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A budget can be a great and necessary way to take control of your finances. It helps you track money coming in and going out, which could mean your spending on necessities, fun experiences, and saving for the future.

While many people prefer a monthly budget, a weekly budget can be a better option for others. It gives added control and flexibility in wrangling your finances. For instance, if you see that you’ve hit your restaurant spending limit by Thursday, you can commit to eating at home for the rest of the week to avoid overspending and coming up short by the end of the month.

Here’s a closer look at how a weekly budget works, the benefits of budgeting this way, along with some potential pitfalls to look out for.

What Is a Weekly Budget

A weekly budget is a way to organize your finances and manage your money on a weekly cycle. It outlines your expected income and expenses for a one-week period and can help you stay on top of your finances and avoid overspending.

To make a weekly budget, you determine your weekly income, how much you need to spend on essentials/fixed expenses for the week, along with how much you will allot for nonessential spending and savings/goals.

For many people, a weekly guardrail like this helps them ensure their cash is tracking properly.

How Weekly Budgets Work

Here are the basis of how a weekly budget works:

•   Figure out your take-home pay per week. This likely requires a bit of basic division since many people are paid bi-weekly or at another cadence.

•   Next, look at your spending on necessities, such as housing, utilities, basic food (but not dining out or those vanilla lattes), minimum debt payments, healthcare, and insurance.

•   Subtract those expenses from your income. See how much is left.

•   From this remaining amount, allocate how much you can spend on “fun” items, such as dining out or takeout, clothing that isn’t vital, entertainment, travel, and the like.

•   Also remember to allocate funds for savings. Many experts recommend a figure of 20% but that may vary depending on your cost of living, debt, and other factors.

•   Now that you see how much money is coming in and how much remains for spending after the needs of life are paid for, you can track and manage your spending and saving weekly to make sure you are hitting your marks.

Benefits of a Weekly Budget

If you think tracking your money with a monthly household budget is a pain, the idea of putting even more effort into the process — and breaking it down by the week — may feel like overkill. But there could be some benefits to be had from the effort.

Here are a few pros and cons to consider:

Pro: More Flexibility

Life doesn’t always follow a schedule. A monthly budget can be a good fit for fixed expenses that are paid once a month (rent and car payments, student loan payments, etc.), or even quarterly or annual bills (insurance payments, subscriptions, and memberships). But other costs, such as dining out with friends, unexpected car repairs, clothing purchases, gifts, or an occasional massage or pedicure splurge, fluctuate from week to week.

With a weekly budget, you can quickly adjust to any changes or overages. For example, if your car suddenly needs a repair, you can rejigger your spending in other categories for the rest of the month to make up for the added cost. Or, if you see you spent more than what you allotted for grocery spending for the week, you may decide to adjust your budget moving forward to reflect your actual spending.

Pro: Planning Around Paychecks

If, like many Americans, you’re paid every week or every other week — or your spouse is — a weekly or biweekly budget could offer more flexibility for saving and spending.

People who are paid weekly have some months with four paychecks and some months with five. Those who are paid every other week have some months with two paychecks and some months with three.

A weekly budget could help pinpoint those extra paydays so you can take advantage of the opportunity to work on a short- or long-term goal. You might stockpile a few grocery-store staples that could help tide you over during leaner months, for example. Or you may want to set aside the money to start an emergency fund. Or you could use it to save for a wedding, honeymoon, or vacation.

Pro: Simplifying Savings

Switching to a budget that aligns with weekly or biweekly paydays also could make saving more manageable.

If you’re enrolled in a 401(k) or similar investment savings plan at work, you may already be making contributions each payday. You could do the same thing with your savings account by setting up automatic transfers and moving money from your checking account to your savings account each week. Ideally, you’ll want this to happen on the same day you get paid.

Or, if your employer offers split direct deposit, you might opt to have some of each paycheck go directly into savings and the rest go into checking. This approach to saving, called “paying yourself first,” removes the temptation to spend money you had allocated for saving in your budget.

Downsides of a Weekly Budget

As you might expect, there are also some cons of a weekly budget. Consider the following:

Con: Too Much Temptation

The added flexibility that can make a weekly budget appealing also could make it easier for some individuals and households to be tempted off course — especially when it comes to discretionary spending. Telling yourself that you’ll spend less “next week” to justify getting what you want right now could become a habit. An important part of successful budgeting is sticking to the budget.

With that in mind, you might want to tuck each week’s discretionary money into an envelope …and when it’s gone, it’s gone. Using a budgeting app to keep track of your expenses on your phone or tablet also could help.

Recommended: Envelope Budgeting Method

Con: Weekly Check-ins Could Become Overwhelming

Taking the time each week to review your purchases and update your budget may not be realistic for some people. If finding time to check in with your budget each week feels too overwhelming you may want to try a bi-weekly or monthly approach.

4 Steps To Create a Weekly Budget

Making a budget — whether it’s set up to be weekly, biweekly, monthly, or a bit of a combo — can be a good way to get control of your finances. Here’s are more detailed steps to setting up a weekly budget template:

1. Pull Together Your Paperwork

If you want your budget to be useful, it should be as accurate as possible. So you’ll probably want to pull together some paperwork to help get it right, including your most recent pay stubs and bank statements, along with utility bills, insurance bills, credit card bills, loan statements, and any other recurring bills you can think of. You may also find it helps to have tracked your spending (on paper or with an app) for a while before you sit down to create your budget. Or you may want to collect recent grocery store, drug store, and restaurant receipts to help you estimate those costs.

2. Calculate Your Weekly Income

Write down all of the income you receive each month. (If you’re married, include your spouse’s income sources. If you’re a freelancer or your income is unpredictable, you may want to calculate the average over the past three or four months.) Find your monthly take-home amount (what you get after taxes and other payroll deductions) and divide it by four.

3. Make a Realistic List of Your Expenses

Using a budgeting program or app, a spreadsheet like Excel, or maybe just a notebook, write down all your expenses for the month. It can help to break down those costs by categories, such as:

•   Housing costs (e.g., rent or mortgage, utilities, and other expenses)

•   Transportation (like car payments, insurance, gas, and maintenance)

•   Food and groceries

•   Costs associated with your children (like child care, tuition, activities), if applicable

•   Financial expenses, such as bank fees or taxes

•   Savings and investing, such as contributions to a 401(k) or IRA or emergency fund

•   Health Care (e.g., prescriptions, dental care, co-pays)

•   Personal spending (like clothes, shoes, gym membership)

•   Entertainment (such as movies, special events, streaming services, books)

Keep in mind that the categories you include in your budget will be influenced by your wants, needs, and spending habits.

You may decide you want to use a monthly budget for some expenses (utility bills and other fixed expenses) and a weekly budget for others (such as discretionary expenses, debt payments, and savings). But if you want to go weekly with everything, the math isn’t all that complicated. To convert monthly amounts into weekly spend amounts, multiply the monthly figure by 12 and then divide by 52.

4. Deduct Expenses from Income

Add up your weekly expenses and subtract that number from your weekly income. If you come out ahead, you could add more to your savings and investments, pay down debt even faster, or add more of a cushion to another category on your list. If you come out even, you may want to adjust your discretionary spending a bit, so an unexpected cost doesn’t throw you off track.

If you come out with a negative number, you may have to make some decisions about what costs you can cut or even get rid of.

Especially when you’re starting out, it may help to use a budget framework similar to the 50/30/20 budget rule, which suggests keeping essential costs to 50% or less, discretionary costs to 30% or less, and setting at least 20% aside for savings if you can. If your percentages aren’t where you want them, you may need to make some adjustments in your spending.

Recommended: 50/30/20 Budget Rule Calculator.

Test the Budget and Adjust

Once you have a budget you feel comfortable with, it’s time to test your new spending and savings strategy. You might decide to use a tracking app to see how you’re doing, but you also may benefit from actually sitting down to go over the numbers once a week. (This could be particularly helpful for married couples who are sharing a couples budget.)

If you spot any problem areas or realize you forgot something, you can always make adjustments. If something happens to change your income or expenses (a raise, a new job, a job loss, a big purchase, or a baby), you can adjust again.

Don’t be discouraged if the budget you built doesn’t work out the first time you use it. You may have to develop new habits. Or you may need to get some help with ditching your debt or determining your financial goals.

The Takeaway

Setting up a weekly budget could make it easier to stay on top of your spending by streamlining the number of transactions you have to track and helping you spotlight any areas you may be overspending in. However, for some, checking in and tracking your spending and transactions each week could become overwhelming. An app, possibly provided by your bank, could help.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 3.60% APY on SoFi Checking and Savings.

FAQ

What should a weekly budget include?

A weekly budget should include your income, your necessary expenses (housing, utilities, food, healthcare, and more), your discretionary expenses (eating out, travel, entertainment), and your savings.

How do you budget weekly money?

To budget money weekly, you will need to divide your take-home pay into weekly amounts and then do the same with your spending on needs and wants, as well as savings. You want to be sure your weekly income can cover those expenditures.

What does having a weekly budget mean?

Having a weekly budget means you are balancing your income, spending, and saving on a weekly basis. This can be a good way to stay in close touch with your money, though for some people it might feel like overkill vs. monthly budgeting.

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

Annual percentage yield (APY) is variable and subject to change at any time. Rates are current as of 11/12/25. There is no minimum balance requirement. Fees may reduce earnings. Additional rates and information can be found at https://www.sofi.com/legal/banking-rate-sheet

Eligible Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Eligible Direct Deposit”) via the Automated Clearing House (“ACH”) Network every 31 calendar days.

Although we do our best to recognize all Eligible Direct Deposits, a small number of employers, payroll providers, benefits providers, or government agencies do not designate payments as direct deposit. To ensure you're earning the APY for account holders with Eligible Direct Deposit, we encourage you to check your APY Details page the day after your Eligible Direct Deposit posts to your SoFi account. If your APY is not showing as the APY for account holders with Eligible Direct Deposit, contact us at 855-456-7634 with the details of your Eligible Direct Deposit. As long as SoFi Bank can validate those details, you will start earning the APY for account holders with Eligible Direct Deposit from the date you contact SoFi for the next 31 calendar days. You will also be eligible for the APY for account holders with Eligible Direct Deposit on future Eligible Direct Deposits, as long as SoFi Bank can validate them.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, Wise, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi Bank shall, in its sole discretion, assess each account holder's Eligible Direct Deposit activity to determine the applicability of rates and may request additional documentation for verification of eligibility.

See additional details at https://www.sofi.com/legal/banking-rate-sheet.
*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.

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.

We do not charge any account, service or maintenance fees for SoFi Checking and Savings. We do charge a transaction fee to process each outgoing wire transfer. SoFi does not charge a fee for incoming wire transfers, however the sending bank may charge a fee. Our fee policy is subject to change at any time. See the SoFi Bank Fee Sheet for details at sofi.com/legal/banking-fees/.
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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If you’re married or in a committed relationship, you may be wondering whether combining your finances with a joint bank account is the right choice, or if it’s better to keep things separate.

Opening a joint checking account can simplify budgeting and spending, especially if you’re sharing household expenses. In SoFi’s 2024 Love & Money survey (which included 450 adults who live with their partners and plan to marry in the next few years), nearly 30% said they already had a joint account with their significant other, and 39% said they were planning to open one.

But joint accounts also have some drawbacks, including loss of financial privacy and independence. If you are mulling over this decision, read on to learn the pros and the cons of opening a joint bank account, as well as what’s required to open this type of account.

 

What Is a Joint Bank Account?

A joint bank account is an account that is shared between two or more people. It allows all account holders to deposit, withdraw, and manage funds, and is often used by couples, family members, or business partners.

Sharing a checking account comes with a number of benefits, including the convenience of managing household expenses and promoting transparency between couples. However, joint accounts also have some potential downsides, such as increased risk for financial disputes and potential strain on the relationship.

One of the biggest decisions a couple will make is whether they decide to treat their money as a shared asset or as separate entities. As with any discussion about money, every individual or couple will have different goals and experiences, so it’s helpful to take a look at both sides. Considering the pros and cons of joint vs separate accounts may help you decide if this kind of account suits you.

How Does a Joint Account Work?

A joint account functions just like an individual bank account, except that more than one person has access to it.

Everyone named on a joint account has the power to manage it, which includes everything from deposits to withdrawals. Any account holder can also close the account at any time. In addition, all owners of a joint account are jointly liable for any debts incurred in relation to the account.

You can open a joint account with a spouse or partner you live with, but you don’t have to be a married couple or even live at the same address to open a joint checking or savings account. For example, you can open a joint account with an aging parent who needs assistance with paying bills and managing their money. You can also open a joint account with a friend, roommate, sibling, business partner, or (if your bank allows it) a teenage child.

What Are Some Pros of a Joint Bank Account?

Here are some of the benefits of opening a joint account:

•  Ease of paying bills. When you’re sharing expenses, such as rent/mortgage payments, utilities, insurance, and streaming services, it can be a lot simpler to write one check (or make one online payment), rather than splitting bills between two bank accounts. A shared account can simplify and streamline your financial life.

•  Transparency. With a joint checking account, there can’t be any secrets about what’s coming in and in and what’s going out, since you both have access to your online account. This can help a newly married couple understand each other’s spending habits and talk more openly about finances.

•  A sense of togetherness. Opening a joint bank account signals trust and a sense of being on the same team. Instead of “your money” and “my money,” it’s “our money.”

•  Easier budgeting. When all household and entertainment expenses are coming out of the same account, it can be much easier to keep track of spending and stick to a monthly budget. A joint account can help give a couple a clear financial picture.

•  Banking perks. Your combined resources might allow you to open an account where a certain minimum balance is required to keep it free from fees. Or, you might get a higher interest rate or other rewards by pooling your funds. Also, in a joint bank account, each account holder is typically insured by the FDIC (Federal Deposit Insurance Corporation), which means the total insurance on the account is higher than it is in an individual account.

•  Fewer legal hoops. Equal access to the account can come in handy during illness or another type of crisis. If one account holder gets sick, for example, the other can access funds and pay medical and other bills. If one partner passes away, the other partner will retain access to the funds in a joint account without having to deal with a complicated legal process.

Recommended: Money Management Guide

What Are Some Cons of a Joint Bank Account?

Despite the myriad advantages of opening a joint account, there are some potential downsides to a shared account, which include:

•  Lack of privacy. Since both account holders can see everything that goes in and comes out of the account, your partner will know exactly what you’re earning and how much you are spending each month.

•  Potential for arguments. While a joint account can prevent arguments by making it easier to keep track of bills and spending, there is also the potential for it to lead to disagreements if one partner has a very different spending style than the other.

•  No individual protection. As joint owners of the account, you are both responsible for everything that happens in the account. So if your partner overdraws the account, you will both be on the hook for paying back that debt and covering any fees that are charged as a result. If one account holder lets debts go unpaid, creditors can, in some cases, go after money in the joint account.

•  It can complicate a break-up. If you and your partner end up parting ways, you’ll have the added stress of deciding how to divide up the bank account. Each account owner has the right to withdraw money and close the account without the consent of the other.

•  Reduced benefits eligibility. If you open a joint account with a teenage child who is going to, or is already in, college, the joint funds will count towards their assets, possibly reducing their eligibility for financial aid. The same goes for an elderly co-owner who may rely on Medicaid long-term care.

How to Open a Joint Bank Account

If you decide opening a joint account makes sense for your situation, the process is similar to opening an individual account. You can check your bank’s website to find out if you need to go in person, call, or just fill out forms online to start your joint account.

Typically, you have the option to open any kind of bank account as a joint account, except you’ll select “joint account” when you fill out your application or, after you fill in one person’s information, you can choose to add a co-applicant.

Whether you open your joint account online or in person, you’ll likely both need to provide the bank with personal information, including address, date of birth, and social security numbers, and also provide photo identification. You may also need information for the accounts you plan to use to fund your new account.

Another way to open a joint account is to add one partner to the other partner’s existing account. In this case, you’ll only need personal information for the partner being added.

Before signing on the dotted line, it can be a good idea to make sure you and the co-owner know the terms of the joint account. You will also need to make decisions together about how you want to manage and monitor the account, such as which account alerts you want to set up.

Should I Open a Joint Bank Account or Keep Separate Accounts?

As you consider your options, know that it doesn’t have to be all or nothing. You might find that the best solution is to pool some funds in a joint account for specific purposes, from paying for basic living expenses to saving for the down payment on a house or building an emergency fund.

You might keep your own separate accounts as well, where you can spend on what you like without anyone watching (or judging). In SoFi’s Love & Money newlywed survey (which included 600 adults who have been married less than one year), the most popular banking set-up, chosen by 42% of couples, was a hybrid approach — having both joint and individual accounts.

Recommended: Emergency Fund Calculator.

The Takeaway

Opening a joint bank account offers convenience by allowing shared access to funds for bills, savings, or everyday expenses. Joint accounts also promote transparency and can simplify money management for couples who share financial responsibilities.

But joint accounts also come with some downsides and potential risks. All transactions on the joint account are visible to both account holders, which can lead to a lack of privacy regarding personal spending habits and potential conflict. Plus, either holder can withdraw money without the other’s consent. If one person mismanages funds, both may be affected.

Some couples choose to maintain separate accounts alongside a joint one for shared expenses to achieve a balance of independence and collaboration.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 3.60% APY on SoFi Checking and Savings.

FAQ

What are the disadvantages of a joint account?

A joint bank account can create financial complications if one account holder mismanages money or racks up overdraft fees, as both parties are equally responsible. Disagreements over spending habits may also come up, which could strain a relationship. Also, in the event of a breakup or divorce, separating funds can become more complicated.

Are joint bank accounts a good idea?

Joint accounts can be a good idea for couples, family members, and business partners who share financial goals and trust each other fully. They simplify bill payments, budgeting, and managing shared expenses. However, they also require communication and mutual agreement on spending. If that trust breaks down or if one person is less financially responsible, problems can arise. Whether it’s a good idea depends on the relationship and financial compatibility.

Is it better to have joint or separate bank accounts?

Whether to have joint or separate bank accounts depends on the relationship and financial habits of the individuals involved. Joint accounts offer transparency and make shared expenses easier to manage, which can work well for couples or family with aligned goals. Separate accounts allow more financial independence and privacy. Some people prefer a hybrid approach — maintain both joint and individual accounts. The best setup depends on trust, communication, and lifestyle needs

Who owns the money in a joint bank account?

In a joint bank account, both account holders have equal legal ownership of the funds, regardless of who deposits the money. This means either person can withdraw or use all the money at any time without the other’s permission.

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About the author

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

Annual percentage yield (APY) is variable and subject to change at any time. Rates are current as of 11/12/25. There is no minimum balance requirement. Fees may reduce earnings. Additional rates and information can be found at https://www.sofi.com/legal/banking-rate-sheet

Eligible Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Eligible Direct Deposit”) via the Automated Clearing House (“ACH”) Network every 31 calendar days.

Although we do our best to recognize all Eligible Direct Deposits, a small number of employers, payroll providers, benefits providers, or government agencies do not designate payments as direct deposit. To ensure you're earning the APY for account holders with Eligible Direct Deposit, we encourage you to check your APY Details page the day after your Eligible Direct Deposit posts to your SoFi account. If your APY is not showing as the APY for account holders with Eligible Direct Deposit, contact us at 855-456-7634 with the details of your Eligible Direct Deposit. As long as SoFi Bank can validate those details, you will start earning the APY for account holders with Eligible Direct Deposit from the date you contact SoFi for the next 31 calendar days. You will also be eligible for the APY for account holders with Eligible Direct Deposit on future Eligible Direct Deposits, as long as SoFi Bank can validate them.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, Wise, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi Bank shall, in its sole discretion, assess each account holder's Eligible Direct Deposit activity to determine the applicability of rates and may request additional documentation for verification of eligibility.

See additional details at https://www.sofi.com/legal/banking-rate-sheet.
*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.

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.

We do not charge any account, service or maintenance fees for SoFi Checking and Savings. We do charge a transaction fee to process each outgoing wire transfer. SoFi does not charge a fee for incoming wire transfers, however the sending bank may charge a fee. Our fee policy is subject to change at any time. See the SoFi Bank Fee Sheet for details at sofi.com/legal/banking-fees/.

¹SoFi Bank is a member FDIC and does not provide more than $250,000 of FDIC insurance per depositor per legal category of account ownership, as described in the FDIC’s regulations. Any additional FDIC insurance is provided by the SoFi Insured Deposit Program. Deposits may be insured up to $3M through participation in the program. See full terms at SoFi.com/banking/fdic/sidpterms. See list of participating banks at SoFi.com/banking/fdic/participatingbanks.

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The marginal propensity to save (MPS) is an important concept in economics that describes how much of each additional dollar of income a person (or economy) chooses to save rather than spend. It plays a central role in Keynesian economic theory and helps economists understand how changes in income affect savings, spending, and overall economic activity.

But beyond theory — does MPS matter to you as an individual saver? Absolutely. Understanding MPS can help you become more mindful of how you handle income increases, whether from a raise, bonus, or side gig. What follows is a more in-depth look at marginal propensity to save, including what it means, why it matters, and how it applies to your personal financial life.

The Keynesian Economic Theory, Explained

British economist John Maynard Keynes revolutionized economic thinking with his 1936 book, The General Theory of Employment, Interest, and Money. His core idea was that economic downturns result from insufficient demand for goods and services, and that government spending can help stabilize the economy.

Keynes advocated for an increase in government spending during recessions and depressions, which would boost the production of goods and services to minimize unemployment rates and enhance economic activity. This theory went against the prevailing and long-held view that markets are self-regulating and any interference by the government could be harmful.

There are three main elements of this theory:

•   Aggregate demand: This is the total demand for goods and services in an economy. If demand drops too low (in other words, there is a lull in spending), a recession may follow.

•   Sticky prices and wages: Prices and wages are often slow to respond to changes in supply and demand, which can prolong unemployment or inflation.

•   Government intervention: Keynes advocated for government interventions like increased spending and lowering taxes to stimulate demand and pull the economy out of a downturn.

The Keynesian Multiplier describes the effect of increased government spending/investment as an economic stimulus. According to the multiplier, an increase in government spending leads to a greater-than-proportional increase in total economic output. In other words, the overall gain of government intervention is greater than the dollar amount spent.

The multiplier effect is directly influenced by the marginal propensity to save (MPS) and its counterpart, the marginal propensity to consume (MPC).

💡 Quick Tip: Tired of paying pointless bank fees? When you open a bank account online you often avoid excess charges.

Calculating Marginal Propensity to Save

MPS measures how savings behavior changes in response to a change in disposable income. The lower the MPS, the higher the multiplier effect of government spending or investment on total output, or gross domestic product (GDP). A low MPS supports Keynes’s premise that government spending can have a powerful effect on increasing aggregate demand and reducing unemployment during recessions.

Knowing the MPS helps policymakers estimate how effective spending or tax changes will be in stimulating the economy. A lower MPS (meaning people spend more and save less of their additional income) amplifies the effects of fiscal policy, which is central to Keynes’s approach to managing economic downturns.

Recommended: 7 Tips to Managing Your Money Better

Marginal Propensity to Save Formula

MPS is calculated with a specific formula:

MPS = Change in Savings / Change in Income.

Marginal Propensity to Save Example

Let’s say you receive a $1,000 bonus at the end of the year. Of that $1,000 increase in income, you decide to spend $300 on new clothes, $200 on a fancy dinner out, and save the remaining $500.

•   Change in income = $1,000

•   Change in savings = $500

•   MPS = $500 ÷ $1,000 = 0.5

This means you saved 50% of your additional income.

Marginal Propensity to Consume

Conversely, the marginal propensity to consume (MPC) is the change in the spending, or consuming amount. If someone’s income increases, the MPC measures the amount of income they choose to spend on goods and services instead of putting into different forms of savings.

The MPC formula is:

MPC = Change in Consumption / Change in Income.

By using the example above, the MPC would be 500 ÷1000 = 0.5.

Since income must be either saved or spent, the following must always be true:

MPS + MPC = 1

What MPS Means for You as a Consumer

While MPS is a tool economists use to measure national saving behavior, it also has implications on your personal finances. Understanding your own MPS can help you evaluate your spending vs. savings habits and take better control of your finances.

For example, if you find that you increase spending in line with any increases in income (meaning your MPS is at or near zero), it’s a sign you may be succumbing to lifestyle inflation, also known as lifestyle creep, which is the tendency to increase spending as income increases. It also indicates that you may want to consider increasing your savings rate — especially for emergencies, retirement, or other financial goals.

💡 Quick Tip: If you’re saving for a short-term goal — whether it’s a vacation, a wedding, or the down payment on a house — consider opening a high-yield savings account. The higher APY that you’ll earn will help your money grow faster, but the funds stay liquid, so they are easy to access when you reach your goal.

Other Factors That Influence Saving

While MPS looks at changes in savings that result from changes in income, consumer savings behavior is influenced by other factors. Here’s a look at some other things that can affect saving and spending that are unrelated to income.

1. Wealth

Wealth (assets and investments) is separate from income. If your wealth increases — say through an inheritance, stock gains, or home appreciation — you may feel more comfortable saving less and spending more, even if your income hasn’t changed.

Alternatively, a decline in wealth might lead to reduced consumption and increased saving as a precaution.

2. Expectations

Future income expectations are also known to influence consumer spending and saving habits. For example, if you expect to get a raise or bonus, you may spend more now. If you fear a job loss or recession is looming, you might decide to tighten your budget. These shifts affect your saving behavior even without actual changes in income.

Debt

People also tend to adjust their consumption and savings if they’re in debt. For example, if you’re carrying high levels of credit card debt, you might be inclined to cut spending and increase savings to pay it down, even if your income hasn’t changed. Conversely, when debt levels are low and borrowing is easy, you may feel more free to spend.

Recommended: What is the Average Savings by Age?

Why Marginal Propensity to Save Matters

Using the data from MPS and MPC helps businesses and governments determine how funds are allocated. For example, economists can assess this data to determine whether increases in government spending, or investment spending, is having an influence on consumer saving and spending.

But understanding MPS isn’t just for economists and policymakers. Here’s why it may matter to you:

•   It helps you analyze how you use extra income.

•   It shows if your current spending habits align with your savings goals.

•   It can help you adjust behavior to avoid lifestyle inflation.

If you receive a raise or a financial windfall (like a bonus, inheritance, or cash gift), recognizing your personal MPS can help you make more strategic decisions, rather than impulsively spending the entire amount.

How to Start Saving Money

Whether you’ve recently experienced a boost in income, expect a raise or bonus in the future, or simply want to amp up your savings rate, these strategies can help.

Identifying Your Savings Goals

Consider what you’re saving for in the near-, mid- and long-term. For example:

•   Short-term goals: These might include building an emergency fund or saving for a small vacation.

•   Medium-term goals: This could include buying a car, a home improvement project, or a wedding.

•   Long-term: These are goals that are many years, even decades, away, such as retirement, sending a child to college, or achieving financial independence.

Once you’ve set some goals and timelines, you’ll want to figure out how much you need to set aside each month to reach those goals. If your goal is short-term, you might consider keeping your funds in a high-yield savings account. Online banks and credit unions tend to offer the highest rates.

“For money you’ll use in three to seven years, you may be prepared to take slightly more risk than a savings account,” says Brian Walsh, CFP® and Head of Advice & Planning at SoFi. “You might choose to use a brokerage account where you can invest that money in stocks, bonds, cash, or other asset classes. Just be sure to keep your comfort with risk in mind.”

For retirement saving, you’ll want to utilize retirement accounts, such as an employer-sponsored 401(k) or an individual retirement account (IRA).

Recommended: Emergency Fund Calculator

Creating a Budget

To free up funds for saving, it’s important to make a basic budget. You can do this by gathering up the last several months of financial statements and using them to determine your average monthly income and average monthly spending.

If you find that your average monthly cash outflow is the same or close to your average monthly cash inflow (meaning you’re not saving much or anything each month), you’ll want to comb through your expenses and look for places where you can cut back. Any money you free up can be siphoned into savings.

Alternatively, you might look for ways to increase your income, such as asking for a raise, freelancing, or starting a side hustle, then funnel those extra earnings right into savings.

The Takeaway

The marginal propensity to save, or MPS, is more than just an economic formula — it’s a practical tool that can help you reflect on how you manage your money. Whether you’re building an emergency fund, saving for home, or hope to retire some day, consider increasing your savings rate any time you get a raise, bonus, or any other increase in income.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 3.60% APY on SoFi Checking and Savings.

FAQ

Can MPS be greater than 1?

No, the marginal propensity to save (MPS) cannot be greater than one. This is because MPS represents the proportion of an additional dollar of income that is saved, and it’s impossible to save more than the total amount of additional income received. MPS always ranges between 0 and 1.

How do you calculate the marginal propensity to save?

The marginal propensity to save (MPS) shows how much of an increase in income is saved rather than spent. You calculate it by dividing the change in savings by the change in income. The formula is: MPS = Change in Savings / Change in Income.

What is the difference between average and marginal propensity to save?

The average propensity to save (APS) is the proportion of total income that is saved. It’s calculated by dividing total savings by total income. The marginal propensity to save (MPS), on the other hand, indicates how much of an increase in income is saved. It’s calculated by dividing the change in savings by the change in disposable income.

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Photo credit: iStock/MarsBars
SoFi Checking and Savings is offered through SoFi Bank, N.A. Member FDIC. The SoFi® Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

Annual percentage yield (APY) is variable and subject to change at any time. Rates are current as of 11/12/25. There is no minimum balance requirement. Fees may reduce earnings. Additional rates and information can be found at https://www.sofi.com/legal/banking-rate-sheet

Eligible Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Eligible Direct Deposit”) via the Automated Clearing House (“ACH”) Network every 31 calendar days.

Although we do our best to recognize all Eligible Direct Deposits, a small number of employers, payroll providers, benefits providers, or government agencies do not designate payments as direct deposit. To ensure you're earning the APY for account holders with Eligible Direct Deposit, we encourage you to check your APY Details page the day after your Eligible Direct Deposit posts to your SoFi account. If your APY is not showing as the APY for account holders with Eligible Direct Deposit, contact us at 855-456-7634 with the details of your Eligible Direct Deposit. As long as SoFi Bank can validate those details, you will start earning the APY for account holders with Eligible Direct Deposit from the date you contact SoFi for the next 31 calendar days. You will also be eligible for the APY for account holders with Eligible Direct Deposit on future Eligible Direct Deposits, as long as SoFi Bank can validate them.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, Wise, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi Bank shall, in its sole discretion, assess each account holder's Eligible Direct Deposit activity to determine the applicability of rates and may request additional documentation for verification of eligibility.

See additional details at https://www.sofi.com/legal/banking-rate-sheet.
*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.

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.

We do not charge any account, service or maintenance fees for SoFi Checking and Savings. We do charge a transaction fee to process each outgoing wire transfer. SoFi does not charge a fee for incoming wire transfers, however the sending bank may charge a fee. Our fee policy is subject to change at any time. See the SoFi Bank Fee Sheet for details at sofi.com/legal/banking-fees/.
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Offloading your used items can do you good on a couple of fronts. You can declutter your home, help fight waste (since you’re not just throwing things out), and make some extra money all by selling your still-useful stuff.

Whether you are looking to sell unwanted items like clothing, shoes, bags, furniture, housewares, books, electronics, or anything else, you can probably find a platform to help you get the job done. Some ways to sell are online, others aren’t, but all can do their part to connect your items with buyers — and get some additional cash flowing your way.

Here’s a guide on where to sell stuff, with dozens of places that can help you turn your unwanted items into cash.

20 Places to Sell Stuff Online

If you have items you no longer want or need, and you’re looking to make some extra money, exploring online platforms to sell used items can be highly beneficial. Whether you’re decluttering regularly to keep your space tidy or need a financial boost, online resale apps and sites offer convenient ways to reach a wide audience. Many of these platforms are free to list but they may take a small percentage of your profits once you sell.

💡 Quick Tip: Tired of paying pointless bank fees? When you open a bank account online you often avoid excess charges.

1. Craigslist

One of the original online marketplaces, Craigslist is still around and remains a popular platform for local classifieds. You can list all sorts of things, from tools to toys to DVDs to antiques (and much more) for free.

2. Facebook Marketplace

Facebook Marketplace makes it easy to sell items in your local area. It’s free to create a listing that can be seen by anyone on and off Facebook. You can also choose to post your listings to any “Buy and Sell” Groups you’re a member of.

However, a word of caution: Facebook Marketplace and other similar platforms can be used for bank account scams. Read up on common ploys and proceed with caution when selling this way.

3. Amazon

While you may think that Amazon is where you can buy new things, there are also a lot of opportunities to list used items. The site typically charges $0.99 per sale. You can also sign up for a professional selling plan which costs $39.99 per month no matter how many items you sell. Amazon may also charge others fees, including referral fees.

4. eBay

The original selling platform, eBay can still be a good way to sell your stuff, especially if you want to reach buyers from around the world who are looking to save money. Or it can be a huge help if you’re looking to unload an unusual item (there is almost nothing you can’t potentially sell on eBay). But you may want to keep an eye out for selling fees, which may include a listing fee, a percentage of the sales prices, and possibly other fees.

5. OfferUp

Developed as a locally-driven platform, OfferUp can be another good bet for selling used things. It allows you to sell to someone local, or ship an item to a buyer who lives anywhere in the U.S. The platform doesn’t charge fees or take a commission from your in-person transactions, but fees may be charged for shipping, promoting your items, and listings that go beyond the free allotment for the month.

6. Poshmark

Primarily a site for selling used clothing, Poshmark also lets you list home decor, jewelry, and beauty products. For sales you make under $15, Poshmark takes a flat commission of $2.95. If you make a sale that’s worth $15 or more, it takes 20%.^[3]

7. Etsy

Etsy may be best known as a platform for artists to sell their handmade goods and launch a low-cost side hustle. But the site also allows you to list some used goods. However, you can only resell in the “Vintage” and “Craft Supplies” categories. There is a listing fee of 20 cents per item, and, when you sell an item, there’s a transaction fee of 6.5% of the price. You may also need to pay a fee to open your Etsy shop.^[4]

8. thredUP

An online consignment and thrift store, thredUP sells thousands of major brands. You can send your gently used clothing directly to the service. If they accept (and sell) your clothing, you can earn ThredUp credit, which you can convert into cash. If your item sells in its listing window, you’ll earn a percentage of the selling price. This can be anywhere from 3% to 80%, depending on the item’s sales price.

9. eBid

Like eBay, you can sell just about anything on eBid, either for auction or at a fixed price. eBid is organized into three tiers of selling, with different membership costs and selling fees. eBid may or may not wind up costing you less than other selling platforms, depending on how much you will sell and at what price.

10. Bookoo

Bookoo is an online platform that serves as a local community marketplace for buying and selling items. It essentially functions like an online yard sale, facilitating in-person transactions between neighbors, and does not charge any listing or transaction fees.

11. Vinted

If you have a lot of gently used clothes, shoes, and accessories to sell, you may want to check out Vinted, a peer-to-peer online marketplace that focuses on vintage and second-hand fashion. And, for sellers, it’s free. Buyers pay a “protection fee,” typically 5% of the purchase price plus 70 cents.

12. Vestiaire Collective

If you have luxury items you want to sell, you may want to try Vestiaire Collective, a resale website where you can buy and sell high-end clothing, handbags, and accessories. Listing your items is free; once you make a sale, a selling fee of 10% will be deducted from the final price of your sale.

13. TheRealReal

TheRealReal is a luxury consignment site where you can drop off or ship designer clothing, accessories, and jewelry, as well as fine art and upscale home decor. They sell your items for you in exchange for a percentage of the profit.

Recommended: Ways to Make Money Online

14. Rebag

If you have a designer bag that you no longer want, you might consider selling it on Rebag, a site that’s focused on buying, selling, and trading luxury handbags and other accessories. The site offers three ways of selling — consign, trade, and buyout, giving you control over how you sell, what you earn, and how quickly you’re paid.

15. Bag Borrow or Steal

Another site for selling luxury handbags is Bag Borrow or Steal. You can sell directly to the site (and get paid right away), or you can consign and receive 70% of the sales price after it’s sold.

16. PreOwned Wedding Dresses

If you aren’t sentimental about keeping your wedding dress, bridal party gown, or accessories, then you might list it on Nearly Newlywed (PreOwnedWeddingDresses.com), with a $25 listing fee and an 80% payout of the sale price when someone buys it.

17. BookScouter

If you’re looking to sell textbooks, you may want to check out BookScouter. The platform simplifies the process by searching sites that buy used textbooks, then displaying the prices from those sites, so you can compare and decide where to sell your books.

18. GoTextbooks

GoTextbooks also allows you to sell your college textbooks and hopefully recoup some of the money you spent on them. When you let the site (sellback.gotextbooks.com/) know about what you have for sale, they will give you an instant quote. You can then ship your books for free and receive your money.

19. Gazelle

You may be able to turn your old cell phone into some quick cash at Gazelle. The site will give you an instant quote. If you like the numbers, you can ship the phone to them for free, and get paid via Amazon Gift Card, PayPal, or check.

20. Instagram

If you have a fair number of followers on Instagram, you might consider listing items you’re looking to sell there. As with Facebook groups, you simply need to snap a photo, write a brief description, and name your price. Or, you can go the more professional route and integrate Instagram’s shopping tools.

15 Places to Sell Stuff In Person

For those who prefer face-to-face transactions, selling items in person can be equally rewarding. If you have items cluttering your home and you need quick cash, local stores, markets, and community sales can provide great opportunities to sell your goods directly. Whether you choose to consign your items or sell them outright for cash, these in-person places can offer immediate results and personal interactions with buyers.

1. Garage Sales

If your goal is to unload a large amount of stuff all at once, hosting a garage sale can be a good way to go. You could even get some neighbors together and hold a community garage sale to attract more people.

Just be sure to double-check local laws first to see if a permit is required.

2. Flea Markets

Community flea markets can be a great way to sell unwanted things. The owner and operator of the flea market will likely charge you a fee for a booth. If you live in a big city, you may have to register early to get a spot.

3. Buffalo Exchange

Buffalo Exchange is a vintage and used clothing store with locations throughout the U.S. If one of their stores is convenient to you, you can make an appointment to meet with a buyer. If they like your stuff, they will pay 25% of their selling price in cash or 50% in store credit. (Using that store credit could prove to be a good way to save money on clothes.)

4. Crossroads Trading

Crossroads Trading is a second-hand clothing store with brick-and-mortar locations throughout the U.S. If you visit a store, you may be able to receive cash for your clothing on the spot. For higher-end pieces, you can opt to consign. Crossroads also offers mail-in service.

5. Plato’s Closet

You can bring your gently used brand-name clothing and accessories to a Plato’s Closet near you. They’ll review your items and, if accepted, you’ll get paid on the spot.

6. Style Encore

A women’s resale store, you can bring in stylish, gently used clothes, shoes, handbags, and accessories to one of Style Encore’s retail locations. If the store likes your items, you will get paid right away in cash.

💡 Quick Tip: Did you know online banking can help you get paid sooner? Feel the magic of payday up to two days earlier when you set up direct deposit with SoFi.^

7. Once Upon a Child

If you have gently used children’s clothing and shoes, toys, and/or baby gear lying around, you may want to cart it over to Once Upon a Child, which has locations throughout the U.S. An employee will check out your goods and, if they think they sell them, will give you cash in return.

Recommended: Weird Ways to Make Money

8. Play It Again Sports

If you live near Play it Again Sports, you may want to consider bringing in all the no-longer-used sports equipment in your garage. You’ll clear out the space, and may get a nice amount of cash in return.

9. Music Go Round

Live in a musical household? Music Go Round is a resale music shop where you can bring in used instruments and sound equipment (like amps, MIDI equipment, and mixers) and get paid cash in return.

10. Local Thrift Stores

Unlike Goodwill or Salvation Army which accept donations, thrift stores — specifically ones that sell high-end or vintage clothing — might be willing to buy your clothes and other items. Look up local stores, and ask them what they buy and how much they typically pay.

11. Used Book Stores

Your local used book stores may be looking to purchase your books from you. You can call ahead, let them know what you have, and see if they are interested. You might wind up freeing up shelf space while making some extra cash.

12. Pawn Shop

You may be able to make some quick money selling your old stuff to a local pawn shop. Typically, pawn shops are only interested in things of real value, such as jewelry, collectible coins, and electronics. It can be a good idea to bring in proof of purchase so that the owner knows you aren’t trying to sell stolen goods.

13. Facebook Groups

If you’re in any local or niche Facebook groups, you may want to post items that might appeal to members of the group. You simply need to snap a picture, describe your item, set your asking price, and see what offers you get.

14. Nextdoor

Nextdoor is a network of local community websites and can be a good place to post items. To sell items locally for free, you’ll need to make an account. You can then create a post from your feed by clicking the “Sell or give away” option at the bottom.

15. A “Raid My Closet” Event

Do you have friends who might be interested in checking out what you have for sale? You may want to consider inviting them over for a “raid my closet” event, or a “raid my garage” party. You can offer food and drinks, and make it a fun celebration to declutter your home.

What Are the Benefits of Selling Your Things?

Selling your things can have several benefits:

•   You can declutter or downsize by selling unwanted items.

•   You can help the environment by passing the item along versus throwing it in the garbage.

•   You can help someone who is looking for a gently used item that you have and wants to get a good deal on it.

•   You can bring in extra income.

However, there are also some potential downsides of selling your stuff. As mentioned, there is the possibility of being scammed in some direct sales. There may also be tax implications if you frequently sell things for profit (meaning you’re getting more than you paid for the items). In that scenario, it’s a good idea to consult a tax professional.

The Takeaway

If you’re holding on to clothes, furniture, books, or other items you no longer want or need, you could be sitting on a way to make some extra money while decluttering.

What to do with all the extra cash that starts rolling in? You might want to bank it and earn a competitive return on those funds.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 3.60% APY on SoFi Checking and Savings.

FAQ

What is a good website to sell stuff on?

The right website to sell stuff on will depend on the item you are selling. If you are selling a piece of furniture or large appliance, you might try Craigslist or Facebook Marketplace. For clothing, you might consider a site like Poshmark, ThredUp or Vinted.

How do I sell my stuff online for free?

This will depend on the kind of item you are selling. Craigslist, Facebook Marketplace, and Vinted are some examples of platforms that typically don’t charge the seller any fees.

What is the best app for selling used items?

Among the apps to consider when selling your used items are eBay, OfferUp, and Poshmark. These can reach a large number of potential buyers, though as a seller, you will likely pay some fees.

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About the author

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Article Sources

1. Amazon. How to sell on Amazon: 7 steps for beginners.
2. OfferUp. What is OfferUp?.
3. Poshmark. What are the fees for selling on Poshmark?.
4. Etsy. Fees & Payments Policy.

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Photo credit: iStock/Zinkevych

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

Annual percentage yield (APY) is variable and subject to change at any time. Rates are current as of 11/12/25. There is no minimum balance requirement. Fees may reduce earnings. Additional rates and information can be found at https://www.sofi.com/legal/banking-rate-sheet

Eligible Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Eligible Direct Deposit”) via the Automated Clearing House (“ACH”) Network every 31 calendar days.

Although we do our best to recognize all Eligible Direct Deposits, a small number of employers, payroll providers, benefits providers, or government agencies do not designate payments as direct deposit. To ensure you're earning the APY for account holders with Eligible Direct Deposit, we encourage you to check your APY Details page the day after your Eligible Direct Deposit posts to your SoFi account. If your APY is not showing as the APY for account holders with Eligible Direct Deposit, contact us at 855-456-7634 with the details of your Eligible Direct Deposit. As long as SoFi Bank can validate those details, you will start earning the APY for account holders with Eligible Direct Deposit from the date you contact SoFi for the next 31 calendar days. You will also be eligible for the APY for account holders with Eligible Direct Deposit on future Eligible Direct Deposits, as long as SoFi Bank can validate them.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, Wise, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi Bank shall, in its sole discretion, assess each account holder's Eligible Direct Deposit activity to determine the applicability of rates and may request additional documentation for verification of eligibility.

See additional details at https://www.sofi.com/legal/banking-rate-sheet.
*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.

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.

We do not charge any account, service or maintenance fees for SoFi Checking and Savings. We do charge a transaction fee to process each outgoing wire transfer. SoFi does not charge a fee for incoming wire transfers, however the sending bank may charge a fee. Our fee policy is subject to change at any time. See the SoFi Bank Fee Sheet for details at sofi.com/legal/banking-fees/.
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.

^Early access to direct deposit funds is based on the timing in which we receive notice of impending payment from the Federal Reserve, which is typically up to two days before the scheduled payment date, but may vary.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

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You’ve likely made some impulse purchases in your life and later regretted spending your hard-earned cash that way. One way to avoid making impulsive or bad buying decisions is to hit pause just before you make a purchase to ask yourself a series of simple questions.

This extra step forces you to step back and honestly consider how the potential purchase fits into your life. You might ultimately decide you don’t want the item after all. And, if you do decide to buy it, you can feel confident that you’re doing it for the right reasons.

9 Questions To Ask Yourself Before Buying Something

Knowing some key questions to ask yourself before you buy something can help ensure that you spend according to your values and cut down on purchases you’ll regret later. After all, the last thing you want is to spend money on things that don’t really enhance your life — and may add to your debt (especially if you’re already paying off some debt).

Here are some key pre-purchase questions to consider.

1. Is This a Want or a Need?

A great first question to ask is whether your prospective purchase fulfills a need or is just something you want, or a discretionary expense. If it’s an item you need — and you can afford it — then you might just go ahead and buy it. If, on the other hand, it only fills a want, it’s a good idea to continue vetting the purchase with the questions that follow.

2. What Do You Gain From Buying This?

Consider what you hope to gain from making the purchase. Is it the admiration or approval from other people? Does someone you know or follow on social media have it? Is this something that will genuinely improve your quality of life?

Research suggests that people feel more satisfied when they spend money on things or experiences that mean something to them and reflect their values.

Recommended: What Is FOMO Spending?

3. Is This Something That Will Actually Sell Out?

Though retailers will often make you think you need to act quickly (due to low stock), there’s a good chance that the items that you’re thinking of buying will still be available at a later date. If you’re feeling pressured to buy due to a limited-time sale, keep in mind that sales pop up all the time. Waiting for the next one could save you even more money, as you may decide you don’t really want it that much. This can help you avoid making an impulse buy.

4. Can You Get It Used or for a Better Price

If you’re thinking of pulling the trigger on a full-price item you don’t need right away, consider whether you may be able to find a better deal. For example, you might:

Buy Used

If you’re looking at a piece of equipment (like sports, exercise, or baby gear) or furniture, keep in mind that you may be able to find it in great condition on a second-hand marketplace online or even a yard sale.

Find Discounts

While buying used is not everyone’s cup of tea, buying on sale should be. These days, there are websites and apps that can help you do quick price comparisons to find the best deals. Some apps will even alert you when the price for a wanted item drops.

5. Do You Own Something Similar?

If you were to look at what you already own, you might be surprised to find how often you purchase nearly the same items over and over again. Buying similar items is totally understandable. We all know what makes us comfortable and what we tend to wear or like, so we gravitate to similar-looking clothes, shoes, home decor, and so on.

If you already have several coffee mugs, jean jackets, baskets, whatever that are similar to your prospective purchase, you may want to pass.

Recommended: How to Stop Spending Money

6. Why Do You Want to Buy This Now?

Sometimes there is a clearcut reason to make a purchase, even an impulse purchase. You might be at a store and remember you need hand soap or a certain tool to make a repair. But if there isn’t a clear reason for making this purchase right now, you may want to pass.

7. How Often Will You Use It, Really?

If you will only use or wear the item you’re thinking about buying once, or even a handful of times, you may want to rethink the purchase. It’s possible you can get by with something you have, can rent the item, or can borrow it from a friend or neighbor. This can end up saving you buyer’s remorse as well as money that you could stash in a high-yield savings account.

8. If the Item Was Full Price, Would You Still Buy It?

A sale price can make an item look particularly appealing. You might even think you’d be a fool to pass it by. But it’s important to put the price tag to the side for a moment and consider whether or not you really want and love the item. Would you even be considering it if it were full price? If the answer is no, it’s likely you can forgo it.

9. Would It Be Better To Put the Money Elsewhere?

If you can ask yourself this question, then you’ve arrived. You’re thinking of the big picture and wondering whether there may be other things that are more important than what’s in front of you. This involves delaying gratification and knowing how to spend money wisely.

You might decide that rather than buying that new pair of shoes, the money could better be put in, say, an online bank account where it can earn interest with lower or no fees.

The Psychology Behind Reflecting Before Purchasing

One common reason why people shop for new (and often similar) things is because they don’t fully appreciate the things they already possess. But there is a way you can turn this psychology around.

Before you make a purchase, consider whether or not you already own something that can fulfill the same purpose. If you do, next think about whether there is a reason you need something similar. If you can’t, you can probably easily pass on the purchase. The process of reflection not only avoids an unneeded expense but allows you to refocus on the item you already have and appreciate it more.

How Budgeting Can Curb Compulsive Spending

Creating a budget involves looking at where your money is currently going and making sure that your spending aligns with your priorities. There are many different kinds of budgets but one simple framework is the 50/30/20 rule.

The idea is to divide your monthly take-home income into three categories, spending 50% on needs, 30% on wants, and 20% on savings (and debt payments beyond the minimum). This set-up helps curb compulsive spending because you only have so much “fun” money to spend each month. It also allows you to spend money without feeling guilty, since it’s baked into the budget.

Recommended: Savings Calculator

The Takeaway

If you are considering making a discretionary purchase, you can ask yourself a few questions that can help you avoid buying something that you later regret. For instance, asking if you already have something similar or whether you’d buy it even if it wasn’t on sale can help you determine your motivations. By reconsidering the purchase, you might wind up saving money that could be better spent paying down debt or going into your bank account.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 3.60% APY on SoFi Checking and Savings.

FAQ

How do you determine if you should buy something?

A good first step is to determine whether a prospective purchase fulfills a need or is simply something you want. If it fills a need, you can go ahead buy it, as long as you can afford it. If it’s a want, you might next consider why you want to buy it. Also think about whether you may already have something similar, and whether the money might be better spent on something else.

Should a budget include flexibility for impulse purchases?

Yes. A budget will typically allot a certain amount of money just for “fun” each month. This frees you up to make the occasional impulse purchase without feeling guilty or worrying that it will hurt your long-term financial health. In fact, building in flexibility to your spending plan can help you stick with it.

What questions should you ask yourself before buying something?

Some key questions to ask yourself before you make a purchase include:

•  Do I need it?

•  What do I gain from buying this?

•  Do I own something similar?

•  If the item was full price would I still buy it?

•  How often will I use it, really?

•  Could I get it used or for a better price elsewhere?

•  Is there a better way I could use this money?

How do you stop impulse buying psychology?

One effective strategy is to establish a waiting time before you make any discretionary purchases. If you see something you want to buy, put the purchase on pause for a week (or more). Tell yourself that if, at the end of the waiting period, you still want the item and can afford it, then you can go ahead and buy it. You may find, however, that by delaying gratification (and the purchase), you lose interest in the item and opt not to buy it after all.

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Photo credit: iStock/Talaj

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

Annual percentage yield (APY) is variable and subject to change at any time. Rates are current as of 11/12/25. There is no minimum balance requirement. Fees may reduce earnings. Additional rates and information can be found at https://www.sofi.com/legal/banking-rate-sheet

Eligible Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Eligible Direct Deposit”) via the Automated Clearing House (“ACH”) Network every 31 calendar days.

Although we do our best to recognize all Eligible Direct Deposits, a small number of employers, payroll providers, benefits providers, or government agencies do not designate payments as direct deposit. To ensure you're earning the APY for account holders with Eligible Direct Deposit, we encourage you to check your APY Details page the day after your Eligible Direct Deposit posts to your SoFi account. If your APY is not showing as the APY for account holders with Eligible Direct Deposit, contact us at 855-456-7634 with the details of your Eligible Direct Deposit. As long as SoFi Bank can validate those details, you will start earning the APY for account holders with Eligible Direct Deposit from the date you contact SoFi for the next 31 calendar days. You will also be eligible for the APY for account holders with Eligible Direct Deposit on future Eligible Direct Deposits, as long as SoFi Bank can validate them.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, Wise, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi Bank shall, in its sole discretion, assess each account holder's Eligible Direct Deposit activity to determine the applicability of rates and may request additional documentation for verification of eligibility.

See additional details at https://www.sofi.com/legal/banking-rate-sheet.
*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.

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

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