SoFi

So, you’re a newlywed! Congrats.

You’ve probably been busy planning your wedding ceremony, enjoying your honeymoon, perhaps moving to a new place, and otherwise settling in as a married couple. So, if you haven’t had time to create and agree upon an investment style and strategy, that’s understandable.

Investing as a couple doesn’t mean you need to adopt one another’s investment philosophies and risk tolerance, but it can be extremely helpful to be clear about how one another feels as you create investment goals for your portfolio. (Also consider discussing how you feel about socially responsible investing, as increasing numbers of people feel passionate about aligning investments with their personal ethics.)

As an overview of our tips for newlyweds, we’ll discuss:

•  agreeing upon finances in a marriage

•  sharing financial information with one another and merge investing, as desired

•  creating or build upon an emergency fund

•  investing together (or separately) as a married couple

•  different generations may need different investing strategies

We’ll share seven tips relevant to today’s market, plus how SoFi can help with your investments and financial plan.

Love and Money Tips for Newlyweds

Having a common vision about how to spend, save, and invest money will likely go far beyond simply creating a budget and financial strategy. Agreeing upon money can also be important to protect your marriage. According to PsychCentral.com , money arguments are “by far the top predictor of divorce.”

Citing a study with data collected from more than 4,500 couples, they noted the following:

•  how much money you make and how much you are worth aren’t factors, with money arguments happening at all levels

•  couples take longer to recover from money arguments than any other type

•  couples typically use harsher language during financial-based arguments

•  continuing financial arguments tend to lower the “relationship satisfaction” of a couple

Additionally, Dr. Sonya Britt (professor at Kansas State University) suggests that couples educate themselves about finances, and then create a financial plan for today and for your future. She even suggest financial planning as part of premarital counseling, including a look at one another’s credits reports.

Money.USNews.com suggests, as an important step, that each of you organizes your finances, and then analyze where you are, right now. This might include each person sharing his or her tax returns from last year, recent pay stubs, credit card bills, student loan balances, and more. You could then each create a net worth statement where you list your assets and liabilities.

Because this can be an intimidating process and because your spouse may feel vulnerable when sharing, it’s important to “be respectful, not judgmental” during this discussion. Then, what happens when you combine net worth statements?

What does this comprehensive financial statement look like? How much money is currently in savings? Investment funds? Retirement accounts? (And, during this process, check to make sure you’ve changed beneficiaries wherever it’s needed.)

Agreeing Upon Savings

After you’ve taken a good look at your assets and liabilities, and created a budget, you can gain visibility into how much money you can save and invest. And, here are more money tips for newlyweds. If you aren’t satisfied with how much money you’ve put away into an emergency fund, then it makes sense to focus on that first.

Looking for a place for you and your partner to save money together? With SoFi Checking and Savings® account, you and your +1 can easily merge your finances and continue to get 0.20% APY, no account fees, unlimited ATM reimbursements, and more.

Create specific goals and then set up automatic deposits to make that happen. As you see financial successes as a team, this will likely inspire you to save and invest even more.

In general, an emergency fund should contain enough money for three to twelve times what you spend monthly, with many people suggesting six months’ worth as your target.

Talking About Investment Strategies

As step one, consider why you want to invest. The “why” will help to direct the “what,” because selecting the right investment strategy differs by financial goals.

Saving for retirement is a pretty universal goal, so ask yourself these questions:

•  At what age would you like to retire? If you were born after 1960, the retirement age for full Social Security is 67.

•  How much money (in today’s dollars) would you need to live on each year?

•  How long do you expect to live? That can be a tough question to answer but, statistically, people born in the 1980s have an average life expectancy of 70 for men, 77.4 for women. When planning for retirement, though, it can make sense to plan on 90 for men and 95 for women.

You can use our retirement calculator to help determine, hypothetically, how much you should be investing for retirement.

It may help to think of emergency savings and retirement savings as being the two bookends, and then you can determine what other savings and investment goals you have in between. These can include:

•  buying a home

•  starting a family

•  opening a business

•  traveling

After you’ve determined your goals (be specific!), then you can calculate how much money you’ll need to achieve each one, and on what timetable. Now, reverse engineer to calculate how much you’ll need to save or invest each month to reach your goals.

Compromising on Style

No post on investing tips for newlyweds could be complete without discussing what to do if you have different investing styles, which could include differing levels of risk tolerance.

Maybe she has an aggressive investing style, wanting the biggest return on investment possible, willing to take chances to get that pot of gold—while he may want to increase financial wellness but is less comfortable with high volatility.

What’s most important is to openly communicate and seek solutions. These could include:

•  have separate investment accounts, one more aggressive and one more conservative

•  on joint brokerage accounts, the investment strategy could be more moderate

•  keep a more robust emergency fund to help reassure the more conservative member of the couple

Here’s something else to consider. You may be a newlywed couple in your twenties—or in your sixties. Wise investment strategies can vary by generation, and SoFi has an article about investment strategies by generation. And, no matter what generation you are, we invite you to download The SoFi Wealth Investing Guide. This guide provides step-by-step information about investing, including:

•  goal setting

•  understanding tradeoffs between risk and reward

•  learning about different types of investments

•  choosing an investment portfolio

As one more resource, we’ve also created a list of seven investment tips for today’s market. As an overview, they include:

•  Start now, start small: The sooner you start to invest as a couple, the longer you can keep this money invested—which naturally gives it more time to grow.

•  Focus on investing, not on picking stocks: If you’re not comfortable picking individual stocks, that’s okay. You can work with a wealth advisor.

•  Diversify: When you invest in more than one type of investment, you can feel less anxious when the market fluctuates.
Have long-term goals: We covered this earlier in this post, but it bears repeating.

•  Understand your risk tolerance: It’s your money. You’re in control. A quality advisor will work with your risk tolerance, no matter where it falls on the spectrum of conservative to bold.

•  Consult with an advisor: This can help you choose a portfolio of investments that will facilitate your ability to meet your investing goals.

•  Opt for the lowest fees: Investment fees and advisors fees can take a chunk out of earning, so consider choices with limited fees (or even zero management fees).

Investing with SoFi

With SoFi Invest®, you pay zero in SoFi management fees. Absolutely zero. And, you can start online investing with as little as $1. You can also access the SoFi financial advisor team who can help you to create a personalized financial plan.

The curated portfolio will be based on several factors, including your age, assets, and income. We can track your portfolio and adjust it, as needed.

At SoFi, we put your money to work, with benefits including the following:

•  We will work with you to help you achieve goals; that’s because we map out a plan together—and then help you to stick with that plan.

•  We believe in diversification, so we aim to reduce some of your portfolio’s risk by investing in ETFs.

•  When it comes to portfolio selection, we actively manage passive assets to give you the best of both worlds.

•  Plus, we automatically rebalance your investments, as needed.

At SoFi, you can count on real advice from real advisors. Better yet, it’s on the house! You get access to financial planning services with human advisors at no extra charge.

Ready to get started? You can invest with SoFi. Simply make an appointment or call to meet with an advisor.

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External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

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The information provided is not meant to provide investment or financial advice. Investment decisions should be based on an individual’s specific financial needs, goals and risk profile. SoFi can’t guarantee future financial performance. Advisory services offered through SoFi Wealth, LLC. SoFi Securities, LLC, member FINRA / SIPC . The umbrella term “SoFi Invest” refers to the three investment and trading platforms operated by Social Finance, Inc. and its affiliates (described below). Individual customer accounts may be subject to the terms applicable to one or more of the platforms below.
SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2022 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
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Perhaps you’ve found your dream home, or maybe you’re still in the exciting stages of looking for the house you want. In either case, you’re likely thinking about getting a mortgage loan—and you may be wondering if the amount of debt you currently have will become a stumbling block to qualifying for a mortgage.

To qualify for a mortgage, a lender needs to be confident that you can responsibly manage the amount of debt that you’re currently carrying along with a mortgage payment. The formula used to determine that is called a debt-to-income (DTI) ratio.

More specifically, a DTI ratio is the percentage of your qualifying monthly income, before taxes, that is needed to cover ongoing debts. This could include student loan payments, a car payment, credit card payments, and so forth. If the DTI ratio is too high, then a lender may see you as a higher risk.

This post will describe DTI in more detail, including how to calculate yours, what lenders typically like to see, and what might be too much debt to buy a house. We’ll also share strategies to manage your debt and lower your DTI ratio to help you qualify for the house of your dreams.

Understanding How Your DTI Ratio Can Affect Your Mortgage Options

The DTI formula is pretty simple. First, make a list of all your debts with recurring payments. Then, if you’re a W2 earner, take your pre-tax monthly income and divide your monthly expenses by this amount. That percentage is your DTI ratio .

Note that, with a mortgage, to calculate your DTI ratio, you’ll need to have a reasonable estimate of monthly property taxes on the home, insurance (homeowners, for sure, and PMI and flood insurance, if applicable), and HOA dues, if applicable. Even if you wouldn’t necessarily pay those bills on a monthly basis, you’ll need the bill broken down into a monthly amount for DTI calculation purposes. (And remember these are just examples. Your actual DTI, as calculated by a lending professional, may differ.)

If your debt-to-income ratio is too high, it can impact the type of mortgage you’ll qualify for. Each mortgage lender will have their own preferred DTI ratio, of course, and lenders can and do make exceptions based on your unique financial situation. Here’s an explainer on desirable debt-to-income ratios from the Consumer Financial Protection Bureau.

Preparing for When You Need a Mortgage

If you know you’ll want to buy a house within, say, the next year or two, it can be beneficial for you to understand how much home you can afford. This will give you time to manage your finances to make getting a mortgage approval easier. Perhaps you can’t pay off all your debt in that time frame, but there are strategic moves to make to position yourself better when mortgage time is upon you. In addition, consider reviewing our home buyers guide to get a better understanding of everything you need to prepare for your mortgage.

First, be careful. There are plenty of debt-related myths, but let’s address two debt-related realities:

1. Having a lot of debt in relation to your income and assets can work against you when applying for a mortgage.
2. If you are consistently late on debt payments, lenders may question your ability to pay your mortgage on time.

Here are a few tips that can help with some of the most common debt challenges:

Student Loan Debt

If you’re looking to take control of your student loan debt, consider refinancing your student loans into one new student loan with a potentially lower interest rate.

This can make paying back your loans easier, because there is just one monthly payment to make. Plus, with a (hopefully) lower interest rate, you can pay back less interest, overall. And, if you’re concerned about your monthly DTI ratio being too high when you go to apply for a mortgage, you may be able to refinance your student loan to a longer term for lower monthly payments, to reduce your current monthly DTI ratio. (Keep in mind, though, that extending your loan term may mean paying more interest over the life of your loan.)

When you refinance at SoFi, you can combine federal loans with private ones, something not many lenders permit. Request a quote online to see what you can save. Note that SoFi does not have any application fees or prepayment penalties.

Credit Card Debt

When you have a significant amount of credit card debt, the monthly payments can negatively impact your DTI ratio.

If you’re concerned about managing credit card debt payments while paying a mortgage, you could even consider focusing your efforts on getting out of credit card debt before you start the homebuying process.

To manage your credit card debt, and ultimately eliminate it, here are a few debt payoff methods to consider

•  The snowball method. List your credit cards from the one with the lowest balance to the one with the highest. Then, focus on paying off the one with the smallest balance first, while still making minimum payments on the rest. When that first card is paid off, focus on the next one on your list and so forth.

•  Tackling high-interest debt first. Using this method, you list your credit cards from the one with the most interest to the one with the least. Then, focus on paying off the credit card with the highest interest while making minimum payments on the rest. Then tackle the next one, and then the next one.

•  Consolidating credit card debt using a personal loan before you apply for a mortgage loan. When you do this, you’ll have just one loan, and personal loans typically have lower interest rates than credit cards (if you qualify). Ideally, keep credit cards open while only using them to the degree that you can pay off in full each billing cycle. And as with all debt payments, make all personal loan payments on time.

By reducing and managing your credit card debt, you can better position yourself for a mortgage loan on the house of your dreams.

Consolidating Your Credit Card Debt with a Personal Loan

Ready to consolidate credit card debt into a personal loan? SoFi makes it fast and easy, and it only takes minutes to apply. Plus, our personal loans have the following perks:

•  Low rates

•  No fees

•  Access to live customer support seven days a week

•  Community benefits; ask about how, if you lose your job, we can temporarily pause your personal loan payments and help you to find a new job

We look forward to helping you achieve your financial goals and dreams. Learn how a personal loan from SoFi can help.

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The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
SoFi Mortgages are not available in all states. Products and terms may vary from those advertised on this site. See SoFi.com/eligibility-criteria#eligibility-mortgage for details.
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 on credit.
Notice: SoFi refinance loans are private loans and do not have the same repayment options that the federal loan program offers such as Income Based Repayment or Income Contingent Repayment or PAYE. SoFi always recommends that you consult a qualified financial advisor to discuss what is best for your unique situation.
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Hard as this may be to imagine, 75 years ago, we didn’t have anything like today’s modern credit cards. Nowadays, studies are conducted annually to monitor the rising average credit card debt in our country, and this figure is seen as an indicator of the economy and of people’s individual spending habits.

It wasn’t as easy to buy what you needed in the pre-credit card era, and this form of payment has important benefits, including giving users a short window of time to make purchases on credit without paying interest on the balance.

But, the ease of credit card use also makes it ultra-easy to build up a mountain of debt, and the credit card debt spiral can be especially challenging to break. We’ll share more about why that’s so, later on in this post, along with tried-and-true methods to get out of this unwanted spiral of debt.

First, though, we’ll answer two commonly asked questions:

•  What is the average credit card debt this year?

•  How can I get out of credit card debt?

What is the Average Credit Card Debt This Year?

BusinessInsider.com reported on a 2018 study that shared how more than 40% of households in the United States have credit card debt, with the average household having a balance of $5,700. This average varies by where exactly you live in the country.

On the one hand, the percentage of Americans who have credit card debts has been decreasing for the past 10 years. On the other hand, when looking at people who do have this kind of debt, the average amount has been increasing.

Related: What is the Average Debt by Age?

From an economic standpoint, this is useful information to have. This data can also be helpful in allowing you to place your own financial situation into context. And if you’re unhappy with the amount of debt you’re carrying, the real question is how to get out of credit card debt. Fortunately, we’ve got plenty of insights and solutions to share.

First, let’s take a closer look at that average amount of credit card debt: $5,700. This takes into account every household, about 40% of which are in debt. However, if you just count the households in debt that don’t pay off their balances every month, that average debt increases to $9,333.

If you don’t have the means to pay the debt balance off all at once, then as you’re making payments interest keeps accruing, often compounding daily. So, it can be challenging to pay down that debt, especially if you’re making minimum payments or an amount that’s not significantly more than the minimum.

Here are a few more credit card facts to consider:

•  About one in every five adults in the United States has a credit card balance that’s higher than the amount of funds in their emergency savings accounts.

•  Men have, on average, higher credit card balances than women do, about 22% more.

•  About 68% of Americans have credit card debt when they die, on average $4,531. Compare that to the number of people who have mortgage loans when they pass away (37%) and those who have car loans (25%), and you can see how prevalent credit card really is.

Rising credit card debt can be exacerbated when there isn’t an emergency savings account to fall back on, and our cultural climate of consumerism, one where more is always better, doesn’t help.

If you no longer want to be average in the amount of your credit card debt, meaning you want to get out from underneath your debt, there are solutions.

Tips to Get Out of Credit Card Debt

To break the cycle of debt, it’s important to reverse engineer how it works and understand what makes it so challenging to get out of. Credit card companies typically compound interest, which means that interest accrues on the debt, and then you also pay interest on the interest.

Related: What is the Average Credit Card Debt for a 30-Year Old?

To make the situation even more challenging, interest is sometimes compounded daily, and so it’s easy to see how interest can quickly add up. This is true especially when you make minimum payments. It’s even true if you pay more than what’s owed as a minimum payment, but still have a remaining balance. If you’re late on a payment, you’re often charged a late fee, which is added to your balance—and then you’ll owe interest on that new total amount, as well.

So, What Can You Do?

Here are four methods to consider to ultimately pay off your high-interest credit card debt. You can choose the strategy that fits your financial philosophy and needs best, continue paying on all your debts, and then focus on not adding to your credit card debt as you pay down what you currently owe.

Choices include:

•  Debt snowball method: Using this method, you’d rank your credit card debts by outstanding balances. Then, focus on paying off your smallest debt first, and use the sense of accomplishment you’ll feel to fuel your motivation going forward. Then, pay off the smallest of your remaining debts, continuing until you’ve paid off your credit card debt entirely. A Harvard Business Review study showed that people using this method tend to pay off their credit card debts the quickest.

•  Debt avalanche method: In this method, you’d rank your credit cards by the interest rate charged. Then, focus on paying off the card with the highest interest rate first, and then the next highest and so forth. This is also known as the debt-stacking or ladder method.

•  Debt snowflake method: As a different strategy, you can use any extra money collected—from gathering change to a side gig—to pay down your credit card balances.

•  Debt consolidation method: Using this method, you would consolidate your credit cards into one debt, with low-rate personal loans/a>. You can potentially reduce your interest rate by using a personal loan and streamline the number of bills you need to pay monthly.

Here’s another idea to consider. What has been billed to your credit cards that you don’t really need? It’s pretty common to subscribe to a service you think you’ll need but don’t use, or one that you’ll need for a short period of time only.

Yet, until you cancel that service/subscription, the monthly charge will keep getting added to your credit card balance. So, review those monthly charges and consider tools that help identify places you can cut back on expenses.

Personal Loans with SoFi

If, as part of your financial plan, you’ve decided to apply for a low-rate personal loan to consolidate your credit card debt, there are numerous reasons why SoFi could be a great choice. This includes:

•  We don’t charge an origination fee.

•  We don’t charge any prepayment penalties.

•  We make it fast, easy, and convenient to apply for your personal loan online.

•  Live customer service support is available every day of the week.

•  If you lose your job, we can temporarily pause your payments—and even help you find a new job.

•  You can find your rate in just two minutes’ time!

Ready to get started? Apply for your personal loan at SoFi today!

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The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
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 on credit.
No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third party trademarks referenced herein are property of their respective owners.
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Life is filled with tough decisions, including the mother of all: do I live in the now, or save for tomorrow?

It’s tough because this is the decision that generally seals our fate. Most of us would rather not think that far ahead; after all, retirement is decades from now. We often feel that we can’t afford to do both. And the expression “you only live once” (YOLO) is a temptation to put off tomorrow while you live in the moment.

Other ways we put off saving for our future — and this is where it gets heavy — could be the blame game: our parents, our government, the banks, the system. The feeling that everything is already rigged against us makes it easy to live life without an end plan.

If you would like to change your way of thinking, try this splash of cold water: imagine yourself at age 65. Where will you be living? How would you be paying for food, heat and electricity? Will you be existing solely on Social Security (if it’s still around)?

We’re not trying to scare you, even though the thought is scary. In fact, there are solutions to this dilemma that you can put into action today. We’re going to show you that there is a way to have your cake and eat it too. You can save for the future while living your current life to the fullest.

Follow these simple steps to live in the now while saving money for the future.

Start With a Clear Eye

Get a bird’s eye view of your situation and the way you roll by devising a list of questions that get to the heart of the matter. Give serious consideration to the quality of your crib, your wheels, your wardrobe, and other materialistic matters. Don’t forget to asses the even more important stuff, like the degree of your happiness and spirituality, your romantic life, your circle of friends, and so on. You don’t have to share this list with anyone, so don’t be afraid to get really honest.

Divide Your Goals into Categories

Distinguish the goals that address your wants from the goals that will take care of your needs. All of this should be based on your income and financial standing as it is at this moment. Try your list this way:

Bucket list

Write down all the things you want to do before you die, and get busy checking them off. Parasailing? Learning French? Cooking a multi-course meal? No goal should be out of reach. The idea is that, eventually, you will have the satisfaction of having lived your life to the absolute fullest.

Retirement

Make a list of the ways you want to spend your golden years. Will you have the money to cover these goals? What must you do now in order to reach those financial goals? For some perspective, see if your on track for the retirement you want with our retirement calculator.

Budget

Take a cold, hard look at what you’re spending, and where. Include your rent/mortgage, utilities, transportation-related payments, groceries, wardrobe, eating out, and other assorted obligations. See where you can make cuts or reductions, and where you can redirect that spending into a retirement or emergency fund.

You don’t have to cut your budget so close to the bone that you’re life becomes dull; it may take a while to figure out just the right balance between living in the now and saving for the future. It could mean something as simple as brown-bagging your lunch or taking the bus to work instead of your car. You also don’t have to fix any spending that isn’t broken. If it’s working for you, keep it.

Current Income and Savings

To get a good understanding of where you can go from here, make a list of all your sources of monthly income. This includes your take-home pay (after taxes!), your retirement and savings accounts, Flexible Spending Accounts (FSA), and your emergency fund and vacation fund.

Debt

Create a detailed list of what you owe to creditors and lenders every month, including credit cards, school loans, and any other loans. Once organized, you can start deciding on a debt repayment plan that best suits your situation.

Evaluate Your Financial Situation

Be brutal in your estimation of where you stand. Ask yourself if you think you are saving enough for retirement, if you are paying your bills on time, if you are happy with your credit score, and if you have enough disposable income to have the fun you want to have (after your responsibilities are met).

Review and Revise

Once you discover your weak links, you’ll need to figure out how to change, adjust or alter your lifestyle. The emphasis for improvement should be more on the things you need. Once you take care of that, the things you want will be easier to achieve.

Start On Your Spending Cuts

Now that your entire financial life is laid out before you and you’ve realized your priorities, it’s time to get the scalpel. See what you can cut out completely, or at least reduce; see if there is a way to pay off your debt faster.

Adjust Your Plan Where Needed

The closer you watch your spending and the the more proactive you get with monitoring and switching up your budget, the more cash you may see become available for your future. It may take some trial and error, but don’t give up and don’t allow yourself to fall short of your goals. Always keep them in front of you, and understand that sometimes painful changes in your current situation can lead to incredible improvements in your life and your future.

Start an Account to Start Saving Money

Rather than use credit cards for the things you want now (vacations, tech, wardrobe, etc.), open separate savings accounts dedicated to each individual goal. For instance, label one savings account “Trip To France.” Label the next one “My New Laptop.” Even if you can only contribute a few dollars a week, your goal will get nearer with each deposit, and you’ll be able to pay for your goal in sweet cash. That saves you from getting deeper into debt and paying more interest, and helps you save for the future more effectively.

SoFi Checking and Savings®, a checking and savings account, may be able to help you see this through. SoFi Checking and Savings earns you 0.20% Annual Percentage Yield on all your cash and has no account fees.

We work hard to give you high interest and charge zero account fees. With that in mind, our interest rate and fee structure is subject to change at any time.”

Introducing SoFi Checking and Savings®

Sometimes a plan like this can feel overwhelming and even hopeless. It’s a common feeling, but don’t let it get the best of you. Consider getting some help without it costing you a penny. SoFi Checking and Savings can help you track your spending in your weekly dashboard all within the app.

SoFi Checking and Savings is a checking and savings account where you can spend, save, and earn all in one place. Once you are able to stick to your goals and your budget with the help of SoFi Checking and Savings, your lifestyle can change for the better and your financial situation can improve.

Get started with SoFi Checking and Savings!

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External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

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

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2022 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
SoFi Money® is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member
FINRA / SIPC . SoFi Securities LLC is an affiliate of SoFi Bank, N.A. SoFi Money Debit Card issued by The Bancorp Bank.
SoFi has partnered with Allpoint to provide consumers with ATM access at any of the 55,000+ ATMs within the Allpoint network. Consumers will not be charged a fee when using an in-network ATM, however, third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.
SoFi members with direct deposit activity can earn 4.50% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a deposit to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate.

SoFi members with Qualifying Deposits can earn 4.50% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant.

SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.50% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

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

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

Interest rates are variable and subject to change at any time. These rates are current as of 8/9/2023. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet..

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In the era of “treat yourself,” it’s easy to splurge on dinner, concert tickets, a new outfit, or a trip—just put it all on the credit card. With a credit card, spending is easy. But, if you let those charges stack up, you could be facing considerable debt. And you wouldn’t be the only one.

Consumers in the U.S. owed roughly $420.22 billion in credit card debt in late 2018 . Individually, Americans of all ages owe approximately $5,700 per person in credit card debt.

This means that many Americans are spending thousands of dollars paying interest. From August 2017 to August 2018, Americans spent $104 billion in credit card interest and fees alone.

According to a FICO® study individuals age 18 to 24 held around $2,000 in credit card debt. By the time consumers reach their late 20s, this number nearly doubles. Generally, studies have shown that the desire for credit cards increases with age.

As Americans age, their credit card debt increases too, leading to the depletion of savings, and a possible struggle to live off of retirement funds alone. Why are Americans facing more credit card debt than ever before? How can you avoid building credit card debt as you age?

Breaking down data on credit card debt by age group can help provide insight into American spending habits. How is the average credit card debt for a 30-year old different from someone in their 40s or 50s?

We’ve put this guide together to help you learn about the challenges credit card owners are facing in their 30s, 40s, and 50s—including tips for how you can pay off your credit card debt.

Recommended: Tips for Using a Credit Card Responsibly

Credit Card Debt Ages 35 and Under

Welcome to your 20s and early 30s, full of freedom, exploration, and for many Americans, student debt. Millennials, growing up during the Great Recession are saddled with historically high student loan debt and have the smallest average credit card debt of their fellow Americans.

Related: What is the Average Debt by Age?

The average credit card debt for those 35 and under is $5,808 . This makes sense when you consider that the age people are getting married and the age people are purchasing their first homes is increasing.

Millennials tend to be more suspicious of credit card debt—just one in three millennials carry a credit card . Millennials are also more likely than older generations to have student debt—about 41% are repaying student loans. The already heavy student loan burden could explain the hesitance to rely on credit cards.

Credit Card Debt Ages 35 to 44

Americans between 35 and 44 have on average, $8,235 in credit card debt . Many Generation X-ers have bought houses, cars, and started families. They are increasingly consuming and, as life gets busier, growing financial demands can encourage the growth of credit card debt.

As consumers are more and more stabilized in their lifestyle and careers, they tend to grow more comfortable spending money they can’t immediately repay. Additionally, those between the ages of 35 to 44 are more likely to incur medical debt and pay for those medical bills with credit cards.

According to a 2017 survey conducted by NerdWallet, 27 million adults are paying for medical expenses using credit cards, costing an average of $471 in interest per year.

Credit Card Debt Ages 45 to 54

As of 2017, American credit card debt is peaking at the age of 45 to 54. This age group owes an average of $9,096 , as mortgages, auto loans, and children’s educational expenses typically take up an increasingly large proportion of total income.

Saving for retirement is likely to be a primary focus at this age, but with worrying about paying off debt and financing children’s educations, saving for retirement can be put on the back burner.

Credit Card Debt Ages 55+

Nearly seven in 10 Americans over the age of 55 are carrying some form of debt.

And half don’t ever expect to be debt free. The most common type of debt for individuals 55 and older is credit card debt. Getting ahead of credit card debt now becomes even more important as you near retirement. Debt can have serious consequences on a budget in retirement, especially considering retirees bring in less income.

Recommended: When Are Credit Card Payments Due

Ways to Pay Off Your Credit Card Debt

As you plan to pay off your credit cards, it’s important not to underestimate the challenges of your mid-to-late 30s. With growing responsibilities and increasingly complicated finances, it can be easy to fall into debt.

It’s important to organize your budget in a way that allows you to make monthly payments to reduce, and eventually eliminate debt, while still accumulating savings.

One strategy that may be worth trying is the debt snowball method, where you prioritize repayment on your debts from the debt with the smallest amount to the debt with the largest amount, regardless of their interest rates. (While still making minimum payments on all other debts, of course.)

When you pay off the debt with the smallest amount, focus the money you were spending on those payments into the debt with the next lowest balance. This method builds in small rewards, helping to give you momentum to continue making payments. This method is all about giving yourself a mental boost in order to pay off your debt faster. The idea is that the feeling of knocking out a debt balance—however small—will propel you toward paying down the next smallest balance. The con, however, is that you could end up paying more interest with the snowball method, because you’re tackling your smallest loan balance as opposed to your highest interest debt.

The other popular debt method, the avalanche method, encourages the borrower to pay off the loan with their highest interest rate first. While you don’t get that psychological boost that comes with knocking out small debts quickly, paying off your highest interest loans first is the more cost-effective solution of the two.

Another option to consider is to apply for a personal loan. Personal loans are loans that can be used for almost any purpose, whether that’s home improvement, covering unexpected medical expenses, or paying off credit card debt.

Personal loans can be a way to get ahead of debt, since interest rates are typically competitive, especially when compared to high interest credit cards. A personal loan allows you to consolidate debt—simplifying multiple monthly payments with different credit card companies into one monthly payment.

Another strategy to pay off credit card debt is, of course, to cut down on expenses and tighten your budget. When it comes to paying off debt, organization is key.

Make sure you are tracking both your income and your expenses. Take a look at your monthly purchases and try categorizing them into different areas. With some strategic planning, small changes can add up to make a big difference.

Ready to tackle your credit card debt? You can apply to consolidate your debt with a SoFi personal loan.

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The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
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 on credit.
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