Jun
12
2023
Daily Simple Interest: What Are Daily Simple Interest Loans?

Daily Simple Interest: What Are Daily Simple Interest Loans?

By | Financial Independence, personal_loan, Terminology | Comments Off on Daily Simple Interest: What Are Daily Simple Interest Loans?

If you have a daily simple interest (DSI) loan, the word “daily” indicates that interest is calculated every day. Thus, the amount you owe on a DSI loan increases with each passing day.

However, because DSI loans use a simple interest calculation, interest does not compound. It’s important to learn how to calculate daily simple interest so you know how much you will owe on a DSI loan.

Daily Simple Interest (DSI) Explained

When you take out a loan, you likely expect to pay interest in addition to the original amount of the loan. However, the way interest is calculated is not the same for all loans.

With daily simple interest, only the remaining balance (principal) on the loan is used in the calculation. This is different from compound interest, where interest that accrues is added to the principal and thus included in subsequent interest calculations.

Because DSI loans calculate interest daily and only use the principal in the calculation, paying on time will help you pay off the loan more quickly than making late payments. Paying early will be even more beneficial, as will paying more than the minimum.

How to Calculate Daily Simple Interest

If you take out a loan with daily simple interest, it means interest will be calculated every day on the loan. In addition, interest is only calculated using the principal of the loan.

Simple interest is calculated as:

I = P * R * T

And:

P = Principal
R = Daily interest rate
T = Time between payments

The last part of the formula, T, is the time between payments. That refers to the amount of time that interest has been accruing. For example, if you pay interest every month, then 30 days may have passed since your last payment. Thus, we multiply the daily interest by 30 and then multiply that rate by the principal to determine how much interest you owe.

What Happens if I Don’t Pay the Daily Simple Interest on My Personal Loan?

If you pay the daily simple interest on your personal loan late, more of the payment will go toward interest, and less of it will go toward reducing the remaining balance. This is because more time has passed, and the loan has accrued more interest than it would have if you had paid on time.

For example, suppose you have a $3,000 loan with a 5% annual simple interest rate, calculated daily. On this loan, you would have $12.33 of interest after 30 days. If you pay $75 toward that loan, you pay the $12.33 interest and reduce the principal by $62.67. But suppose you wait 60 days to pay instead. Interest is still accruing on the original $3,000 principal, so you now owe $24.66 in interest. Now, your $75 payment only reduces the principal by $50.34.

Recommended: Is There a Grace Period for Personal Loans?

Comparing Daily Simple Interest vs Fixed Interest

Daily simple interest and fixed interest are not mutually exclusive. In fact, DSI loans are usually fixed-rate loans. In other words, the interest rate does not change for the life of the loan. This is common with auto loans and short-term personal loans.

One difference you might see is with mortgages. These loans are usually calculated monthly instead of daily. As a result, paying a few days early won’t reduce how much interest you owe. That said, paying more than the minimum on the mortgage can reduce how much you owe overall.

Comparing Daily Simple Interest vs Variable Interest

DSI loans are usually fixed-rate loans, so your payments won’t change for the life of the loan. Variable interest loans, however, have a rate that fluctuates according to market rates. Monthly payments fluctuate along with the rate, so it may be hard to predict how much you’ll have to pay every month.

Nevertheless, interest rates can be lower on variable-rate loans, especially at the beginning of the loan term. Variable-rate loans are common with mortgages, which again means interest is often calculated monthly instead of daily.

How Do Daily Simple Interest Loans Work?

With DSI loans, you generally make monthly payments. Some of each payment goes toward interest and the rest reduces the principal. The only thing that makes DSI loans somewhat complicated is the fact that their interest is calculated every day. However, this daily calculation also means early payments can help reduce the total amount you pay on a DSI loan.

For example, suppose you take out a $5,000 personal loan with a 36-month term and 12% annual simple interest, calculated daily. We will also assume your monthly payment is $120. If you make your first payment after 30 days, $49.32 goes toward interest, and $70.68 goes toward the principal. However, if you instead make your first payment after 15 days, only $24.66 goes toward interest, and $95.34 goes toward the principal.

Increasing how much you pay also helps you reduce the principal on a DSI loan more quickly. Using the above example, if you paid $240 instead of $120, the interest owed would be the same after both 30 days and 15 days. In other words, all of that extra $120 would go toward reducing the loan’s principal.

Pros and Cons of Daily Simple Interest Loans

Daily simple interest loans can be beneficial for some borrowers, but they aren’t without their downsides.

Pros of Daily Simple Interest Loans

•  Interest does not compound — only the principal is used to calculate interest

•  Early payments can save you money on interest

•  Payments are usually the same amount every month

Cons of Daily Simple Interest Loans

•  Interest rates may be lower on variable-rate loans

•  Late payments mean interest keeps accruing

Pros

 Cons
No compound interest Late payments lead to more interest
Early payments can reduce interest paid Rates can be higher than variable-rate loans
Consistent monthly payments

Examples of Daily Simple Interest Loans

Two of the most common daily simple interest loans are auto loans and personal loans.

Auto Loans

When you finance a new vehicle, the interest on that loan is often calculated using daily simple interest. For example, suppose you have a $25,000 auto loan with 6% interest and a six-year term.

On this loan, your interest for the first 30 days would be $123.29. If you paid $500 after 30 days, $376.71 goes toward the principal, bringing it to $24,623.29. After 30 more days then, the interest charge is $121.43, leading to a slightly higher principal reduction of $378.57. With each monthly payment, you reduce the principal more.

Personal Loans

Personal loans can be used for a variety of needs; two personal loan examples are covering unex pected medical bills and paying for urgent home repairs.

While there are different types of personal loan, they often use daily simple interest. For example, if you take out a $5,000 personal loan with daily simple interest and don’t make a payment for 30 days, the loan will accrue interest for each of those 30 days. However, the principal after 30 days will still be $5,000.

On the other hand, if you made a $250 payment after 15 days, your principal would be reduced to $4,750. Then, interest would be calculated using $4,750 as the principal for the remaining 15 days that month. Hence, you would immediately reduce how much interest the loan accrues each day.

Recommended: Getting Approved for a Personal Loan

More Personal Loan Tips From SoFi:

With a daily simple interest (DSI) loan, interest accrues daily but doesn’t compound. Early payments lead to less interest owed, while late payments increase your interest. DSI personal loans can seem expensive, but they’re a better alternative to more expensive forms of borrowing, such as credit cards.

SoFi Personal Loans have a low fixed interest rate, and loans are available from $5K all the way up to $100K. You can use them for whatever you want: home projects, credit card consolidation, even unplanned events.

SoFi Personal Loans are “good debt,” available whenever and wherever the need arises.

FAQ

How do you calculate daily simple interest?

You calculate daily simple interest by multiplying the principal, the daily interest rate, and the number of days since your last payment. This formula is expressed as I = P*R*T.

Is simple interest charged daily?

Simple interest does not have to be charged daily; it can also be charged monthly or annually. However, daily simple interest is always charged daily.

How does a daily interest rate work?

Daily interest is simply a fraction of the annual interest rate. For example, on a non-leap year, the daily interest on a 15% daily simple interest loan would be 15%/365 = 0.041%. Thus, 0.041% is the amount of interest charged per day.

Photo credit: iStock/fizkes
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financial chart shapes

Ordinary vs Qualified Dividends

By | Growing Wealth, invest, Investing | Comments Off on Ordinary vs Qualified Dividends

The vast majority of dividends are considered ordinary dividends, but some are qualified dividends and the tax treatment is different for each.

While sorting out which type of dividend you have can be confusing, it’s important to know the difference as they are taxed at different rates: Qualified dividends are taxed at the preferential capital gains rate, while ordinary dividends are taxed as income.

How Are Dividends Paid?

Typically, dividends are paid in cash, and they’re sent by the company directly to your brokerage, which will deposit the money into your account. Or many companies mail checks directly to investors who own shares in their firms.

Alternatively, you might get dividends as additional shares of stock. Some companies and mutual funds offer the option of a dividend reinvestment plan (DRIP) that will automatically buy additional shares with your dividend payment. This has the advantage of both simplifying the process (since you won’t have to receive the cash and then buy more shares yourself), and potentially being less expensive, since many DRIP programs don’t charge commissions.

Additionally, some DRIP programs offer the ability to buy additional shares at a discount.

Less commonly, a company might award a property dividend instead of cash or stock payouts. This could include company products, shares of a subsidiary company or physical assets the company owns.

Recommended: Capital Gains Tax Guide

What Is a Qualified Dividend?

Certain dividends from holding shares of stock in domestic companies and some foreign companies — and which an investor has held for a minimum period of time — are qualified dividends.

Qualified dividends are taxed at a lower rate than ordinary dividends. They’re taxed at the long-term capital gains rate, which ranges from 0% to 20%. Most people won’t pay more than 15% on qualified dividends. As such, investors typically prefer to receive qualified dividends, but they’re the less common kind of dividend paid out.

Qualified dividends must meet certain requirements:

•   The dividend must be paid by a U.S. company or a qualified foreign corporation.

•   The dividend must not be of the type that does not qualify.

•   If you hold common stock, you must have held the shares for more than 60 days during the 121-day period starting 60 days before the ex-dividend date. (That’s the date by which an investor must have purchased shares of a stock in order to receive an upcoming dividend.)

•   If you hold preferred stock, you must have held the shares for more than 90 days during the 181-day period starting 90 days before the ex-dividend date.

•   A mutual fund must have held the investment unhedged for more than 60 days during the 121-day period starting 60 days before the ex-dividend date, and investors must have held their shares of the mutual fund for the same period.

How to Figure Out If You Have a Qualified Dividend

For investors about to count the number of days they’ve held a stock, be sure to include the day they sold the stock, but do not include the day they bought it.

Here is an example:

Imagine you bought 1,000 shares of ABC Company common stock on July 2, 2021, and you sold the 1,000 shares on August 11, 2021. ABC Company paid a cash dividend of 25 cents per share with an ex-dividend date of July 15, 2021.

Your Form 1099-DIV from the company shows $250 in box 1a (ordinary dividends) and in box 1b (qualified dividends). However, you only held shares of ABC Company for 40 days of the 121-day period that began 60 days before the ex-dividend date, so you have no qualified dividends from ABC Company.


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What Is an Ordinary Dividend?

Once you understand qualified dividends, it’s easy to spot the difference between ordinary dividend vs. qualified dividend: Any dividend that isn’t a qualified dividend is considered an ordinary dividend — and that’s most of them.

In general, investors should assume that any dividend they receive is an ordinary dividend unless they’re told otherwise. The payer of the dividend is required to identify the type of dividend when they report them on Form 1099-DIV at tax time. (Qualified dividends are reported in box 1b on IRS Form 1099-DIV, while ordinary dividends are reported in box 1a.)

Certain kinds of dividends are not qualified dividends even if they’re reported in box 1b of your Form 1099-DIV, according to the IRS. The following dividends are on this list:

•   Capital gains distributions

•   Dividends paid on deposits with mutual savings banks, cooperative banks, credit unions, U.S. building and loan associations, U.S. savings and loan associations, federal savings and loan associations, and similar financial institutions

•   Dividends from a corporation that is a tax-exempt organization or farmer’s cooperative during the corporation’s tax year in which the dividends were paid or during the corporation’s previous tax year

•   Dividends paid by a corporation on employer securities held on the date of record by an employee stock ownership plan (ESOP) maintained by that corporation

•   Dividends on any share of stock to the extent you are obligated (whether under a short sale or otherwise) to make related payments for positions in substantially similar or related property

•   Payments in lieu of dividends, but only if you know or have reason to know the payments are not qualified dividends

•   Payments shown on Form 1099-DIV, box 1b, from a foreign corporation to the extent you know or have reason to know the payments are not qualified dividends

Ordinary dividends must be reported on IRS Form 1040, line 3b, and they are taxed at ordinary income rates, which range from 10% to 37%.


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How Qualified and Ordinary Dividends are Reported at Tax Time

Generally, an investor will receive a Form 1099-DIV — “Dividends and Distributions” — from each institution or company that pays a dividend of $10 or more. This form reports your capital gains distributions, dividend and non-dividend distributions, and any taxes withheld from your payments during that tax year.

Even if an investor does not receive a 1099-DIV from a company, they are still required to report any dividends on their tax return.

On Form 1099-DIV, dividends are reported as follows:

•   Box 1a: Ordinary dividends, representing the total dividends paid to you during that tax year

•   Box 1b: Qualified dividends, and this will be the portion of total dividends that qualify for the lower tax rate

•   Box 3: Non-dividend distributions, which are a nontaxable return of capital

If you have had taxes withheld from your dividends, this will be reported in box 4.7.

The Takeaway

Understanding qualified versus ordinary dividends can help investors make decisions about what account to hold their dividend-paying investments in: Inside a retirement account, such as an IRA, an investor will owe no taxes on dividend income, but they’ll often pay ordinary income taxes on all withdrawals.

Outside a retirement account, an investor will pay lower rates on qualified dividends, and may be able to use dividends to supplement other income or to reinvest in their portfolio.

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Top 10 Fun Things to Do When Visiting Seattle

By | Budgeting & Goals, credit card | Comments Off on Top 10 Fun Things to Do When Visiting Seattle

Seattle may be best known for rain and coffee, but it has so much more to offer and can make a terrific vacation destination. Popular things to do in Seattle include riding to the top of the Space Needle, visiting the Museum of Pop Culture, and strolling through the Chihuly Garden and Glass Museum. Seattle also has a few fun and unique things that you can’t find in most other cities, like the Gum Wall at Pike Place Market.

If you’re thinking you might like to head west to visit this city, check out this advice on the top things to do in the city, plus advice for making your visit a smooth, exciting, and memorable one.

Best Times to Go to Seattle

Spring, summer, and early fall are the best times to go to Seattle, with summer travel being the most popular. Temperatures during these times are pleasant, in the high 60s and low 70s, and there’s little rain.

There are plenty of festivals happening in the summer, too, which might be fun to check out while in Seattle, including:

•   Beyond Wonderland electronic music festival (June)

•   Northwest Tune-Up bike, beer, and music festival (July)

•   Capitol Hill Block Party music and arts festival (July)

•   Watershed country music festival (August)

Bad Times to Go to Seattle

Seattle is known as the “rainy city,” and fall and winter can be chilly and wet. November and December are the rainiest months of the year in Seattle.

However, if you’re on a budget, hotel prices may be lower during the winter. If you’re looking for how to save money on hotels in Seattle and you are focusing on indoor activities, then going during the off-season can be an affordable option.

Average Cost of a Seattle Vacation

Seattle can be an affordable city to visit, depending on how you travel. Typically, a one-week stay will cost around $1,364 for one person and $2,728 for two. Plan on daily costs of around $195. Some specifics to note:

•   A hotel in a central location like Downtown Seattle, near Pike Place Market, can be over $400 a night during peak season.

•   If you’re looking for cheaper hotels, then try neighborhoods outside of central Seattle, but you may need to rent a car for these.

•   If you’re saving up money ahead of time for a Seattle vacation trip, you may be wondering where to keep your travel fund. High-yield savings accounts and regular savings accounts are two popular places to keep your funds.

•   Although “book now pay later” travel options may be tempting, it can be more financially responsible to save money ahead of time so that you don’t pay extra in interest.

If you’re thinking about booking a trip to Seattle but are worried that you may have unforeseen circumstances and have to cancel your trip, you can look into travel insurance. If you pay for your trip with certain credit cards, they may provide travel insurance for certain situations. You should understand how credit card travel insurance works when deciding whether to purchase private travel insurance or use your credit card protections.

10 Fun Must-Dos in Seattle

There is a lot to do in Seattle, and fortunately, it’s a fairly walkable city. There are buses, streetcars, a light rail system, a monorail, ferries and water taxis to help you get around.

The following recommendations for the top 10 fun things to do while visiting Seattle are culled from frequent visitors to the city, residents, and the top-rated attractions based on online reviews. Ready? Here are some must-see destinations in the city.

1. Scale the Space Needle

Perhaps Seattle’s most visible iconic structure, the Space Needle was originally built for the 1962 World’s Fair. From the top, you can see incredible views of the city through the glass walls of the structure.

The Space Needle is located in the Lower Queen Anne neighborhood. It’s open year-round, and hours vary by day and time of year; depending on the time and ticket type, costs vary between $22.50 and $42.50. Discount bundle packages are available for tickets for the Chihuly Garden and Glass Museum and the Space Needle. spaceneedle.com/

2. Stroll Through Pike Place Market

Pike Place Market is Seattle’s most famous market and is the most visited landmark in the city. The market is famous for fish, which has been sold there open-air since 1930, and you may know of the tradition of the catch of the day being thrown around by fishmongers. But the market also hosts many other vendors selling things like jewelry, artwork and clothing, plus all kinds of food, from candied salmon jerky to freshly fried donuts.

Pike Place Market stretches across nine acres within Seattle’s central business district. It’s one of the best free things to do in the city. Hours vary but most of Pike Place Market is active from 10 am to 5 pm, with some restaurants staying open later for dinner and some opening earlier for breakfast. Pike Place Market is open 7 days a week except for Thanksgiving and Christmas Day.

Pike Place Market is also home to the famous Gum Wall, which is a wall within an alleyway that is completely covered in chewing gum. The Gum Wall started in the 1990s when local patrons and performers would stick their used gum on the wall. It’s now a popular photo location.

Pike Place Market can get quite crowded, especially on weekends, so plan accordingly. pikeplacemarket.org/about-pike-place-market/plan-your-visit/

3. Gaze at Gorgeous Glass

The Chihuly Garden and Glass museum is a unique museum that showcases the work of renowned glass artist Dale Chihuly, who lives in Seattle. Both indoors and out, the museum shows off Chihuly’s brilliantly colored, fancifully shaped works which have been exhibited around the globe. The outdoor garden blends plants and flowers with glass pieces intertwined.

The museum is located next to the Space Needle at Seattle Center in the Lower Queen Anne neighborhood. It’s generally open from around 10 am to around 6 pm year-round. Depending on the date and ticket type, costs range from $22.50 to $37.50. Discount bundle packages are available for tickets for the Chihuly Garden and Glass Museum and the Space Needle; you may want to put these costs on your favorite kind of plastic and earn credit card rewards. chihulygardenandglass.com/

4. Find the Fremont Troll

This famous troll statue, which is 18 feet tall, is under the Aurora Bridge in Seattle’s cool, indie Fremont neighborhood. It’s a fun photo-op, for sure, but you can also have fun popping into the neighborhood’s vintage stores and boutiques.

5. Take a Beneath the Streets Tour

Here’s one of the best things to do in Seattle for adults: Take a Beneath the Streets Tour. You’ll go underground and learn about the Red Light District. Basically, you’ll be immersed in the city’s early history of prostitution, drinking, gambling, and crime, which provides a fascinating glimpse at forbidden aspects of Seattle’s past, if you’re game for that.

The tour is available 7 days a week, except for Christmas day, with ticket prices running in the $25 to $27 range. beneath-the-streets.com/

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6. Visit the Ballard Locks

Take a visit to the busiest lock system in the nation: The Ballard Locks (ballardlocks.org/) link the Puget Sound with Lake Washington and the Ship Canal. You can picnic nearby or just hang out and watch boats rise and fall with the waters of the lock system as they navigate to their next destination. It’s a cool, free thing to do while in Seattle. If you’re there in the summer, you can see the famous Salmon Ladder (ballardlocks.org/fish-salmon-ladder.html) in action, as three species of the fish rush through the network of water “ladders” to spawn upriver. Visitor Center hours vary by date.

7. Plug into Pop Culture

Here’s a fun thing to do in Seattle: Pop into the Museum of Pop Culture, or MoPOP, where you can learn more about culture today and in the recent past. Exhibits cover such tops as rock music (hello, Nirvana and Pearl Jam!) and science fiction and fantasy worlds.

The museum is open daily except for Wednesdays, between 10 am and 5 pm. Ticket prices vary by date, typically between $26.25 and $30.25. mopop.org/

8. Ride the Great Wheel

Want a stunning view of the city, plus a fun ride? The Seattle Great Wheel, located on Pier 57 in Seattle, ought to do the trick. It’s one of the largest Ferris wheels in North America, standing 175 feet tall and extending 40 feet out over Elliot Bay, so it’s quite literally a top thing to do in Seattle.

Bonus: It features fully enclosed, air-conditioned gondolas so you can climb aboard, no matter what the weather. As you go around, you’ll enjoy sweeping views of the city, the Pacific Ocean, and the Olympic Mountains, gaining an appreciation for the city’s unique location and its beauty.

The Seattle Great Wheel is open daily from 11 am to 9 pm. It costs around $12 for youth to $17 for adults. seattlegreatwheel.com/

9. Wander Through the Washington Park Arboretum

Here’s a great free thing to do in Seattle: Act like a local, and spend a few hours in the Washington Park Arboretum’s 230 acres. It’s home to a stunning array of trees, plants, and flowers, including some that are found nowhere else in the Northwest. Located on the shores of Lake Washington, the arboretum is open during daylight hours year-round for free. Leashed dogs are allowed in most areas, so if you’re traveling with pets, the Arboretum may be a fun thing to do on your Seattle vacation trip with your pet. botanicgardens.uw.edu/washington-park-arboretum/visit/

While you’re there, don’t miss the Japanese Garden, which is considered one of the best examples of its kind outside of Japan. It’s a beautiful place to stroll among plants, moss, a koi pond, winding paths, stone lanterns, and a meadow area. Admission is $6 for kids and $10 for adults. seattlejapanesegarden.org/

Recommended: What Is a Travel Credit Card?

10. Sip Some Local Wine

California isn’t the only West Coast state known for its wine: Washington is, too, and Woodinville, about 30 minutes from downtown Seattle, is a great place to see and taste for yourself. (You may want to rent a car or explore car services and/or public transportation to get there.)

You’ll find more than 100 wineries and tasting rooms in Woodinville to explore. Winery hours and prices vary, but you can have fun sampling the different varieties produced so close to the city.

The Takeaway

Seattle is a great city with so much to do. Whether you want to explore its natural beauty, eat amazing food, check out museums, shop, or get schooled in its history, you’ll have plenty of options.

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FAQ

What are things to do in Seattle at night?

Seattle has many things to do at night. There are numerous restaurants, bars and clubs throughout the city. The Beneath the Streets Tour would also be a fun and unique activity to do at night. The tour covers underground Seattle and the Red Light District, and may be best suited for adults, as topics include prostitution, drinking, gambling and crime.

What are some things to do in Seattle for kids?

Seattle has a lot to offer for kids and families who are visiting. The Seattle Great Wheel is a popular attraction among children. Finding free activities can be how families afford to travel. Seattle also offers plenty of free or cheap attractions, like visiting the Fremont Troll or watching boats at the Ballard Locks.

What are unique things to do in Seattle?

Seattle has a few fun and unique things that you can’t find in most other cities. Some uniquely Seattle activities include visiting the Gum Wall at Pike Place Market or taking a tour of underground Seattle with the Beneath the Streets Tour.

Photo credit: iStock/Sean Pavone

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Top 10 Fun Things to Do When Visiting San Francisco

By | Budgeting & Goals, credit card | Comments Off on Top 10 Fun Things to Do When Visiting San Francisco

Golden Gate Bridge. Fisherman’s Wharf. Chinatown. While there are plenty of well-known things to do in San Francisco, these are just the tip of the iceberg. As you plan your San Francisco vacation, make an itinerary of the tried and true as well as the hidden gems that only locals know about.

Here, you’ll learn about some of the best things to do in San Francisco, plus tips on making your trip as fun as possible and stretching your budget to the max.

Best Times to Go to San Francisco

Weatherwise, San Francisco is pretty consistent throughout the year. Temperatures range from the 50s to 70s during the day, making a vacation here any time a great idea.

However, you may be more likely to find travel deals if you travel off-season, so outside of the May to August summer season.

While summer travel may be the most popular, there are events in the city throughout the year:

•   February: Chinese New Year

•   April: San Francisco International Film Festival (SFFILM)

•   May: How Weird Street Faire

•   June: San Francisco Pride

•   October: Italian Heritage Parade

•   November to January: Illuminate SF Festival of Light

Bad Times to Go to San Francisco

If you want warm weather for your San Francisco trip, know that you may not get it in summer. Many people assume that because San Francisco is in California, it’s hot come June, July, and August, but sometimes that isn’t true. The weather can change quickly once the sun dips behind the buildings, and the city is known for its fog. Pack a jacket.

While fog and chilly weather aren’t going to ruin most people’s vacations, the unexpected can happen, so you may want to look into travel insurance before you head to the city by the bay. Your credit card travel insurance may cover you, or you could purchase your own policy.

Average Cost of a San Francisco Vacation

As you work on your financial prep for travel, you’ll need to know how much to budget for your San Francisco vacation.

If you’re traveling alone, the average cost for a week in the city is $2,348. For couples, it’s $4,217.

The type of accommodations you choose will impact your budget. Hotels in San Francisco can be found for $82 to $357 a night, although there may be ways you can save on hotels, such as joining a rewards program or applying discount codes. If you prefer a vacation rental (where you can cook to save money), expect to pay $280 to $610 per night.

Recommended: How to Find Book Now, Pay Later Travel

10 Fun and Affordable Must-Dos in San Francisco

San Francisco is made up of distinct neighborhoods such as Japantown, Chinatown, Mission District, Financial District, Haight-Ashbury, and more. You may want to explore a different neighborhood every day on your trip.

Here are 10 fun things to do in San Francisco according to frequent visitors, locals, and top-rated online reviews.

1. Spend Time in Japantown

While its cousin, Chinatown, tends to get all the attention, Japantown in San Francisco is also worth a visit. This is one of only three remaining Japantowns in the country, and here you can find delicious food, cultural events, and plenty of shopping. Whether you’re looking for an authentic kimono, teapot, manga, or Japanese groceries, you’ll find them here. sfjapantown.org/

2. Check out Chinatown

San Francisco’s Chinatown is bustling and crowded. Be sure to snap a photo under the iconic pagoda doorway that marks the start of Chinatown before ambling through the quarter.

After you get your fill of shopping, stop at the Golden Gate Fortune Cookie Factory, a hole in the wall you might miss if you don’t know to look for it. Here you’ll see the employees deftly throwing round batter on a hot skillet and shaping them into those delicious cookies we all know and love. sanfranciscochinatown.com/

3. Don’t Forget Fisherman’s Wharf

Yes, it’s touristy, but yes, you still need to visit this famous area. It’s been around for more than 100 years and now offers many things to see including museums, shops, and restaurants.

A favorite place to spend some time in Fisherman’s Wharf is Musée Mécanique, which offers an impressive collection of old-time arcade games, music boxes, and slot machines. Bring your quarters, and get lost in nostalgia.

After that, you’ll work up an appetite, so head over to one of the many restaurants. Seafood is a must! Restaurants like Cioppino’s, Crab House, and Pier Market Seafood Restaurant offer clam chowder, shrimp, and other delicacies from the sea. If you wind up splashing out on a seafood feast, you might want to pay with plastic to earn and then redeem credit card rewards. fishermanswharf.org/

4. Explore an Amazing Aquarium

After visiting Fisherman’s Wharf, head to the Aquarium by the Bay a short walk away at Pier 39. There are more than 20,000 aquatic critters, including jellyfish, sharks, bat rays, otters, and more.

Explore the aquarium on your own by getting up close and personal with different exhibits including Under the Bay, Sharks of Alcatraz Tunnel, Go With the Flow, and more. General admission tickets are typically $31.75 for adults and $21.75 for kids ages four to 12. aquariumofthebay.org/

5. Get Outdoors at Golden Gate Park

Another of the fun things to do in San Francisco is to spend a few hours in Golden Gate Park. There are over 1,000 acres of meadows, lakes, gardens, playgrounds, and museums. While some of the museums and gardens charge admission, there is plenty available at no cost, making it a fun free thing to do in the city and a way families can afford to travel.

Don’t miss the Bison Paddock, which has attracted visitors since 1892, or the Japanese Tea Garden, which boasts azaleas, cherry trees, and Japanese maples. Incidentally, if you are traveling with a pet, know that most areas (though not buildings) in the park are dog-friendly. sfrecpark.org/770/Golden-Gate-Park

6. Marvel at Mind-Blowing Science

Visiting San Francisco with science lovers? Don’t miss this institution located right at Golden Gate Park in an architecturally amazing building. It includes an aquarium, planetarium, rainforest (yes, a rainforest), and natural history museum under one umbrella. Admission is typically $43.75 for adults; $34.25 for youth.

If you’re looking for something unique to do in the evening in San Francisco, visit one of the California Academy of Sciences’ properties for NightLife ($22.75), which offers the chance to get your science on while enjoying adult beverages and food. calacademy.org/

7. Head Over to Haight-Ashbury

For the hippies at heart, no San Francisco trip is complete without a visit to the iconic Haight-Ashbury neighborhood. This is where flower power sprang up, and where you can now find quirky boutiques, restaurants and brightly painted Victorian buildings.

8. Peruse the Painted Ladies

A beautiful juxtaposition between modern and historic San Francisco, the Painted Ladies are a row of Victorian houses painted in cheerful colors near Alamo Square Park. Consider having a sunset picnic in the park to get a great opportunity to see and shoot the ladies in the golden light. It’s a wonderful bit of architecture that San Francisco is known for.

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9. Fuel Up at the Ferry Building Marketplace

Foodies, this is one of the top things to do in San Francisco. On the Embarcadero at Market Street, you’ll find the Ferry Building Marketplace. Inside, you’ll find a wealth of artisanal food shops and eateries, as well as a farmer’s market and events.

Get your coffee fix with local legend Blue Bottle Coffee, then splurge on a delicious vegan donut at Donut Farm, known for flavors like Orange Creamsicle and Lavender Earl Grey. Or go for lunch at Grande Creperie or Delica. You’ve got options! ferrybuildingmarketplace.com/

10. Hop on a San Francisco Cable Car

One of the best things to do in San Francisco is to take the quintessential cable car. This historic form of transportation has been getting people around the city for nearly 150 years.

Be sure to stay on until the car turns around at the Powell/Mason Cable Car Turnaround. Here, the car will be manually turned on a large wooden circle so it can make the return journey. Tickets are $8 for passengers age 5 and up. sfmta.com/getting-around/muni/cable-cars

The Takeaway

San Francisco is the ideal vacation spot because it appeals to foodies, history buffs, science lovers, and anyone who enjoys a good walk in a park. The bonus? You’ll get your steps in if you choose to walk up and down its picturesque hills!

SoFi Travel is a new service exclusively for SoFi members. Through a partnership with Expedia, we make it easy to find the lowest rates and book your reservations — for flights, hotel rooms, car rentals, and more — all in one place. Earn 2x rewards when booking with your SoFi Mastercard or debit card. And when you redeem your SoFi rewards for travel, you get a 25% bonus: $100 of reward points are worth $125.

Wherever you’re going, get there with SoFi Travel.

FAQ

What are free things to do in San Francisco?

Enjoy a stroll around Golden Gate Park or picnic with the Painted Ladies at sunset to enjoy the city without spending a cent.

Where should I eat in San Francisco?

San Francisco is a food lover’s paradise. Both Chinatown and Japantown offer great options, and the merchants at Ferry Building Marketplace specialize in artisanal delicacies.

How many days should I spend in San Francisco?

With so much to do, you could easily spend five days in San Francisco. At a minimum, budget three days to see a decent amount of attractions.

Photo credit: iStock/Eloi_Omella

SoFi cardholders earn 2% unlimited cash back rewards when redeemed to save, invest, a statement credit, or pay down eligible SoFi debt.

1See Rewards Details at SoFi.com/card/rewards.

The SoFi Credit Card is issued by SoFi Bank, N.A. pursuant to license by Mastercard® International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

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

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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Jun
12
2023

Top 10 Fun Things to Do When Visiting Honolulu

By | Budgeting & Goals, credit card | Comments Off on Top 10 Fun Things to Do When Visiting Honolulu

Known as “The Big Pineapple,” Honolulu is the capital of Hawaii and a great place for your next vacation. While Honolulu is very much a major city on the island of Oahu, within minutes, you can be exploring the gorgeous, lush countryside that surrounds it.

That means there’s ample opportunities to do everything from visiting historical sites and sampling amazing food to snorkeling, kayaking, or climbing waterfalls. To help you develop your itinerary for visiting this tropical paradise, consider the following list of things to do in Honolulu, Hawaii. You’ll also learn travel tips and tricks to make your vacay that much better.

Best Times to Go to Honolulu

With temperatures that rarely rise above the high 80s, Honolulu is temperate throughout the year. The best (and least crowded) times to visit are April, May, September, or October.

Here are some of the annual events in Honolulu you might want to plan your trip around:

•   March: The Honolulu Festival

•   May: The Lei Day Celebration

•   June: The King Kamehameha Floral Parade

•   September: The Aloha Festival

•   October: Hawaiʻi Food and Wine Festival

•   December: Honolulu Marathon

Bad Times to Go to Honolulu

While temperatures are appealing year-round, some can find the summer sun and warmth a bit oppressive; others find winter a tad too humid.

Also, summer travel can often mean more tourists and therefore more crowded attractions. The rainy season is from November to March, and since many of the best things to do in Honolulu are outdoor activities, this might not be the ideal time to take your Honolulu trip.

Weather is one of the many variables that can impact a trip. If the unexpected happens and you can’t take your trip or things were to go awry once you were in Hawaii, having travel insurance can help you get reimbursed for travel purchases. You might be able to access credit card travel insurance, or you could buy it before your trip.

Average Cost of a Honolulu Vacation

If you’re taking a romantic trip for two to Honolulu, you can expect the cost of a weeklong trip to run about $4,142. It can, of course, cost more or less, depending on your budget.

Renting a vacation home, which can cost from $220 to $1,000 a night, means you can save on food since you can cook in the home. It may, however, cost more per night than a hotel, which averages $100 to $459 a night in Honolulu, though you can often save on hotel costs by being a member of a chain’s rewards program, finding coupon codes, or using other travel hacks.

Other costs to consider include renting a car, airfare, and dining. Of course, attractions are another expense, whether that’s museum admission or chartering a boat.

The prices above don’t include airfare getting to and from the island. Obviously, the cost will vary depending upon where you are flying from and back to, as well as how you like to travel (nonstop or not, which class of service, whether you check bags, and so forth). Signing up for an airline credit card before you book your flights can help you earn points for purchases.

10 Fun Must-Dos in Honolulu

If you’re ready to plan your trip and pack in the best things to do in Honolulu, here is a list culled from travelers’ experiences, locals’ recommendations, and top-reviewed attractions.

One quick tip: If you’re planning on doing some of the pricier activities (say, a scuba or snorkeling expedition), you may want to pay with plastic to earn some credit card rewards.

1. Hike Mānoa Falls

Visiting a waterfall is a highlight of many Hawaiian vacations. One to consider: Mānoa Falls, a short-but-sweet 1.6-mile round-trip hike. It’s especially nice on a hot day, as the entire trail is shaded by bamboo, ferns, and ancient banyan trees. The trail’s incline is steady and can sometimes be muddy, so bring water and wear appropriate shoes.

At the end of the trail is a gorgeous waterfall to enjoy; take time to snap a few photos and catch your breath. Incidentally, there is a sign at the bottom of the falls discouraging visitors from swimming due to possible bacteria in the water; follow guidance and/or do your own research. Also worth noting: There is a $5 parking fee. hawaiitrails.hawaii.gov/trails/#/trail/manoa-falls-trail/225

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2. Soak in the Sunset at Waikīkī Beach

One of the top things to do in Honolulu is visit historic Waikīkī Beach. This is where the first hotel was built in 1901, and since then, it has become a hotspot for vacationers. Even if you aren’t staying nearby, it’s worth an evening visit to watch the pinks, purples, and blues of the sunset melt into the water. If you have kids in tow, hanging out at a beach is a free thing to do in Honolulu, which can be one of the ways families can afford to travel.

Consider having a cocktail at one of the many beachside bars to enjoy the experience.

3. Get Up Close to a Coral Reef

Another must on the list of fun things to do in Honolulu is Hanauma Bay State Park, which has been a protected marine life conservation area and underwater park since 1967. To protect the coral reef and its inhabitants, reservations are now required. There is a $3 parking fee and a $25 park entrance fee.

Once you’re in, you’ll be treated to a short video explaining the history of the park, as well as introducing you to the creatures that call it home. Take the tram down to the shore and spend the day snorkeling over coral reefs. Take an underwater camera so you can capture parrotfish, octopuses, sea urchins, puffer fish, and more. hanaumabaystatepark.com/

4. Swim with the Sharks

Not everyone will consider this one of the fun things to do in Honolulu, but some will enjoy this adventure. Several companies offer snorkel tours that give you instruction in this pursuit, and then, when suited up, you can hold onto a rope along the side of the boat and watch as sandbar sharks, hammerhead sharks, whale sharks, tiger sharks, and more drift by at a safe distance. You may also get the chance to free dive into the water for an extra thrill.

An outing like this, lasting a couple of hours, can cost about $150 per person. You might want to use a travel credit card and get points when paying for pricier activities like these.

5. Tour a Japanese Temple

Oahu has a strong tie to Japanese culture, and nowhere is that more evident than at the Byodo-In Temple. It was built in 1968 to commemorate the 100-year anniversary of the first Japanese immigrants in Hawaii. After paying $5 for adult admission (card only; no cash), tour the gorgeous gardens and temple, ring the giant sacred bell (Bon-sho), make an offering to the Amida Buddha, and feed the goldfish. You can also buy a souvenir in the gift shop. byodo-in.com/

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5. Revisit Pearl Harbor

For many, Honolulu is synonymous with Pearl Harbor, which was bombed in 1941 and is an important date in U.S. history. One of the best things you can do in Honolulu is take a tour and immerse yourself in what happened at Pearl Harbor during World War II. View the wreckage of this historic battle site; visit the Battleship Missouri, where the Japanese surrendered and ended the war; and learn from the WWII museum exhibits.

Ticket prices vary. Admission to the Submarine Museum is $12.99 for kids; $21.99 for adults. Admission to four exhibits and the Visitor Center is $44.99 for kids and $89.99 for adults. https://www.pearlharborhistoricsites.org/

6. Treat Yourself to Something Sweet

After a day of exploring Honolulu, you’ll be ready for a sweet break, and you’ll find that at the famous Liliha Bakery. There are five locations in Honolulu, often offering up to 150 different types of baked goods. Liliha is especially well-known for its craveable cream puffs in flavors like green tea and chocolate. If you go for lunch, save room for dessert! lilihabakery.com/

7. Explore the North Shore

If you’re a surfer (or surf-watcher), North Shore is the place to be. If you’re a beginner, you can take a surf lesson. If you’re a spectator, there are surf competitions like Vans Triple Crown of Surfing in the winter.

Not into surfing? No worries. The North Shore is still worth a visit: Haleʻiwa Town is a great place to shop at cute boutiques or grab a shave ice at Matsumoto’s.

8. Savor a Steak

Buzz’s Original Steakhouse has been an Oahu classic since it started serving up its prime cuts in 1962. Located across the street from Kailua Beach Park, Buzz’s is open for lunch, pupu (appetizers) and drinks, and dinner (Note: The website requests no tank tops after 4:30 pm; just sayin’). Fare includes beef spring rolls, poke, rack of lamb, and calamari steak, which cooks up a big portion of the calamari vs. just the tentacles. Buzz’s mai tais are said to be among the best on the island. buzzsoriginalsteakhouse.com/

9. Kayak to Mokoli’i

Mokoliʻi Island, also known as Chinaman’s Hat, is a cone-shaped island that’s a popular destination for visitors. You can kayak to the island, which is a short distance from Kualoa Point. Once you’re there, you can hike to the peak and wave to your friends on the opposite beach.

10. Dine at a Tea House

Here’s another piece of World War II history: the Natsunoya Tea House, which has been a tea house (under a different name) since 1921, was taken over by the U.S. government during the war and converted into a fire and first-aid station. After the war, it reverted to a teahouse. Today, it’s a sushi restaurant, Natsunoya, that also offers banquets and catering. natsunoyahawaii.com/

The Takeaway

For those dreaming of a vacation in Hawaii, Honolulu can bring together the best of big-city amenities and the relaxation of the country. The battle you’ll face is managing downtime with so many fun things to do in Honolulu, from beaches to hikes to historical sites and more.

Whether you want to travel more or get a better ROI for your travel dollar, SoFi can help. SoFi Travel is a new service exclusively for SoFi members that lets you budget, plan, and book your next trip in a convenient one-stop shop. SoFi takes the guessing game out of how much you can afford for that honeymoon, family vacation, or quick getaway — and we help you save too.


SoFi Travel can take you farther.

FAQ

What sweets is Honolulu known for?

People with a sweet tooth will be spoiled for choice in Honolulu. Popular snacks include cream puffs from Liliha Bakery, malasadas (fried dough), shaved ice, and poi donuts (poi is derived from taro root and has a purple hue).

Where can I see a waterfall in Honolulu?

Mānoa Falls is a beautiful and easily-accessible waterfall near Honolulu. Waimea Falls is another option, though it can sometimes be crowded.

How long do I need to see Honolulu?

Plan for a minimum of five days in Honolulu, and more if you plan to visit other spots in Hawaii.

Photo credit: iStock/okimo

SoFi cardholders earn 2% unlimited cash back rewards when redeemed to save, invest, a statement credit, or pay down eligible SoFi debt.

1See Rewards Details at SoFi.com/card/rewards.

The SoFi Credit Card is issued by SoFi Bank, N.A. pursuant to license by Mastercard® International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

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

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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