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When a refund goes to a canceled credit card, it may seem like your cash is lost for good. However, getting your money back only requires a few calls to the credit card company and the merchant, as well as a little patience.

There are ways to avoid a refund going to a canceled credit card and methods to recover the cash if it’s stuck in limbo between the retailer and the credit card company. Keep reading to learn how to avoid this situation and what your options are.

Can You Stop a Refund From Going to a Canceled Credit Card?

To avoid a refund being issued to a canceled credit card, the simplest approach is to reach out to the merchant before starting the refund process.

Ask the business if it’s willing to refund the purchase in a different way, which will likely be store credit or a gift card. In some instances, it could mean receiving cash back or refunding the purchase to a different credit card.

This may involve calling customer service or visiting the brick-and-mortar location. If the business is willing to refund the purchase differently, you’ll avoid the lengthy process of receiving a refund that had been issued to a canceled credit card.

Recommended: Common Credit Report Errors and How to Dispute Them

Steps for Getting a Refund on a Canceled Credit Card

When a refund goes to a canceled credit card, there are a few options to ensure you don’t lose the credit. It can help to know a little about how credit cards work, but it’s not essential.

1. Check if Your Canceled Card Account Is Still Open

If your credit card was lost or stolen and you had to cancel it, don’t worry. If the account is still open under a new card number, the refund from the merchant will be credited back to the new card.

Recommended: How to Report Identity Theft

2. See if the Refund Was Accepted by the Card Issuer

When there’s no longer a credit card associated with the account, things get trickier. What happens next depends on when you closed the account.

If you can still log in to your account online, you may see the refund. But if you closed the account long ago and can’t access it online, you should first reach out to the merchant and ask for the Acquirer Reference Number (ARN).

3. Request the Refund

If the merchant tells you they posted your refund to the old account, call the credit card company and request a refund via check. This is when the ARN can come in handy. In some cases, the credit card company or bank may ask for a written request.

4. Be Patient

A standard credit card refund usually takes a week, but getting a refund from a canceled credit card can take longer, depending on merchant policy, credit card company policy, and even the returned item or service. You can typically expect a refund in 7-14 business days after your request.

5. Return Directly to the Merchant for the Refund

If several weeks pass without a refund, it may be time to return to the store to track it down. In some cases, the card issuer may reject a refund to a closed account and send it back to the store. Reach out to the store’s customer service and ask if they received a bounce-back from the credit card issuer. If so, you might be able to request a refund in the form of store credit or cash.

This process can be complicated and tedious, depending on the retailer’s size and bookkeeping system. An independent retailer is unlikely to have a customer service department, so going to the store with receipts and reference numbers could speed up the process.

How to Avoid a Refund Going to a Canceled Card

Asking for an alternative refund method is one way to avoid a refund going to a canceled card, but here are a few other options to avoid a lengthy process.

•   Conduct an audit of transactions before canceling a credit card. Are there any purchases you plan to return? Keeping the card open until the refund is processed could make sense.

•   Keep an eye on finances. A money-tracking app can help you keep tabs on your spending, avoiding the confusion of which refund goes on what card. Some services also offer credit score monitoring at no cost and a debt payoff planner.

•   Think long and hard before canceling a credit card. Canceling a credit card can harm your credit score, and canceling one out of the blue may lead to more issues than benefits. Closing a card without thinking it through could lead to refunds on a canceled card.

Recommended: What Is The Difference Between TransUnion and Equifax

The Takeaway

The simplest way to prevent a refund from going to a canceled card is to go straight to the merchant and ask them to refund the amount using alternative means. That could mean getting store credit, which will sidestep the credit card company and allow you to get your money back faster. If a refund does go to a canceled card, it’s not lost for good, but it involves taking a few steps to recover it.

Take control of your finances with SoFi. With our financial insights and credit score monitoring tools, you can view all of your accounts in one convenient dashboard. From there, you can see your various balances, spending breakdowns, and credit score. Plus you can easily set up budgets and discover valuable financial insights — all at no cost.

See exactly how your money comes and goes at a glance.

FAQ

Can I get a refund that was sent to a closed credit card?

Yes, but getting the refund will depend on whether the account is still open, how long the card has been closed, and the credit card company’s policies. Often, the issuer will either apply the refund to the account or send the funds to the cardholder by check or another payment method.

What happens if the credit card issuer rejects the refund to a closed account?

If the card issuer rejects the refund because the account is fully closed, the funds are typically returned to the merchant. In that case, you’ll need to contact the merchant directly to request the refund again.

What is an ARN?

An Acquirer Reference Number (ARN) is a unique tracking number assigned to a credit card transaction once a refund is processed. The merchant or payment processor can provide this number, and the credit card issuer can use it to locate the refund in the payment network and track its status.

How long does it take to get a refund from a canceled credit card?

Refunds to a canceled credit card can take longer than normal, depending on the merchant’s policies and the credit card issuer. Following up with both parties can help speed up the process.

Can I request a refund in a different form if my card is canceled?

Yes. Merchants may offer alternative refund methods, such as store credit, a gift card, cash, or a refund to a different credit card. Contact the merchant before the refund is processed to arrange this.

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Photo credit: iStock/MBezvodinskikh

SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.

*Terms and conditions apply. This offer is only available to new SoFi users without existing SoFi accounts. It is non-transferable. One offer per person. To receive the rewards points offer, you must successfully complete setting up Credit Score Monitoring. Rewards points may only be redeemed towards active SoFi accounts, such as your SoFi Checking or Savings account, subject to program terms that may be found here: SoFi Member Rewards Terms and Conditions. SoFi reserves the right to modify or discontinue this offer at any time without notice.

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

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

SORL-Q126-055

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Clothing is an often overlooked expense when planning a budget, but pretty much everyone has to spend some money on clothes for work, off hours, and social occasions. Whether you’re a trial attorney who needs a wardrobe full of quality suits or a landscaper who gets good and muddy, there are ways to buy clothing without spending a fortune.

Learn about what goes into retail pricing, where to buy quality clothes, and how to snag some bargains.

Understand What Goes Into Retail Pricing

Fashion brands establish pricing on a cost-per-unit basis. The final retail price is set by factoring in various expenses and business strategies, such as manufacturing and material costs, as well as marketing and branding expenses.

Manufacturing Costs

The cost of raw materials, labor, packaging, and shipping are obvious factors that determine the price of clothing. But pricing is more nuanced than that. Popular brands or high-end brand names will set higher prices for their products on the assumption that they offer higher quality and better designs. There are also marketing costs to consider.

Brand Reputation

Whether a brand is perceived as a luxury brand, like Versace, or a value brand, like those sold at big-box stores, plays a large part in pricing. For example, Lululemon is a popular, in-demand brand that can price its clothing at the higher end of the scale. Sometimes, however, a popular brand may have to slash its prices if it no longer holds the prestige it once did.

Supply and Demand

Supply and demand significantly impacts the final price of a product. If a style, product, or brand is really in demand, retailers can mark up the prices substantially. The fact that there’s a limited quantity of something means that consumers will likely be willing to pay more for it. (The inflation rate can also be part of this equation.)

However, if the supply exceeds demand, retailers will have to drop the price to try to encourage sales so they are not left with inventory they cannot sell.

The Distribution Chain

Another factor in the price of clothing is the distribution chain. Some brands manufacture their own clothing and sell exclusively through their own retail outlets, which can help them maintain lower prices. Warby Parker is an example of a retail brand that sells exclusively through their own retail outlets and website. This business model means fewer add-on costs for consumers.

However, most brands sell through select independent retailers who add on their own margins. Retailers set the final price by implementing their desired markups, as well as any subsequent promotions and discounts, to ensure they aren’t left with inventory.

💡 Quick Tip: Online tools make tracking your spending a breeze: You can easily set up budgets, then get instant updates on your progress, spot upcoming bills, analyze your spending habits, and more.

Seasonality

Some fashions are in demand for one season only and can be pricey until they lose their popularity. At that point, retailers drop their prices or try to sell the clothes in a clearance sale to get rid of old inventory.

You can save money on clothes by buying during the off-season or at clearance sales. There are also other ways to make sure you’re not blowing all your money on clothes.

Make Use of Coupons

Coupons are a sales strategy for retailers, but they also benefit the consumer. Consumers can shop online for less using coupons and other sales discounts. The buyer inputs a coupon code when they check out to initiate a discount on the price.

Knowing how to coupon can help you save a significant amount of money, including on clothes. Coupons can be found on many websites, such as Saving Says, RetailMeNot, and SlickDeals. Many brands also offer a discount if you sign up for their email list.

Buy Clothing from Consignment Stores and Thrift Shops

Buying second-hand clothes is another way to find quality clothes while sticking to a budget. Thrift shops and websites that sell pre-owned clothing are growing in popularity, particularly because of consumer interest in sustainable practices and brands that support the environment.

ThredUp is a popular online consignment and thrift store where consumers can buy and sell high-quality secondhand clothes. Other ideas for where to buy good-quality clothes for less include ASOS Marketplace, Buffalo Exchange, Depop, Etsy, Poshmark, and Vinted.

Recommended: Guide to Selling Used Items

Buy During the Off-Season

Avoid buying on impulse by purchasing clothing in the off-season when you can find quality items on sale. Retailers want to get rid of stock when products are not in season. For example, few people are looking to buy ski gear in the spring or summer. Because there may be more supply than demand for ski gear at that time, retailers will sell it at a discount.

💡 Quick Tip: Income, expenses, and life circumstances can change. Consider reviewing your budget a few times a year and making any adjustments if needed.

Look for Clearance Sales

Fashion trends typically last one season, after which new styles and products appear on the market. Retailers may find themselves with too much old inventory going into a new season, so to avoid losing money, they’ll slash prices and sell items in clearance sales.

Certain retailers, such as Gap and Old Navy, are known for having regular sales cycles. These can be good places to shop if you’re looking to buy good-quality clothes on sale.

Consider Alternative Fabrics and Materials

Why does one T-shirt cost $50, while another is only $15? It could be because the more expensive T-shirt is made of better-quality fabric. Similarly, a pair of real leather boots may be more expensive than a pair made of synthetic leather. In some cases, you might pay more for an item of clothing comprising durable or breathable materials. These are typically investment pieces made of finer materials and crafted with more care to last longer.

However, if an item is serving a short-term fashion need, the quality of materials used may be less important.

Cheaper, synthetic material-based products often get a bad rap. For example, synthetic materials for shoes may be less breathable and durable than leather. Polyester is often compared to silk and criticized for not being “natural.” However, footwear made with synthetic materials may appeal to vegans, and polyester blouses last a lot longer than their silk counterparts. So don’t discount alternatives.

Recommended: High-Paying Vocational Trade Jobs

See Before You Buy

If you do opt for the less expensive option, you might want to check out the item before you buy it. If it’s too cheap and flimsy, chances are it won’t last long. Check the seams and the hems of a dress or jacket to see if the stitching is acceptable, and if there’s a zipper, ensure that it works. Buying a reasonably priced item of clothing is one thing, but there is such a thing as too cheap.

Buy Less, Buy Better

Buying fewer clothes will save you money, so you might think about items to save up for, such as one or two quality pieces that will stand the test of time. You can pair these pieces with other, less expensive items. For example, a couple of quality suits for work can be combined with a number of blouses or shirts that come from a mid-range retailer. You can also build a wardrobe based on a basic color, like black or blue, enabling you to mix and match all your clothes.

Also, remember to read the care labels when purchasing clothes. Those that say “Dry clean only” means you will pay more in cleaning costs than those you can handwash or put in the washer.

Recommended Brands

It’s always good to listen to the experts when it comes to purchasing clothes. Some mid-price quality fashion brands that they recommend include COS, Everlane, Quince, The Gap, American Eagle Outfitters, and Uniqlo.

The Takeaway

Dressing well does not necessarily mean spending all your money if you know where to buy quality clothes and which strategies to follow. In some cases, it’s better to pay more for an item that lasts than to buy something cheap and become frustrated when it comes apart quickly. But you can also find discounts on some great items and save money by using coupons, searching for clearance sales, buying second-hand, or buying off-season.

Take control of your finances with SoFi. With our financial insights and credit score monitoring tools, you can view all of your accounts in one convenient dashboard. From there, you can see your various balances, spending breakdowns, and credit score. Plus you can easily set up budgets and discover valuable financial insights — all at no cost.

See exactly how your money comes and goes at a glance.

FAQ

Where to buy cheap, good-quality clothes?

Consignment stores and thrift stores are good places to buy good-quality clothes for cheap. If you want to buy new, popular mid-range fashion brands, good choices are COS, Everlane, Quince, The Gap, American Eagle Outfitters, and Uniqlo.

How do I not spend all my money on clothes?

Avoid spending too much money on clothes by setting a budget and sticking to it. Also, don’t buy on impulse and focus on purchasing a few classic, high-quality pieces to go with less expensive tops and accessories. Build your wardrobe around a color so that you can mix and match and get more wear out of your clothes.

How can I be fashionable on a low budget?

The trick to being fashionable on a low budget is to choose a few quality items. Then you can pair them with inexpensive, trendier items.

Is it possible to look good without spending a lot of money?

Smart shopping by using coupons, buying off-season, watching out for clearance sales, or exploring thrift and consignment stores helps you get more value while keeping your wardrobe fashionable. With planning and careful choices, looking good doesn’t have to mean spending a lot.

Why are some clothes more expensive than others?

Clothing prices vary based on materials, craftsmanship, and durability. Higher-quality fabrics like leather or breathable textiles often cost more and last longer, while synthetic alternatives such as faux leather or polyester are often cheaper but may be more ethical. It’s worth choosing items based on how long you plan to wear them.

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Photo credit: iStock/pixelfit

SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.

*Terms and conditions apply. This offer is only available to new SoFi users without existing SoFi accounts. It is non-transferable. One offer per person. To receive the rewards points offer, you must successfully complete setting up Credit Score Monitoring. Rewards points may only be redeemed towards active SoFi accounts, such as your SoFi Checking or Savings account, subject to program terms that may be found here: SoFi Member Rewards Terms and Conditions. SoFi reserves the right to modify or discontinue this offer at any time without notice.

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.

Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

SORL-Q126-063

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Credit references are documents that verify your credit history. They can come in the form of a credit check report, asset documentation, or character references.

A limited or poor credit history can potentially impact your approval when applying for a rental. If you have a spotty payment history, a low credit score, or little to no history, your chances of getting approved may go down. Landlords or property management companies can approve or deny rental applications based on these references.

If this description of a less-than-stellar reference fits you, don’t fret. There are ways to put your best foot forward with credit references in today’s competitive market.

Definition of a Credit Reference

Credit references paint a picture of your borrowing and payment habits and history. Property managers and landlords use it to help determine whether you’re likely to pay rent on time and in full.

Documents of financial agreements can be used as credit references. Credit references also come in the form of:

•   Credit reports

•   Asset documentation

•   Character references

•   Financial support letters

In some cases, letters from personal lenders or documents from a car loan can be used. Be sure to clarify what the landlord needs when applying for an apartment. It’s also helpful to pull together the documents ahead of time, so you can pull together references for multiple apartments at once.

💡 Quick Tip: Online tools make tracking your spending a breeze: You can easily set up budgets, then get instant updates on your progress, spot upcoming bills, analyze your spending habits, and more.

When You Need Credit References

At the end of the day, landlords want to know if you’re able to pay rent. Getting an apartment rental is a business transaction between two strangers. Credit needed for an apartment plays a key role in rental applications.

Why Landlords Want Credit References

A credit reference is proof of your financial history. It details how much debt you have, how timely your payments are, and your credit score, among other factors.

For instance, if your credit references show that you’ve been able to pay off your debts in full in a timely manner, a landlord will likely approve your rental forms.

Applicants with low credit scores or poor payment histories have lower chances of being approved.

Recommended: Does Net Worth Include Home Equity?

Types of Credit References

As mentioned, credit references come in different forms, such as credit reports, character references, or formal letters from bank loan officers.

Credit Report

The most available type is a credit report. Three major credit bureaus provide credit reports: Equifax®, Experian®, and TransUnion®. You can obtain a free credit report every 12 months to check your score and scan for errors. The credit scoring system known as FICO® can be used by all three.

Credit reports contain information such as your credit history, current debt, bankruptcies and foreclosures. It can also include the age of your debt and how many credit inquiries you’ve had. Importantly, it’ll also contain your score. Credit scores range from 300 to 850.

Landlords will look at this report to determine the financial risk of each applicant. Generally speaking, a credit score of 670 or higher is considered acceptable, though requirements may vary based on the lender or circumstances.

Another factor that can impact your credit score and report is the number of inquiries into your credit history. If there are a lot of inquiries, they may lower your score since it can be perceived that you may be struggling financially. Some rental applications will include a fee for running the credit check.

Bad or no credit may give a landlord pause, but it may be possible to strengthen your case.

Recommended: What Is The Difference Between Transunion and Equifax?

Asset Documentation

Asset documentation is proof of income, liquid cash, or investments. It shows landlords that you are financially stable and able to handle unforeseen circumstances, such as a job loss.

Your landlord may request a verification letter from your employer, pay stubs, or an offer letter to prove income. You may also have to provide documentation of your savings or investment funds, such as mutual funds or retirement plans. Reach out to your financial institution or brokerage to provide you with documents of your accounts.

The more assets you have, the stronger your application will be.

Recommended: What Credit Score Is Needed to Buy a Car?

Character and Credit Reference Letters

Credit reports and asset documentation only tell part of the story. A character or credit reference letter may give context to a spotty part of your credit history. Someone you’ve had financial transactions with, such as an employer, previous landlord, or business partner, can write a letter confirming your character and values. For example, if you went through hardship, such as a medical illness, but still met your financial obligations, someone such as a prior landlord can vouch for you.

If you have bad credit, for example, an institution can demonstrate if you have taken courses, been given resources such as a debt payoff planner, or worked out a new payment plan to successfully pay off your debt. It demonstrates a commitment to improving personal finance.

Don’t be afraid to ask for a reference letter — many may be willing to write on your behalf. Remember, however, that these types of letters are not as concrete as credit and asset reports. They work better as supporting documentation.

Financier Support Letters

If you have a troubled credit history, a financial support letter from a cosigner on a lease can help. These letters are typically for business owners who need to prove they have the capital to rent or buy.

For a lessee, a guarantor would write a letter with context on how they can support your rent if needed. This can be helpful if you have an adverse credit history. For business owners, the letters would be obtained from financial institutions or financial partners backing a business lease or purchase.

Credit Reference Examples

If a landlord requests written credit reference letters, have a list of people in mind who can type up a quick letter. You could also ask them to type up a generic letter that you can use across multiple applications, or you might offer to supply a draft of the letter for them to edit as they see fit. Sometimes a property management company or landlord will have their own template, so be sure to clarify which format is acceptable.

A credit reference letter can be brief. But it must include key details such as:

•   Reference full name and contact information

•   Length of relationship

•   Payment history

Additional details may be required depending on what your landlord requests. Below is a sample template:

   Dear [Landlord Name]:

   I have known Ben as a tenant for three years. He paid rent ahead of time, was quiet and respectful, and took care of our property. Also, he ended his lease in search of a bigger space. He got his deposit returned in full, so he’s highly recommended as a tenant.

If you do not have a history of renting, you can ask a financial institution to vouch for you. Here’s an example letter:

   [ABC Bank] lent $30,000 to Tina Jones in 2014. She made her payments on time and paid off the loan ahead of schedule in 2017.

If you’re still short a reference, try an employer to vouch for your stability at your current job:

   Tim has been an employee of ACB Company for three years and has been promoted once. His current salary is $92,000. He’s responsible and puts our clients’ interests first. He will make a great tenant.

How to Secure a Credit or Character Reference Letter

Before you send a mass email to all your contacts, confirm with your landlord what details are needed. If there’s a template letter to use, so much the better. Once details are confirmed, reach out to your contacts. Be sure to provide them with all the information they need to include in the letter.

There’s no formal process to request a letter from financial institutions. You can go in person to speak to a banker who can provide you a letter, or you can contact your bank and ask how to obtain one.

How to Improve the Chances of Getting a Reference Letter

Asking with plenty of time vs. saying you need a letter tomorrow is obviously a good move. Also consider authorizing your institution to release personal information while you are actively applying for rentals. Not doing so could cause delays as the letter goes through the chain of command.

The Takeaway

Landlords want to see that you earn income and honor your debts. Credit references are formal documents that support your profile as a reliable tenant. They come in the form of records from credit bureaus and character reference letters from employers, among others.

If budgeting is not your strong suit and you want to build your financial profile, a money tracker app can help.

Take control of your finances with SoFi. With our financial insights and credit score monitoring tools, you can view all of your accounts in one convenient dashboard. From there, you can see your various balances, spending breakdowns, and credit score. Plus you can easily set up budgets and discover valuable financial insights — all at no cost.

See exactly how your money comes and goes at a glance.

FAQ

What do I put as a credit reference?

That depends. Ask your landlord what documents they require for a reference. It can mean a credit report, bank statements, character reference — or all three.

Who counts as a credit reference?

A credit reference can be someone with whom you have a tenant-landlord or business relationship. They can be a representative at a bank who can give a formal written letter of loans or accounts you have with them. Or, if you have limited or no credit history, a reference can be a current or former employer who can highlight your reliability.

Why do I need a credit reference?

Most property management agencies or landlords require credit references in order to approve a tenant application. This gives them an idea of your financial history and whether you’ll pay rent on time.

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Photo credit: iStock/damircudic

SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.

*Terms and conditions apply. This offer is only available to new SoFi users without existing SoFi accounts. It is non-transferable. One offer per person. To receive the rewards points offer, you must successfully complete setting up Credit Score Monitoring. Rewards points may only be redeemed towards active SoFi accounts, such as your SoFi Checking or Savings account, subject to program terms that may be found here: SoFi Member Rewards Terms and Conditions. SoFi reserves the right to modify or discontinue this offer at any time without notice.

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

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

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 .

SORL-Q126-060

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If you’re contemplating a job change or angling for a salary increase, you may have questions about whether a $95,000 salary will sustain you. Consider that the typical worker in the U.S. earns around $69,847 a year, according to the Social Security Administration. A $95,000 annual paycheck is nearly 36% higher than that.

Let’s see where you’d fall on the earnings spectrum compared to others in the U.S. and explore ways to budget a $95,000 annual salary.

Is $95K a Good Salary?

While not quite a six-figure salary, $95K is generally considered a good income for a single person. But whether that amount works for you depends largely on where you live and your personal standards. For example, you may find that a $95,000 salary goes further in Des Moines than in Honolulu, which has a higher cost of living.

No matter where you live, a budget planner app can help you set customized budgets and categorize spending, so you can make the most of your income.

Recommended: Average Salary in the U.S.

Median Income in the US by State in 2026

As in real estate, location is an important factor when it comes to salaries. Wages for the same job can vary widely from one state to another, driven largely by differing costs of living.

Here’s a look at the median household income in each state, per U.S. Census Bureau data.

State	Median Household Income
Alabama	$66,659
Alaska	$95,665
Arizona	$81,486
Arkansas	$62,106
California	$100,149
Colorado	$97,113
Connecticut	$96,049
Delaware	$87,534
Florida	$77,735
Georgia	$79,991
Hawaii	$100,745
Idaho	$81,166
Illinois	$83,211
Indiana	$71,959
Iowa	$75,501
Kansas	$75,514
Kentucky	$64,526
Louisiana	$60,986
Maine	$76,442
Maryland	$102,905
Massachusetts	$104,828
Michigan	$72,389
Minnesota	$87,117
Mississippi	$59,127
Missouri	$71,589
Montana	$75,340
Nebraska	$76,376
Nevada	$81,134
New Hampshire	$99,782
New Jersey	$104,294
New Mexico	$67,816
New York	$85,820
North Carolina	$73,958
North Dakota	$77,871
Ohio	$72,212
Oklahoma	$66,148
Oregon	$85,220
Pennsylvania	$77,545
Rhode Island	$83,504
South Carolina	$73,350
South Dakota	$76,881
Tennessee	$71,997
Texas	$79,271
Utah	$96,658
Vermont	$82,730
Virginia	$92,090
Washington	$99,389
West Virginia	$60,798
Wisconsin	$77,488
Wyoming	$75,532

Recommended: Highest Paying Jobs by State

Average Cost of Living in the US by State

How much you pay for necessities such as housing, transportation, health care, and food can impact just how far your $95,000 salary will go. When figuring out whether $95,000 is a good salary for a single person, it can help to look at how much people in different states are spending on housing, food, health care, and other basics. Here’s what you need to know about the average cost of living in the U.S. by state, based on U.S. Bureau of Economic Analysis data.

State	Average Cost of Living
Alabama	$47,096
Alaska	$66,356
Arizona	$56,211
Arkansas	$46,259
California	$67,565
Colorado	$66,448
Connecticut	$66,645
Delaware	$60,131
Florida	$62,618
Georgia	$52,806
Hawaii	$60,711
Idaho	$48,098
Illinois	$60,612
Indiana	$51,821
Iowa	$49,473
Kansas	$51,082
Kentucky	$48,901
Louisiana	$50,454
Maine	$63,046
Maryland	$58,310
Massachusetts	$71,946
Michigan	$54,197
Minnesota	$58,433
Mississippi	$43,947
Missouri	$54,405
Montana	$58,499
Nebraska	$54,512
Nevada	$56,103
New Hampshire	$68,900
New Jersey	$65,873
New Mexico	$48,119
New York	$66,426
North Carolina	$53,334
North Dakota	$58,090
Ohio	$52,708
Oklahoma	$46,319
Oregon	$58,150
Pennsylvania	$59,260
Rhode Island	$58,041
South Carolina	$51,423
South Dakota	$54,100
Tennessee	$51,507
Texas	$54,060
Utah	$52,677
Vermont	$62,629
Virginia	$58,224
Washington	$62,837
West Virginia	$50,286
Wisconsin	$54,705
Wyoming	$55,543

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How to Budget for a $95K Salary

No matter how much money you earn each year, it’s a smart idea to create a budget. One of the first steps you’ll want to take is to figure out how much money you have left after withholding for federal income taxes, Social Security taxes, and Medicare. On average, the take-home pay on a $95,000 salary is around $75,662.52, though that doesn’t include state taxes.

Once you’ve determined your after-tax income, consider using the 50/30/20 rule for budgeting. This means 50% of your income goes toward needs, 30% goes toward wants, and 20% goes toward savings or debt repayment beyond your minimum amounts.

Let’s say, for example, you live in Massachusetts. Based on an effective tax rate of 16.79% and a marginal tax rate of 22%, your $95,000 salary would equate to a monthly income of $6,209.75. Using the 50/30/20 rule, you’d put the following amounts in the corresponding pockets:

•   50% needs: $3,104.87

•   30% wants: $1,862.92

•   20% savings or debt repayment: $1,241.95

After you have your budget in place, a tool like an online money tracker can help you monitor your spending as well as keep tabs on your credit score.

Maximizing a $95K Salary

Whether you’re earning $95,000 as an entry-level salary or after several years on the job, there are ways to make the most of your income. Here are some strategies to consider:

•   Aim to build an emergency fund that provides a cushion of three to six months of living expenses.

•   Max out your retirement savings account and make sure you’re taking advantage of a company match, if one is available.

•   Explore investing in securities that charge minimal fees.

•   Work on improving your credit score, which can boost your chances of getting competitive interest rates.

Quality of Life With a $95K Salary

While it’s a highly subjective measure, quality of life typically refers to a combination of personal preferences, including job satisfaction, family life, health, and safety. How well you can live on your salary often boils down to your expenses and how and where you choose to spend your money.

Many people with $95,000 salaries find they can live quite comfortably. However, if you spend more than you earn or rely on credit to fund your lifestyle, you may find you have trouble making ends meet on your income.

Is $95,000 a Year Considered Rich?

It depends on who you ask. A 2025 Bankrate survey showed that many Americans do not feel rich with a salary of $95,000. In fact, a third of respondents said they’d need to earn an average of at least $150,000 per year to feel financially secure, and 67% said they would need to make $200,000 or more per year to feel rich.

Note that it’s possible to accumulate wealth if you’re earning $95,000 a year, though it may take some time. Common strategies include relying on investing and compound interest to increase net worth, saving money, and setting money aside in a company retirement plan.

Recommended: Net Worth Calculator By Age

Is $95K a Year Considered Middle Class?

Middle class is defined as income that is two-thirds to double the national median income of $81,604. By that definition, a middle-class household makes between $54,403 and $163,208, and $95,000 is in that range.

However, that’s for the nation. When you drill down to the city and state level, you see that the income required to be middle class varies. For instance, to be considered middle class in San Francisco, you’ll need to earn between $93,980 and $281,940 since the median household income is about $140,970. In Washington, D.C., the median household income is about $109,870. To be middle class there, you would need to earn between $73,250 and $219,340.

Example Jobs that Make About $95,000 a Year

Many career types fall into the $95,000 salary range, including jobs for introverts. Here are some examples of careers you can pursue, which require a range of degree levels from associate to graduate:

•   Financial Analyst: $101,910 per year

•   Industrial Engineer: $101,140 per year

•   Radiation Therapist: $101,990 per year

•   Occupational Therapist: $98,340 per year

•   Civil Engineer: $99,590 per year

•   Architect: $96,690 per year

The Bureau of Labor Statistics offers an occupation finder in its Occupational Outlook Handbook, which you can filter to show jobs with median pay over $80,000.

The Takeaway

Is $95K a good salary for a single person? By and large, yes, but your spending habits, budgeting skills, and local cost of living can all impact how far your money goes. With careful budgeting and saving, you can make the most of your income.

Take control of your finances with SoFi. With our financial insights and credit score monitoring tools, you can view all of your accounts in one convenient dashboard. From there, you can see your various balances, spending breakdowns, and credit score. Plus you can easily set up budgets and discover valuable financial insights — all at no cost.

See exactly how your money comes and goes at a glance.

FAQ

Can I live comfortably making $95K a year?

Many people can live comfortably making $95,000 per year. However, it depends on several factors, including where you live, how much you spend, and where you put your money. Those who live within a budget feel the most comfortable with that salary.

What can I afford with a $95K salary?

Let’s target one of the most expensive assets most people own: a home. You may wonder how much house you can afford without stretching yourself.

According to the 28/36 rule for managing debt, on a $95,000 salary, you should spend no more than $2,216 on housing per month.

How much is $95K a year hourly?

If you work eight hours a day, a $95,000 salary breaks down to $45.50 per hour. This figure might not help you budget or understand your overall income, but it’s interesting to analyze.

How much is $95K a year monthly?

You’ll bring in $7,916.67 per month with a $95,000 per-year salary. It’s important to note that this is before any taxes and is not your take-home pay.

How much is $95K a year daily?

You’ll earn $364 per day with a $95,000 salary. Like with your hourly rate, you might find this number difficult to help you budget or for use in a net worth calculator by age, but it’s interesting to know.

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Photo credit: iStock/JLco – Julia Amaral

SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.

*Terms and conditions apply. This offer is only available to new SoFi users without existing SoFi accounts. It is non-transferable. One offer per person. To receive the rewards points offer, you must successfully complete setting up Credit Score Monitoring. Rewards points may only be redeemed towards active SoFi accounts, such as your SoFi Checking or Savings account, subject to program terms that may be found here: SoFi Member Rewards Terms and Conditions. SoFi reserves the right to modify or discontinue this offer at any time without notice.

Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

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

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Money orders are a highly accessible way of sending and receiving money, even if they may not be the most common tool. To cash a money order at no charge, you can go to your local post office branch, bank, credit union, or even some retail stores.

This article outlines where to cash postal money orders and what the process involves.

What Is a Postal Money Order?

A postal money order is a paper-based financial certificate that the United States Postal Service (USPS) issues. Similar to a paper check, the document is worth the amount of money that the purchasing person or company specifies. Although you can obtain a regular money order from almost any bank, only the USPS issues postal money orders.

Unlike a personal check, a postal money order can’t bounce because the sender must pay the full amount upfront. Additionally, money orders never expire. The purchaser receives a receipt that enables the refund or replacement of a lost, stolen, or damaged money order. As a result, you can use a postal money order to send a payment through the mail securely.

Another advantage of money orders is that they’re difficult to counterfeit. You can make a payment of up to $1,000 with a single order.

To send a money order, you must pay for it ahead of time using cash, a debit card, or a traveler’s check. Although it’s possible to buy a regular money order with a credit card, you can’t put postal money orders on a credit card.

Recommended: What Is a Niche Bank?

How to Cash a Postal Money Order Step by Step

If you receive a postal money order, you can redeem its face value by cashing it. There’s no benefit in keeping a postal money order long term because it doesn’t earn interest, and you can’t use it directly to make a purchase.

Here’s how to cash a money order at the post office free of charge:

1.   Bring your money order and a photo ID to a post office service counter.

2.   Sign the money order in front of the postal worker (and not ahead of time).

3.   Receive the cash value of the money order immediately.

Where to Cash a Postal Money Order

You can also cash a postal money order at most banks, provided you have an account there, and at some grocery stores and retailers.

Most financial institutions don’t allow depositing money orders via mobile banking apps because they require in-person ID verification.

List of Places That Cash Money Orders

Here are some locations that may cash a postal money order:

•   Most banks: Check with your local branch.

•   Check-cashing retailers: Those who don’t have a bank account or a post office nearby may cash money orders here for a fee.

•   International postal offices: The post office offers special international money orders that you can cash in at banks and post offices in some countries.

•   Rural mail carriers: Mail carriers may cash money orders for rural customers if they have enough cash on hand.

•   Some supermarkets and major retailers: Search online for “places to cash a money order near me.”

Recommended: Alternative to Traditional Banks

How to Identify a Fake Postal Money Order

You should examine your money order before attempting to deposit it to ensure it’s authentic. Here are a few ways to spot a fraudulent postal money order.

•   Look closely at the paper: Valid postal money orders have special markings and designs to prevent fraud. Visit USPS.com to view a sample money order.

•   Review the amount: Faded or excessive dollar amounts are key indicators of fraud. All postal money orders must be under $1,000 and have the sum imprinted twice. International postal money orders can’t exceed $700, or $500 for El Salvador and Guyana.

If you think your postal money order is fake, contact the U.S. Postal Inspection Service at 1-877-876-2455.

Recommended: 7 Ways to Cash a Check Without a Bank Account

The Takeaway

Cashing a USPS money order is straightforward. Your local post office can cash it at no cost to you. You may also be able to cash a postal money order at a bank branch if you have an account there or at your local supermarket. If you receive a postal money order, before you deposit it, look closely at it and review the amount to ensure it’s authentic.

Take control of your finances with SoFi. With our financial insights and credit score monitoring tools, you can view all of your accounts in one convenient dashboard. From there, you can see your various balances, spending breakdowns, and credit score. Plus you can easily set up budgets and discover valuable financial insights — all at no cost.

See exactly how your money comes and goes at a glance.

FAQ

Can you mobile deposit a USPS money order?

Unfortunately, you can’t use mobile deposit for USPS money orders. You must deposit them in person with a valid ID.

Where can I cash a money order for free?

You can cash a postal money order for free at your local post office. You may also be able to cash it at your local bank branch.

Can you cash a money order online?

You need proof of ID to deposit postal money orders. Therefore, you can’t deposit them online.

How do I know if a money order is fake?

Valid postal money orders have special markings and designs, so you should look closely at the paper before attempting to deposit it. You can also check the amount on the money order, as it shouldn’t exceed $1,000.

Is it easy to cash in a money order at the post office?

Yes, cashing in a money order is a simple process. Just present your ID to the postal worker at the counter and sign the money order in front of them. You’ll receive the cash right away.

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About the author

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Photo credit: iStock/Delpixart

SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.

*Terms and conditions apply. This offer is only available to new SoFi users without existing SoFi accounts. It is non-transferable. One offer per person. To receive the rewards points offer, you must successfully complete setting up Credit Score Monitoring. Rewards points may only be redeemed towards active SoFi accounts, such as your SoFi Checking or Savings account, subject to program terms that may be found here: SoFi Member Rewards Terms and Conditions. SoFi reserves the right to modify or discontinue this offer at any time without notice.

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

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

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