi Money, the transfer will happen instantaneously.

Find out how quick and easy it is to make P2P transfers with SoFi Money.


SoFi Money®
SoFi Money is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member FINRA / SIPC .
Neither SoFi nor its affiliates is a bank. SoFi Money Debit Card issued by The Bancorp Bank. SoFi has partnered with Allpoint to provide consumers with ATM access at any of the 55,000+ ATMs within the Allpoint network. Consumers will not be charged a fee when using an in-network ATM, however, third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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Top Budgeting Tips for Single Parents

If you’re a single parent, you probably carry a lot of weight on your shoulders. From paying for clothes to putting a roof over your children’s heads, all — or most — of it likely comes down to you. You may find it challenging just to make ends meet, and put off things like paying off debt or saving for the future.

Fortunately, there are ways to make it easier to manage as a single mom or dad. Even taking a few simple steps, like setting up a simple budget and automating your finances, can improve your bottom line and help you feel more in control of your money.

Read on to learn key financial tips for single parents.

9 Ways to Budget As a Single Parent

1. Crunching the Numbers and Creating a Single Parent Budget

A great way to get a better financial path is to first figure out where you currently stand and come up with a monthly budget.

You can do this by gathering your financial statements for the past several months, then using them to figure out your average monthly income (after taxes), including any child support or alimony you receive.

Next, you can tally up your fixed expenses (monthly bills) and variable expenses (clothing, food, entertainment) to see how much, on average, you are spending each month.

Ideally, you want your monthly inflow to be larger than the outflow — that way, you have money left over for savings and paying off debt. One budgeting rule of thumb is the 50/30/20 ratio, which divides your income into three parts: 50 percent for needs, 30 percent for wants, and 20 for savings and paying off debt beyond the minimum.

If your current income isn’t high enough to make that work, you can re-jigger the percentages and come up with a spending and saving plan that works for you.

2. Trimming Expenses in Your Single Mom Budget

If you find yourself breaking even or, worse, going backwards each month, you may next want to look hard at your list of expenses and start searching for ways to save money.

A key single parent budgeting move is to hone in on your recurring bills to see if there are any ways to lower them. You might be able to switch to a cheaper cell phone, for example. Or, maybe you can find a better deal on car insurance or ditch your cable subscription.

You can also look for ways to cut everyday spending, such as breaking a morning coffee shop habit, cooking more often and getting less take-out, and using coupon apps (like Yowza and Coupon Sherpa) whenever you shop for food and other household items.

3. Opening an Interest-Bearing Account

Once you start freeing up some money each month, it can be a good idea to start siphoning it off into a high-yield savings account. This can help you create some financial security for your family, as well as help you reach short-term goals, like going on a vacation or putting a downpayment on a home.

Even if you can only afford to set aside $25 or $50 per month, it will begin to add up.

Some good places to stash cash you may need in the next two or three years include: A high-yield savings account, an online savings account, or a cash management account. These accounts typically earn more interest than a standard savings account, yet allow you to have easy access to your money when you need it.

You may want to keep an eye out for fees, and shop around for financial institutions that won’t charge you monthly and other account fees (which can take a bite out of your hard-earned savings).

4. Prioritizing Emergency Savings

Expensive problems you can’t plan for often come up, like a car or home repair, taking a child to urgent care, or a sudden loss of income. Without a cushion, small money problems can quickly balloon into big ones if you are forced to run up high interest credit card debt to deal with them.

As you start building savings as part of your monthly single parent budget, it can be wise to prioritize emergency savings. Experts often recommend having at least three- to six-months worth of living expenses stashed away in a separate savings account where you won’t be tempted to spend it. That way it’s there when you need it.

5. Paying Off Your Credit Cards

Eliminating even one high-interest credit card debt can make a significant change in your monthly cash flow. When creating a budget for a single mom (or dad), it can be a good idea to leave room for credit card payments that are higher than the minimum.

You may want to start with the debt that has the highest interest first since borrowing from those creditors is costing you the most money. However, if you’re likely to get discouraged because it’s taking a long time to pay off that debt, you can start with the lowest balance debt. Getting some small debts paid off may motivate you to keep going.

Whatever debt you target, you can then pay more than the minimum payment on that debt while continuing to pay the minimum on others, with the goal to eliminate them one by one.

6. Planning for the Future

Once you’ve mastered your day-to-day finances, you may want to look toward your two big long-term financial security goals: retirement and your children’s college education.

If you can’t comfortably save for both at the same time, you may want to begin with retirement. While your kids can likely get loans for college, there aren’t loans for retirement.

You may want to start by contributing to any employer-sponsored 401(k) plan. If your employer is matching contributions, it can be a good idea to chip in at least enough to get the match (otherwise you’re turning away free money!). Or you can set up an IRA; even $25 or $50 a month at first is a start.

When you’re in the habit of regularly contributing to a retirement savings account, you may want to turn your attention to saving for college: An ESA (education savings account) or 529 college savings fund can help you save towards college expenses while getting a tax break.

7. Automating Your Finances

As a single parent, you may be super busy, making it easy to pay bills late simply because you forgot. Automating your finances can simplify your budget (and your life) and help ensure you don’t get slapped with expensive fees or interest charges for being late with payments.

A good place to start is to set up autopay for all your recurring bills, either through your service providers or your bank. This way you don’t have to stay on top of due dates and remember to make every payment.

Automating can also be a great idea when it comes to saving. Often referred to as “paying yourself first,” you may want to set up an automatic transfer of money from your checking to your savings account on the same day each month, perhaps right after your paycheck gets deposited. This prevents you from spending those dollars or having to remember to transfer the funds to your savings at a later time.

8. Increasing Your Income

If your budget is super tight even after cutting expenses, then you may want to find ways to increase your income. This can help take a lot of the stress off budgeting as a single mom or dad.

There are many ways you can increase your income. For starters, if you’ve been at your job for a while and are performing well, you may want to consider asking for a raise. It can be helpful to research what the industry average pay is for your position with your experience to get an idea of how much you should ask for.

Another way to increase your income is to start a side hustle, like walking dogs, becoming a virtual assistant, taking on freelance work in your profession, selling your crafts, becoming a tutor, caring for other people’s kids, or offering music lessons.

9. Taking Advantage of Tax Breaks

When you’re budgeting as a single mom or dad, it can be smart to be aware of all the tax benefits you may be entitled to. A tax credit is directly subtracted from the amount you owe in taxes, while an exemption means that amount is deducted from your total income before your taxes are calculated.

Here are few tax benefits that may be worth investigating:

•   Filing as “Head of Household” instead of “Single.” If you meet the requirements, you may be able to get a higher standard deduction.

•   The child tax credit. If you share equal custody with your child’s other parent, only one of you can claim this. You may want to consider alternating years.

•   The earned income tax credit. Single working parents with low to moderate incomes often qualify.

•   The child and dependent care credit. If you’ve been paying for childcare so that you can work (or look for work), you may be entitled to this. But only one parent can claim it each year.

The Takeaway

Budgeting as a single mom or dad can be challenging. With some simple financial planning, however, you can start to feel less stressed about money and get closer to both your short- and long-term goals.

Key steps for single moms and dads include taking a close look at your monthly cash flow, trimming expenses, paying off your credit cards, taking advantage of tax benefits for parents, and saving a little each month to create financial security.

If you’re looking for a simple way to stay on top of your single parent budget, you may want to consider signing up for a SoFi Money® cash management account. With SoFi Money, you can earn competitive interest, save, and spend all in one account. You can also easily track your weekly spending right in the dashboard of the SoFi app, and you won’t get hit with monthly fees.

Learn more about how SoFi Money can help single parents keep better tabs on their finances.


SoFi Money®
SoFi Money is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member FINRA / SIPC .
Neither SoFi nor its affiliates is a bank. SoFi Money Debit Card issued by The Bancorp Bank. SoFi has partnered with Allpoint to provide consumers with ATM access at any of the 55,000+ ATMs within the Allpoint network. Consumers will not be charged a fee when using an in-network ATM, however, third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.
Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.
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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10 Personal Finance Basics

Despite how important money is in life, personal finance know-how — or “financial literacy” — is not typically taught in schools, or necessarily by parents.

Unfortunately, a lack of financial knowledge — and, as a result, planning — has led to many young adults racking up credit card debt, living paycheck to paycheck, and not saving enough for retirement.

The good news is that many money issues can be solved just by getting back to personal finance basics — the basics you likely never learned in high school, like how to set up a budget or the best way to knock down debt.

Gaining financial literacy can help more than just your wallet. A 2021 study by the Financial Industry Regulatory Authority (FINRA) found that people who were able to answer three questions that measured basic financial literacy correctly were significantly less likely to feel financially stressed or anxious.

Here are 10 personal finance basics that can help you become more organized with your money, feel less financially stressed, and achieve your goals.

Personal Finance Definition

Personal finance is a term that involves managing your money and planning for your future. It encompasses spending, saving, investing, insurance, mortgages, banking, taxes, and retirement planning.

Personal finance is also about reaching personal financial goals, whether that’s having enough for short-term wants like going on a vacation or buying a car, or for the longer term, like saving enough for your child’s college education and retirement.

Top 10 Basics of Personal Finance

1. Budgeting Is You Friend

Budgeting and learning how to balance your bank account can be key to making sure what’s going out of your account each month isn’t exceeding what’s coming in. Winging it — and simply hoping it all works out at the end of the month — can lead to bank fees and credit card debt, and keep you from achieving your savings goals.

You can get a quick handle on your finances by going through your statements for the past several months and making a list of your average monthly income (after taxes), as well as your average monthly spending.

It can be helpful to break spending down into categories that include basic needs (e.g., rent, utilities, groceries) and discretionary spending (e.g., shopping, travel, Netflix). To get a real handle on where your money is going every day, you may want to track your spending for a month or so, either with a diary or an app on your phone.

Once you know everything that typically comes in and goes each month, you can see if you’re going backward, staying even, or ideally, getting ahead by putting money into savings each month.

If you aren’t living within your means, or you’d like to free up more cash for saving, a good first step is to go through your budget and look for ways to cut back discretionary spending. Can you cook more instead of going out? Buy less clothing? Cut out cable? Quit the gym and work out at home?

You can also consider ways to bring in more income, such as asking for a raise or starting a side hustle from home.

2. Building an Emergency Fund

You can’t predict when your car will break down or when you’ll have to make an emergency trip to the dentist. If you don’t have money saved up for what life throws at you, you can risk racking up high interest credit card debt or defaulting on your bills.

To avoid this, you may want to start putting some money aside every month to build an emergency fund. A common rule of thumb is to keep three to six months of basic living expenses set aside in a separate savings account.

It can be a good idea to choose an account where the money can earn interest, but you can easily access it if you need it. Good options include: a high-yield savings account, online savings account, or cash management account.

3. Avoiding a Credit Card Balance

When you have a credit card at your disposal, it can be tempting to charge more than you can afford. But carrying a balance from month to month makes those purchases considerably more expensive than they started.

The reason is that credit cards have some of the highest interest rates out there, often over 16%. That means a small charge carried over several months can quickly balloon into a much larger sum. The same is true for other high interest debt, such as some private or payday loans.

If you already have high-interest debt, however, you don’t need to panic. There are ways to pay off that debt.

The avalanche method, for example, requires paying the minimums to all your creditors, and putting any extra money toward the debt with the highest interest rate first. Once that’s paid off, the borrower puts their extra cash toward the debt with the next highest rate, and so on.

4. Paying Your Bills on Time

If you miss bill payments or make late payments, your creditors might impose late payment penalties. If you delay payment for a prolonged period, your account could go into delinquency or be sent to collections.

Late payments can also affect your credit score — the number lenders use to help judge whether to give you loans and credit.

Your payment history accounts for 35% of your credit score, so a history of late and missed bill payments can be a major strike against your score. A poor credit score can make it difficult for you to get loans, and the loans you do get are likely to have higher interest rates.

To make sure you never miss a due date, it can be helpful to make a list of your bills and their due dates, set up auto payments when possible, and sign up for reminders.

5. Starting Early to Save for Retirement

When you’re young, retirement can feel far away. But putting money away as early as possible means you’ll have more years to save, spreading the savings across your life rather than racing to catch up.

Perhaps the biggest reason to start as early as you can, however, is the power of compound interest.

Because you earn interest not only on your contributions, but also on accumulated interest, small amounts can grow over time. If you have an employer-sponsored plan, such as a 401(k), you may want to consider contributing, especially if your employer offers to match your contributions.

Depending on your situation, you may be able to open a traditional IRA, Roth IRA, or SEP IRA, as well.

6. Investing

Saving for retirement may not be enough for you to have what you need to live comfortably after you stop working. Plus, there may be things you want to be able to afford later in life, but before you reach retirement age.

If you have children, for example, you may want to start a 529 plan to help you invest for their college educations.

For other long-term savings goals, you may want to invest additional money, keeping in mind that all investments have some level of risk and the market is volatile, meaning it moves up and down over time.

To get started with investing, you can choose a financial firm you want to work with and then open a standard brokerage account. From there, you can put your money in a mutual fund or an exchange-traded fund (which bundle different types of investments together), or, if you’re prepared to do a fair amount of research, pick and choose your own stocks and bonds.

7. Getting Insured

When it comes to insurance, sometimes it’s best to prepare for the worst. That means making sure you have health insurance and car insurance (which is required by law). You also may want to consider renters or homeowners insurance to protect your home and belongings.

If you have children or other people who are dependent on you financially, it can be a good idea to get long-term disability insurance and term life insurance. Many people can purchase health and disability insurance through their employers. If you don’t have that option, it’s possible to go through an insurance agent, broker, or the insurance company directly.

8. Taking Advantage of Credit Card Rewards

If you have a decent credit score, you can look into getting a credit card with rewards that may give you travel miles or cash back on your purchases. If travel is your priority, you may want to look for a flexible travel rewards credit card, meaning their rewards can be applied to many different airlines and hotels.

You may want to look for a card that not only offers rewards, but also offers a nice signup bonus for spending a certain amount within the first few months. One with no annual fee would be ideal, too.

Whichever card you pick, it’s a good idea to familiarize yourself with its rewards program: the value of its rewards units (points, miles or cash back), how to redeem them, whether your rewards expire, and any minimum redemption amounts.

You may also want to keep in mind that credit card interest rates are typically a lot higher than credit card rewards rates. So, to avoid seeing your earnings swallowed up by finance charges, it can be wise to make sure to pay your full statement balance by the due date every month.

9. Checking Your Credit Reports Regularly

You can request a credit report for free from the three main credit reporting agencies — Equifax, Experian, and TransUnion — at AnnualCreditReport.com . In the past, you could only do this once a year, but due to the COVID-19 pandemic, the three credit agencies are now offering free weekly credit report checks.

It can be a good idea to periodically order a copy of your report and then scan it for any errors or signs of fraudulent activity. If you see anything that isn’t right, it’s wise to contact the credit reporting agency or the account provider as soon as possible and file a formal dispute if needed.

Checking your report can help you spot — and quickly address — identify theft. It can also help you make sure there aren’t any errors on the report that could negatively affect your credit score. If you ever want to obtain a lease, mortgage, or any other type of financing, then you’ll likely need a solid credit report.

10. Choosing Your Bank Wisely

There are lots of financial institutions out there, so it can be a good idea to shop around and make sure you find a place that really suits your financial needs. Choices include:

A traditional Bank. These typically have physical locations throughout the country and offer a wide range of financial products and services. If you want to know you can have an in-person chat about your money, this option might work well for you.

Credit Union. These are non-profit organizations owned by the members of the union. They’re similar to a traditional bank, but membership is required to join, and they’re often smaller in scale and have fewer in-person locations. However, they may have lower fees and higher interest rates than a traditional bank.

Online Bank. These institutions don’t usually have any in-person locations — everything happens online. Because of this, they often have very competitive fees and interest rates. If you don’t necessarily need in-person money talk, and would prefer to handle your money at home (or on the go), an online bank could be a great option.

When making a bank choice, it can be a good idea to make sure the bank you choose has a user-friendly website and app, as well as conveniently located ATMs that won’t charge you a fee for accessing your money.

3 Personal Finance Rules to Know

Once you’ve established some fundamental procedures, you can start thinking about some overarching rules that can help you make better money decisions. Three rules you may want to keep in mind include:

•   Keep your goals in mind. Without a clear set of goals, it can be difficult to do the hard work of budgeting and saving. Defining a few specific goals — whether it’s buying a home in five years or being able to retire at 50 — gives you a picture of what personal financial success looks like to you, and can keep you motivated.

•   Learn to distinguish wants from needs. Merging these two concepts can wreak havoc on your personal finances. Needs generally include food, clothing, shelter, health care, and reliable transportation. Everything else is likely a want. This doesn’t mean you have wants, but it can be important not to trade financial security in pursuit of these things.

•   Always pay yourself first. This means taking some money out of each paycheck right off the bat and putting it towards your future goals. Setting aside money in a savings account, IRA, or 401K plan via automatic payroll deductions helps reduce the temptation to spend first and save later.

The Takeaway

Being good with your money requires a set of basic skills that many of were never actually taught in school.
Fortunately, It’s never too late to educate yourself about personal money management. Learning personal finance basics like how to choose a bank, set up a budget, save for retirement, monitor your credit, avoid (and deal with) high interest debt, and invest your money are key to reaching your goals and building wealth over time.

Looking for Something Different?

One simple way to become more organized with your money is to open a SoFi Money® cash management account.

With SoFi Money, you can earn competitive interest, spend, and save all in one place. Using the “vaults” feature, you can create separate savings vaults for separate savings goals (such as an emergency fund) without opening a separate account. Plus, you’ll have access to over 55,000 fee-free ATMs worldwide within the Allpoint® Network.

Check out how SoFi Money can help you keep better track of your personal finances today.


SoFi Money®
SoFi Money is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member FINRA / SIPC .
Neither SoFi nor its affiliates is a bank. SoFi Money Debit Card issued by The Bancorp Bank. SoFi has partnered with Allpoint to provide consumers with ATM access at any of the 55,000+ ATMs within the Allpoint network. Consumers will not be charged a fee when using an in-network ATM, however, third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.
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
.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
External Websites: The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
SoFi Invest®
The information provided is not meant to provide investment or financial advice. Investment decisions should be based on an individual’s specific financial needs, goals and risk profile. SoFi can’t guarantee future financial performance. Advisory services offered through SoFi Wealth, LLC. SoFi Securities, LLC, member FINRA / SIPC . The umbrella term “SoFi Invest” refers to the three investment and trading platforms operated by Social Finance, Inc. and its affiliates (described below). Individual customer accounts may be subject to the terms applicable to one or more of the platforms below.

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