Your credit utilization is the percentage of your overall credit limit that you’re using, and it can have a major effect on your credit score. As your credit usage decreases, it can positively affect your score since it shows you’re responsible with credit. On the flipside, high credit utilization can ding your score as it suggests you’re overspending
If you’re wondering how to lower credit card utilization, there are some steps you can take to do so and help build your credit score.
What Is Credit Card Utilization?
Credit card utilization, or simply credit utilization, is how much of your credit limit you’re using on your revolving credit accounts. You can calculate this percentage by taking the total of your credit card balances and dividing it by your total credit limit.
For instance:
• Say you have two credit cards with limits of $3,000 and $5,000 respectively.
• You have a balance of $600 on the first card and $1,000 on the second card.
• By taking the total of your balances — $1,600 — and dividing it by your overall credit limit — $8,000 — and then multiplying by 100 to get a percentage, you’d end up with a credit utilization rate of 20%.
Why Does Your Credit Utilization Matter?
When it comes to your credit score, scoring models look at various factors, including your credit utilization on both individual accounts and overall. In other words, if your overall credit utilization is high, or one of your revolving accounts has a high balance, your score could be negatively affected.
Considering that credit utilization determines 30% of your FICO® score, which is the scoring model used by most lenders, it’s a major factor that affects your credit score.
What Is a Good Credit Card Utilization Rate?
As a credit card rule, you should aim to keep credit utilization under 30%. While this is the baseline, the lower your credit utilization is, the better. Many financial experts recommend keeping that figure closer to 10%.
A lower credit utilization rate demonstrates to lenders that you are responsible with your credit and don’t appear to rely on credit too heavily.
Tips for Lowering Your Credit Card Utilization
The good news is that you can raise your credit score relatively quickly just by lowering your credit utilization. Here’s how to lower credit utilization.
Paying Down Your Balance
Making payments before the due date arrives or the billing cycle ends could mean your balance goes down before your credit card issuer reports the amount to the credit bureaus. You could even make a payment right after your purchase goes through.
Having a lower credit card balance lowers your credit utilization, even if your credit limit remains the same.
Cutting Down on Spending
Budgeting carefully and reducing your spending could prevent you from racking up excessive credit card debt and getting stretched too thin financially.
However, that’s not to say you can’t use your credit card. Rather, limit your spending to what you can afford to pay off in full that billing cycle. Additionally, if you find your debt starting to balloon, consider pausing your credit card usage until you’ve gotten your balance under control so your credit utilization isn’t pushed higher.
Paying off Credit Card Balances With Personal Loans
If you’re carrying a balance on a credit card, one option to pay it off is taking out a personal loan. You could qualify for a lower interest rate, which can make the debt easier to get a handle on paying off. Plus, a personal loan is an installment loan, which means it won’t count toward your credit utilization.
However, you need to make sure you can still afford the payments and can qualify for competitive rates and terms. Some lenders may charge an application or origination fee — take this amount into consideration when deciding whether it’s worth going this route.
Requesting a Credit Limit Increase
Increasing your credit card limit can lower your credit utilization even if your outstanding balance remains the same. To get a credit limit increase, contact your credit card issuer to request one, either by calling the number listed on the back of your card or logging onto your online account.
Keep in mind that your credit card issuer may not approve your request. You may have to meet certain criteria to qualify, such as having a history of on-time payments and responsible credit usage.
Opening a New Credit Card
Opening a new credit card can increase your overall credit limit and therefore potentially lower your credit utilization. Keep in mind that you most likely won’t know what your credit limit will be until you’ve been approved for the card.
Plus, submitting an application generally triggers a hard credit inquiry, which could have an effect on your credit score.
Avoiding Closing Unused Cards
It might sound logical to close credit cards that you haven’t been using, but doing so could have negative consequences. More specifically, closing a credit card lowers your overall credit limit, which could increase your credit card utilization even if your credit card balance remains the same.
You could ask your spouse, family member, or close friend to add you on their credit card as an authorized user. If the primary cardholder maintains a low balance and has a high credit limit, it could lower your overall credit utilization.
Before going this route, however, speak with the primary cardholder to determine whether becoming an authorized user will help your credit score. You’ll also want to be clear on how you plan on using the card, or if you’d rather be a cardholder in name only.
Finding Out Whether Your Issuer Reports to Credit Bureaus
Most credit card issuers will report your payment activity and account balance every 30 days to the credit bureaus, though the reporting date might not coincide with your payment due date. If your card issuer reports your payment activity before you make a payment, it could look like you have a high balance, which could increase your credit utilization rate.
To remedy this, contact your card issuer to determine when it reports to the credit bureaus. Aim to pay off as much of your balance as you can before that, or request a new due date that’s ahead of when your issuer reports to the bureaus.
How Will Lowering Credit Utilization Affect Your Credit Score?
If you lower your credit utilization, you could build your credit score. Remember, your credit utilization is one of the major factors that affects your credit score. Aim to keep your credit utilization well below 30% — try using any of the methods mentioned above to do so — in order to help maintain your score.
The Takeaway
Credit utilization — the percentage of your overall credit limit you use — can have a major effect on your credit score. It’s best to keep your utilization as low as possible, but the benchmark generally recommended is that it should reach no higher than 30%. If your credit utilization rate has crept up, there are some tactics you can try to lower it, from paying down your balance to getting a new card.
Whether you're looking to build credit, apply for a new credit card, or save money with the cards you have, it's important to understand the options that are best for you. Learn more about credit cards by exploring this credit card guide.
FAQ
How can I fix high credit utilization?
You can decrease your credit utilization by paying off your balances early, asking for a credit limit increase, applying for a new credit card, and cutting down on spending.
How can I keep my credit utilization below 30%?
You can keep your credit utilization below 30% by watching your spending and balances across all your credit cards.
How low should I keep my credit utilization?
It’s best to keep your credit utilization below 30%. That being said, the lower your credit utilization rate, the better.
Does zero utilization hurt your credit score?
Zero utilization doesn’t hurt your credit score. However, 0% utilization doesn’t necessarily help your credit score either, as you can’t demonstrate on-time payments and other positive credit behavior.
Photo credit: iStock/Farknot_Architect
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.
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 .
At some point in your financial life, you’re likely to want to sign over a check to someone else instead of depositing it or cashing it. Maybe you received a check but don’t currently have a bank account so a friend will cash the check for you. Or perhaps you want to endorse a check you received and give it to your landlord as part of your rent payment.
To sign a check over to someone else isn’t hard, but you do need to follow the right protocol. In a few simple steps, the check can be ready for processing by the person you’re giving it to.
Here’s a quick guide on how to sign over checks to someone else, plus some points to consider before accepting a check that has been endorsed to you.
Key Points
• Signing over a check involves a few important steps to ensure it is valid and acceptable by the recipient’s bank.
• Verifying the check’s date is crucial, as banks typically only accept checks that are less than six months old.
• Endorsing the check requires writing your signature along with “Pay to the order of [Recipient’s name]” on the back of the check.
• Confirming the recipient’s bank policies regarding third-party checks is essential to avoid complications during the cashing or depositing process.
• Alternatives to signing over a check include using money transfer apps or opening a bank account if unable to cash the check directly.
5 Steps to Signing Over a Check
Generally, when someone writes you a check, you (the payee) are the only person who can cash it or deposit it into your bank account.
But can you sign a check over to someone else? Yes. These five steps detail how to sign a check over to someone else (you may hear a check that’s been signed over referred to as a “third-party check,” incidentally).
1. Make Sure the Check is Still Good
Before you begin the process of signing over a check, it’s a good idea to take a look at the date it was written by the payer, especially if the check has been lying around for a while.
How long are checks good for? Generally, checks are good for six months. After that, the bank may refuse to accept it.
If the bank does accept a check older than six months, the check could potentially bounce if the issuer no longer has the funds in their account.
2. Get the Okay From the Recipient
Before endorsing a check to a third party, whether that’s a person, a business, or a landlord, it can be wise to first reach out to that third party and confirm that they are open to accepting this form of payment.
When moving through the signing over process, it’s important that you and the recipient both agree to the transfer.
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3. Verify the Bank Will Allow the Signed Over Check
Banks often have different rules and requirements when it comes to accepting third-party checks.
To help ensure the process will go smoothly, it can be a good idea to call the recipient’s bank and ask about their policies before you endorse the check.
That way, you can avoid adding extra signatures and names to the back of the check (which can create confusion and delays if you later need to cash or deposit it somewhere else).
You may also want to find out what kind of identification the recipient will need to bring to the bank or if there is anything special they should do or know before bringing the check to the bank.
4. Endorse The Check Correctly
The next step in how to sign a check over is to endorse or sign it. Checks that typically come in your checkbook have an area on the back that reads “Endorse Check Here.”
On the line just below that, you will want to sign your name in pen, writing it just as it appears on the front of the check.
Underneath your signature, you’ll then want to write, “Pay to the order of [Recipient’s name].”
It’s a good idea to clearly write out the recipient’s name as it appears on their driver’s license or other photo identification they will use at the bank when depositing the check.
Check’s often say “do not write, stamp or sign below this line” beneath the endorsement area. You’ll want to try to avoid running into this area. If you do, the bank may refuse the check.
Once you’ve endorsed the check, you will have a “third party check” that you can give to the person you signed it over to so that they cash or deposit the check into their bank account.
While it may not be essential, you may also want to consider accompanying the recipient to their bank with your own photo identification to ensure it’s a seamless transaction and in case the bank teller has any questions.
If you decide you will be going to the bank together, you may want to hold off signing over the check until you get there. That way, you can endorse the check right in front of the teller after showing your ID.
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Can You Deposit Someone Else’s Check in Your Account?
Depending on your bank, you may or may not be able to deposit or cash a check that has been signed over to you.
As mentioned above, some banks might not want to accept an endorsed-to-you check because there’s a chance it could be a fraudulent check. Many check-cashing places won’t accept this form of a check either.
That’s why it’s a good idea to check with your bank before accepting a third-party check as a form of payment.
In addition, you may want to keep the following considerations in mind before accepting a signed-over check as opposed to one written directly to you.
• They can be less convenient. Unlike a regular check, you typically can’t deposit a third-party check at an ATM or upload it via your bank’s mobile deposit app. Getting the check cashed or deposited generally requires a trip to the bank.
• It could be a scam. There are lots of fake check scams out there (see below for more details).
• It could potentially bounce. Even if you know and trust the person who is signing the check over to you, there may still be a bit of risk involved. That’s because you can’t be certain the original person who wrote the check has the funds to cover it. If they don’t, it will be a case of the check bouncing, and you won’t get the money.
Alternatives to Signing a Check Over to Someone
Perhaps you discover that your bank won’t take a third-party check. Or what if the person you wanted to sign a check over to says “no thanks”? Now what? Try these options.
Use a Money Transfer App
If you wanted to sign a check over to someone because you are trying to pay them, you could instead deposit the check and use a money transfer app, such as PayPal, Venmo, or Cash App.
Open a Bank Account
If the reason you want to sign over a check is that you don’t have a place to deposit it, you could open a free checking account. Or, if you have had issues with your banking in the past (such as too many overdrafts or an account being closed by your bank), you might look into what is known as a second chance checking account. These can have some restrictions but allow you access and may eventually be transitioned to a standard checking account.
Try a Check-Cashing Business
If you have a received check but don’t have an account to deposit it into and need to get funds to someone, you could try a check-cashing business. While this can be a convenient option, the fees can be quite high.
Not all banks accept checks signed over to someone else. That is why it can be a smart move to check first before you try to go this route. You or the person to whom you signed over a check could wind up discovering that the check is not accepted for deposit once you arrive at the bank. Or it could be rejected if mobile or ATM deposit is used.
Also, if the bank does accept these checks and you are going the in-person route to deposit it, you may want to ask what sort of identification may be required. You may need some additional ID in order for the check to be cashed or deposited.
Watch Out for Check Cashing Scams
Third-party checks may be used as a ploy in fraudulent transactions, so be wary. You could become a victim of one if someone you don’t know offers to sign over a check to you (often for a large amount) as payment or in exchange for cash. For instance, if you were selling a used mobile phone for $400 and a person offers to sign over a check for $500 to you and tells you to keep the excess, that’s a major red flag.
That’s why it can be wise to only accept an endorsed check from a person you know and trust or verify the check before depositing.
Opening a Checking Account With SoFi
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.
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FAQ
How can you cash a check that is not in your name?
If you want to cash a check that is not in your name, you could have the person to whom the check is made out endorse the check to you. Then, make sure that your bank will accept it. Another option is to request a new check from the payor if it was mistakenly made out to the wrong name. Or contact your bank for guidance.
Can you mobile deposit a check signed over to you?
It is likely that you can mobile deposit a check that has been signed over to you, but it can be wise to double-check your financial institution’s policies to be sure.
Can someone deposit a check for you without your signature?
Generally, banks require a signature on the back to deposit a check. If someone is depositing a check for you, it will likely need to say “For deposit only” and have your signature to be accepted.
SoFi members with Eligible Direct Deposit activity can earn 3.80% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. 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 during a 30-day Evaluation Period (as defined below).
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 3.80% APY, we encourage you to check your APY Details page the day after your Eligible Direct Deposit arrives. If your APY is not showing as 3.80%, 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 3.80% APY from the date you contact SoFi for the rest of the current 30-day Evaluation Period. You will also be eligible for 3.80% APY 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, 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 members with Eligible Direct Deposit are eligible for other SoFi Plus benefits.
As an alternative to Direct Deposit, SoFi members with Qualifying Deposits can earn 3.80% 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 members with Qualifying Deposits are not eligible for other SoFi Plus benefits.
SoFi Bank shall, in its sole discretion, assess each account holder’s Eligible 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 an Eligible Direct Deposit or receipt of $5,000 in Qualifying Deposits to your account, you will begin earning 3.80% 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 Eligible 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 Eligible 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 Eligible 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 Eligible Direct Deposit or Qualifying Deposits until SoFi Bank recognizes Eligible Direct Deposit activity or receives $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Eligible Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Eligible Direct Deposit.
Separately, SoFi members who enroll in SoFi Plus by paying the SoFi Plus Subscription Fee every 30 days can also earn 3.80% APY on savings balances (including Vaults) and 0.50% APY on checking balances. For additional details, see the SoFi Plus Terms and Conditions at https://www.sofi.com/terms-of-use/#plus.
Members without either Eligible Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, or who do not enroll in SoFi Plus by paying the SoFi Plus Subscription Fee every 30 days, will earn 1.00% 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 1/24/25. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet. Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
“But it’s my money!” may be your thought upon withdrawing money from an ATM and discovering that you’ve been hit with a charge. Sometimes, even two charges: One from your bank (which may charge you a few dollars at out-of-network terminals) and one by the operator of the ATM (which can again add a few dollars).
Think about it: If you assessed two $3 fees when using an out-of-network machine to grab $40, you’ve paid $6 or 15% of the amount withdrawn just to get that cash into your pocket.
Fortunately, you can avoid ATM fees. Try these seven simple techniques.
Key Points
• Planning ahead for cash needs can help avoid unexpected ATM fees, especially when visiting cash-only businesses or establishments that offer cash discounts.
• Familiarizing oneself with bank ATM locations and identifying partner ATM networks can greatly reduce the chances of incurring out-of-network fees.
• Withdrawing more cash than needed in a single transaction can minimize the frequency of ATM visits and associated fees.
• Retailers often provide cash-back options when making purchases, allowing access to cash without incurring ATM fees at nearby stores.
• Choosing a bank with a large ATM network or one that refunds out-of-network fees can be a strategic move for those frequently withdrawing cash.
7 Ways to Avoid ATM Fees
Service charges are fairly common these days. You are probably used to getting hit with them when you order movie or concert tickets online, for instance. But if you are merely taking out your very own dollars from an ATM, you likely don’t want to pay for that privilege.
While it may not be possible to always avoid these fees, particularly if you travel frequently, there are some smart strategies for evading those charges. Follow this advice.
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Planning Ahead
Before heading out for the day or evening, consider whether or not you may need cash. Some independent restaurants, stores, and barber shops still operate as cash-only businesses. So if you’re testing out a new spot, you may want to check the website so you’re prepared with cash if needed.
If an establishment only accepts cash and you don’t have any, you may get stuck using the nearest ATM, which may result in double fees. It can also be a good idea to get some cash in advance (fee-free) if you’re going to a restaurant, gas station, or store that offers a discount for paying cash.
Choosing Restaurants That Take Credit Cards
A corollary to the above tip is to scope out a restaurant’s payment policies before you head out to dinner. It’s no secret that dining out can be a big expense (especially if you order that nice bottle of wine). Nor is it privileged information that many eateries are cash-only.
It’s wise to check the restaurant’s situation beforehand to make sure they take plastic. Otherwise, you will likely be forced to use the closest ATM, which can get pricey.
Taking Money Out Before Going Out
Another way to avoid ATM fees when dining out: Hit up the cash machine en route or earlier in the week. That way, you know you are covered.
Taking some time to familiarize yourself with your bank’s closest ATM locations (considering both home and work) can save you money and hassle down the line. There may be a location finder tool on the bank’s website or app, or you can do a general web search, or even use your phone’s maps app.
Generally, the larger, national banks will have more options for branded ATMs than smaller, regional institutions. Banks of all sizes, however, often partner with large ATM networks in order to expand their customers’ options and provide them with a fee-free banking experience.
3. Finding Partner ATMs
Another way to avoid out-of-network ATM fees is to find those terminals with which your bank has a relationship.
The biggest advantage of partnership networks is the potentially vast number of fee-free ATM locations available. Some of the largest networks even include ATMs in locations like convenience stores, pharmacies, and retailers.
If your bank partners with an ATM network, you may be able to perform ATM transactions at their terminals without getting hit with any fees from your bank, though some locations may still collect ATM surcharges. It can be wise to familiarize yourself with the policies before you start regularly hitting the machines for cash.
The easiest way to find your bank’s partners is to check the back of your debit card. If you see a logo for Allpoint, for example, you can search their app for the closest of their 55,000-plus locations.
This doesn’t automatically mean that your transaction will be entirely fee-free, but either your bank or the partner may waive charges. It’s a good idea to check with your bank for details.
Bank Partner ATMs Explained
What are bank partner ATMs? This means that there is a relationship between your bank and their partner and you can likely use their ATMs fee-free.
These kinds of partnerships can exist for various reasons. Perhaps you bank at a relatively small, local bank network. They may team up with a larger network of ATMs to make it more convenient for customers to get cash on the go.
Or perhaps you bank at an online bank, which doesn’t have brick-and-mortar locations but wants to provide access to cash machines. Their partner network can provide terminals fee-free, a nice perk for the bank’s clients.
Get up to $300 when you bank with SoFi.
No account or overdraft fees. No minimum balance.
Up to 3.80% APY on savings balances.
Up to 2-day-early paycheck.
Up to $3M of additional FDIC insurance.
4. Taking Out More Than You Need
How else to avoid ATM fees? Consider that ATM fees are typically per transaction, so one easy way to avoid extra charges is to withdraw more cash than you need. This is particularly true when traveling overseas, where surcharges can be significantly higher than domestic ATM fees. The downside is that you may feel uncomfortable keeping a bunch of cash on hand.
The Benefits of Less Frequent Withdrawals
Making less frequent withdrawals can have a few pros:
• Saves you time thanks to fewer visits to the ATM
• Costs you less in fees (if they are assessed)
• Can help with budgeting; taking one larger lump sum may focus you more on your spending vs. grabbing $20 here and there without realizing how much cash you are going through.
If you need cash and aren’t near one of your bank’s ATMs, you may be able to avoid paying an ATM fee by finding a nearby grocery store, gas station, or large retailer. Many of these retailers offer cash back when you make a purchase using your debit card.
If you go this route, you’ll need to make a purchase (ideally for something you need) and ask for cash back. The cashier will add the amount of cash you want to the purchase price and give it to use as cash, typically without charging any fee.
Where Can You Get Cash Back?
Many retailers allow you to ask for cash back, often with a stated maximum amount. You might be able to get cash when making a purchase at:
• Gas stations
• Grocery stores/supermarkets
• Large retailers, such as Target, Walmart, and Costco.
6. Choosing a Different Bank
Not all banks charge out-of-network ATM fees. If you’re getting hit with fees, especially double fees, you may want to consider switching to an institution that has a larger ATM network, doesn’t charge ATM fees, and/or refunds ATM fees charged by machine providers.
Some banks will reimburse up to a certain amount every month in fees charged by an out-of-network provider. If you suspect you’ll use non-network ATMs frequently, you may want to consider a bank that will refund you.
Some Banks Reimburse ATM Fees
The banking industry is changing, and several players now embrace the idea of reimbursing ATM fees. This puts the customer first. It also addresses the fact that online-only financial institutions are getting more popular; this means there are no bank-owned terminals because there are no brick-and-mortar locations.
7. Using Personal Payment Apps to Pay Your Friends
With peer-to-peer (P2P) payment apps like Venmo, you can often avoid a trip to the ATM entirely. Once you set up an account and link your bank account, it’s easy to move money directly from your account to your friends’ accounts. Your bank may also have its own P2P payment app.
Open a SoFi Checking and Savings Account
ATM fees can be annoying and add up quickly. But, fortunately, this is usually an avoidable expense.
One way to avoid ATM fees is to do some research on where your financial institution’s branded ATMs are located in your area, as well as ATMs that are in their partner networks. Other options include using payment apps or asking for cash back at a retail cash register when it’s available.
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 3.80% APY on SoFi Checking and Savings.
FAQ
How do you avoid paying fees at an ATM?
There are several ways to avoid paying ATM fees, For instance, you might only use in-network or partner bank ATMs, carry cash, and/or use credit cards or P2P payment apps.
Is it free to withdraw cash from ATMs?
It should be free to withdraw cash from an ATM provided you use your bank’s or its partner bank’s network. If you use an out-of-network terminal, however, you could pay a fee to both your bank and the machine’s operator.
Why do some ATMs charge you for withdrawing money?
You may be charged a fee if you use an out-of-network ATM. Because you are not a member of the bank providing the terminal, they can assess a charge to handle your transaction. In addition, free-standing ATM machines are a for-profit enterprise, offering the convenience of cash while earning a fee on every transaction.
SoFi members with Eligible Direct Deposit activity can earn 3.80% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. 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 during a 30-day Evaluation Period (as defined below).
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 3.80% APY, we encourage you to check your APY Details page the day after your Eligible Direct Deposit arrives. If your APY is not showing as 3.80%, 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 3.80% APY from the date you contact SoFi for the rest of the current 30-day Evaluation Period. You will also be eligible for 3.80% APY 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, 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 members with Eligible Direct Deposit are eligible for other SoFi Plus benefits.
As an alternative to Direct Deposit, SoFi members with Qualifying Deposits can earn 3.80% 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 members with Qualifying Deposits are not eligible for other SoFi Plus benefits.
SoFi Bank shall, in its sole discretion, assess each account holder’s Eligible 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 an Eligible Direct Deposit or receipt of $5,000 in Qualifying Deposits to your account, you will begin earning 3.80% 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 Eligible 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 Eligible 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 Eligible 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 Eligible Direct Deposit or Qualifying Deposits until SoFi Bank recognizes Eligible Direct Deposit activity or receives $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Eligible Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Eligible Direct Deposit.
Separately, SoFi members who enroll in SoFi Plus by paying the SoFi Plus Subscription Fee every 30 days can also earn 3.80% APY on savings balances (including Vaults) and 0.50% APY on checking balances. For additional details, see the SoFi Plus Terms and Conditions at https://www.sofi.com/terms-of-use/#plus.
Members without either Eligible Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, or who do not enroll in SoFi Plus by paying the SoFi Plus Subscription Fee every 30 days, will earn 1.00% 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 1/24/25. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet. Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
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.
ATMs can be a quick, easy solution when you need a fast cash infusion, but banks typically impose a limit on how much money you can withdraw in one day. If you are planning to withdraw a certain amount of cash, it can be wise to know whether you’ll actually be able to get the money you need from the nearest ATM. The typical amount is between $500 and $1,000.
Here, you’ll learn how much money you can likely withdraw from an ATM and how to get around these ATM maximum limits.
Key Points
• ATM withdrawal limits are set by banks to manage cash availability and enhance security for consumers against potential fraud.
• Daily withdrawal limits can vary widely, typically ranging from $300 to $5,000, depending on the bank and account type.
• Premium checking accounts often have higher ATM withdrawal limits compared to standard accounts, reflecting the banking history of the customer.
• To access more cash than the ATM limit allows, individuals can consider methods such as cash back at stores, withdrawals from savings accounts, or visiting a bank teller.
• Understanding specific bank policies and planning ahead can help individuals navigate ATM withdrawal limits more effectively.
What Is an ATM Withdrawal Limit?
An ATM withdrawal limit sets a maximum amount of cash you can withdraw per day from these machines. The limits vary widely, from several hundred to several thousand dollars. Often, those with premium checking accounts may have higher limits than those with standard accounts.
The kind of ATM you’re using (in-network or out-of-network) can make a difference, too, with in-network often having higher limits.
💡 Quick Tip: Don’t think too hard about your money. Automate your budgeting, saving, and spending with SoFi’s seamless and secure mobile banking app.
Why Do Banks Have ATM Withdrawal Limits?
While ATM withdrawal limits can be frustrating, they exist for two important reasons:
• Cash availability: Banks want to make sure there is enough money available for all ATM users. But ATMs can only hold so much cash, and banks only have so much cash on hand at any one given time. Say you go to an ATM on the Friday before a long holiday weekend to get some spending money and find that there is no cash left. This doesn’t happen often, but it’s a possibility. Capping the amount of money that can be withdrawn at an ATM helps ensure that customers can’t clean out ATMs or drain the bank’s cash reserves.
• Security: ATM withdrawal limits also protect consumers. If someone were to get hold of your debit card and PIN number, the ATM withdrawal maximum would prevent that fraudster from immediately draining your entire checking or savings account.
How Much Can I Withdraw From an ATM per Day?
The answer depends on the specific bank’s rules around withdrawals, with some capping at $300 and others going as high as $5,000 a day. A limit of somewhere between $500 and $1,000 is common.
In some cases, a withdrawal limit depends on a specific customer’s banking history or account type. A new customer with a basic checking account may have a lower withdrawal limit than an established customer with a premium checking account. If you have a student or a second chance account, your max ATM withdrawal might be lower than if you had a standard checking account.
Whether you are withdrawing from checking vs. savings can also make a difference. In some cases, how savings accounts work is to have a higher cap on how much you can withdraw at any one time. In others, you will find that you can pull more cash from an ATM using your checking account.
One thing to be aware of: You may be limited to how many withdrawal transactions you can make per month from your savings account. Check your financial institution’s policies for specifics.
You may also find that how much you can withdraw will depend on the type of ATM you are using. For example, you may be able to withdraw more from an in-network machine than an independent one at a gas station.
Here’s a chart showing the range of withdrawal limits for some popular banks:
Bank
Daily ATM Withdrawal Limit
Ally
$1,000
Bank of America
Varies; typically up to $1,500
Capital One
Varies; typically $200 to $5,000
Chase
Varies; typically $500 to $3,000
Citi
Typically $1,500
PNC
Varies; often $500 and up
Get up to $300 when you bank with SoFi.
No account or overdraft fees. No minimum balance.
Up to 3.80% APY on savings balances.
Up to 2-day-early paycheck.
Up to $3M of additional FDIC insurance.
How to Work Around ATM Withdrawal Limits
If you need more cash than an ATM will allow you to withdraw, there are a few workarounds that can help as you manage your money.
Ask for Cash Back While Shopping
In some stores (like grocery stores), it’s possible to ask for cash back at checkout when making a purchase. While cash back may count toward your debit card’s daily purchase limit, it typically doesn’t count toward a daily ATM withdrawal limit.
The store will likely also have a cash back limit that applies on a per-purchase basis. That could mean you’ll need to make multiple purchases to withdraw the full amount of cash needed.
Withdraw From Savings
If you have both a checking account and savings account, you can withdraw money from a savings account when using an ATM. This can help avoid the daily checking account withdrawal limit.
There may, however, still be some limitations on ATM savings withdrawals, and this may vary with the kind of savings account you have.
Withdraw at the Window
If you bank at a brick-and-mortar location and the branch is open when you need more money, head inside. You can withdraw the amount you need by seeing a teller.
Contact Your Bank to Increase Your Limit
You may be able to negotiate a higher ATM withdrawal limit simply by contacting your bank’s customer service department and asking for a boost.
Get access to higher APY, credit card cash back rewards, discounts, and more.
The Takeaway
ATM withdrawal limits are there for your protection as well as the bank’s, but that doesn’t mean they aren’t inconvenient at times.
If you regularly need cash, you may want to find out your bank’s daily ATM withdrawal limits and plan ahead. Or, you can work around the maximums in place and get cash from other sources. By using a bit of smart strategy, you can make sure you have the cash you need on hand.
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 3.80% APY on SoFi Checking and Savings.
FAQ
Can you withdraw $1,000 at an ATM?
The amount you can withdraw will vary based on a number of factors, including your account type (standard or premium) and the type of ATM you are using (in-network or out-of-network).
Which ATM lets you withdraw the most money?
You may find you can withdraw more cash at an in-network than out-of-network ATM.
What is the maximum amount I can withdraw from an ATM at one time?
The amount you can withdraw from an ATM may range from $300 to $5,000 a day, depending on the financial institution and your particular account. Somewhere between $500 and $1,000 is typical.
About the author
Jacqueline DeMarco
Jacqueline DeMarco is a freelance writer who specializes in financial topics. Her first job out of college was in the financial industry, and it was there she gained a passion for helping others understand tricky financial topics. Read full bio.
SoFi members with Eligible Direct Deposit activity can earn 3.80% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. 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 during a 30-day Evaluation Period (as defined below).
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 3.80% APY, we encourage you to check your APY Details page the day after your Eligible Direct Deposit arrives. If your APY is not showing as 3.80%, 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 3.80% APY from the date you contact SoFi for the rest of the current 30-day Evaluation Period. You will also be eligible for 3.80% APY 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, 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 members with Eligible Direct Deposit are eligible for other SoFi Plus benefits.
As an alternative to Direct Deposit, SoFi members with Qualifying Deposits can earn 3.80% 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 members with Qualifying Deposits are not eligible for other SoFi Plus benefits.
SoFi Bank shall, in its sole discretion, assess each account holder’s Eligible 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 an Eligible Direct Deposit or receipt of $5,000 in Qualifying Deposits to your account, you will begin earning 3.80% 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 Eligible 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 Eligible 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 Eligible 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 Eligible Direct Deposit or Qualifying Deposits until SoFi Bank recognizes Eligible Direct Deposit activity or receives $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Eligible Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Eligible Direct Deposit.
Separately, SoFi members who enroll in SoFi Plus by paying the SoFi Plus Subscription Fee every 30 days can also earn 3.80% APY on savings balances (including Vaults) and 0.50% APY on checking balances. For additional details, see the SoFi Plus Terms and Conditions at https://www.sofi.com/terms-of-use/#plus.
Members without either Eligible Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, or who do not enroll in SoFi Plus by paying the SoFi Plus Subscription Fee every 30 days, will earn 1.00% 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 1/24/25. There is no minimum balance requirement. Additional information can be found at http://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.
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.
After you’re approved for a new credit card, you usually have to wait for it to arrive in the mail before you can start using it. But with an instant-use credit card, as the name implies, you can start shopping immediately.
While not all credit card issuers offer this feature, some issuers share account information with cardholders as soon as they’re approved. Getting a credit card you can use instantly can come in handy if you’re eager to start racking up rewards or spending to secure a sign-up bonus.
What Is an Instant-Use Credit Card?
Instant-use is a feature that some credit cards offer, allowing account holders to use the credit card before they receive a physical card. This is a perk given how long it takes to get a credit card otherwise — usually, cardholders can expect to wait between seven and 10 business days for their card to arrive in the mail.
Each credit card issuer can have unique policies and requirements about using an instant-access credit card. For example, you may not have access to your full credit limit until your physical credit card arrives.
How Instant-Use Credit Cards Work
There are a few different ways that credit cards offering instant use may work. After applying and being approved, you may receive a credit card account number before you get the actual card, which allows you to use the account online. Or, the credit card issuer may provide a temporary instant credit card number or barcode that you can use to make purchases before the official card and number arrives. Note that this differs from virtual credit cards, where the credit card numbers you receive are always temporary and disposable.
In other cases, it’s possible to add the instant-use credit card you’re approved for to a digital wallet, such as PayPal, Google Pay, or Apple Pay. You could then use the card as you’d use other cards in your digital wallet.
Benefits of Instant-Use Credit Cards
The exact benefits of an instant-use credit card depend upon the specific policies of the issuer. Besides providing access to the credit card account more quickly, these cards can offer the following perks.
Faster Rewards Accrual
A key benefit of instant-use credit cards is how quickly you can use them. If a credit card for immediate use features a rewards program, you could start accrue these rewards more quickly, thanks to prompt access to your credit card account. Similarly, if your card offers a lucrative sign-up bonus, you can start spending to earn it that much sooner.
Discounts
Many brands offer discounts to those who get their instant-use credit card. For instance, some retailers may provide a 25% discount on the first purchase you make with the instant-use card. You could use that discount strategically on the largest purchase you’d planned to make in order to maximize this benefit.
Financing Offers
An instant credit card number may offer special financing offers, such as a promotional rate of 0% annual percentage rate (APR) for a designated amount of time. Taking advantage of such an offer can save you a significant amount of money if you pay off your full balance before the promotion ends. Otherwise, the regular interest rate will kick in.
When choosing a credit card, it can understandably seem tempting to get a credit card you can use today. Watch out, though, for the following drawbacks of instant-use credit cards.
Limited Availability
There aren’t that many instant-use credit cards available to choose from. Only a select number of issuers offer them, with some only offering instant access on certain cards. Further, even if you do apply for one of the instant-use credit cards offered, there’s the chance you won’t get immediate access if the issuer encounters any challenges confirming your information.
Initial Usage Restrictions
With some instant-use credit cards, you don’t get immediate access to your full credit limit until you activate your physical card. Instead, when you receive your instant credit card number, you’ll only be able to use a limited portion of your approved credit limit. Especially if you were planning to make a large purchase immediately, this could cap your spending power.
This can be a downside of any credit card. But with a credit card for immediate use, it can be tempting to run up the balance as soon as you have the account number in hand.
If you’re hoping to secure a credit card you can use immediately, here are some tips to keep in mind throughout the process.
Check Your Credit Score Before Applying
Before you move forward with applying — and incurring a dip in your credit score due to a hard inquiry — take a look at your credit score. See if it falls within an issuer’s credit card requirements. If it doesn’t, you might be better off applying for another card you’re more likely to get approved for. Or, you could take steps to improve your credit score before you submit an application, assuming you have the time to do so.
Don’t Skip Researching
If you’re in a rush to find a credit card for immediate use, you might feel tempted to jump on the first instant-use credit card you spot. But don’t let a sense of urgency cause you to skip out on doing due diligence. It’s still important to take the time to compare your options, and to review a credit card’s terms and conditions before you’d move forward with applying.
Remember to Read the Fine Print
When you’re in a rush to get a credit card you can use today, it can seem harmless enough to skip over reading the fine print. However, especially in the case of instant-use credit cards, this can contain some important information when it comes to understanding how credit cards work.
For instance, there may be restrictions on usage of your instant credit card number, such as limited access to your credit limit. If you’d planned to make a massive purchase immediately, you’ll want to know that sooner rather than later.
Tips for Using an Instant-Use Credit Card
If you get approved for a credit card for immediate use, it’s likely you’ll want to start using it as soon as possible. Here are some important tips to keep in mind as you start spending.
Know Your Options for Access
Issuers will provide approved applicants with usage instructions for their instant-access credit cards. The issuer may give you a credit card number that you can then use to make purchases online or using your mobile wallet. If the credit card is attached to a retailer, they may set it up so you can use their app right away with the credit card number they provide.
Don’t Forget to Active Your Physical Card When It Arrives
Even if you’re already off to the races when it comes to spending with your new credit card, don’t neglect your physical card when it does arrive in the mail. Unless you have your card in your digital wallet, an instant-use credit card number limits you to online or over-the-phone purchases. Plus, some issues only offer partial access to your credit limit until your physical card is activated.
Remember That Basic Credit Card Rules Still Apply
Same-day credit cards come with the same set of credit card rules as any other card. Before you get carried away with making purchases, make sure you’re not spending more than you can afford to pay off. You’ll also want to set up a reminder — or even better, auto-pay — to ensure you make timely payments on your new credit card.
What to Do If Your Card Doesn’t Offer Instant Access
If you thought you’d applied for an instant-access credit card only to discover it actually isn’t a credit card you can use instantly, you do have options.
• For one, you can call your credit card issuer and request rush delivery. Though this likely won’t be as speedy as instant access, it can expedite the mailing process. Just keep in mind that you may owe a fee to cover the cost of faster shipping.
• You might also explore a personal loan. Many online lenders offer same-day funding, and the interest rates for personal loans tend to be lower than those of credit cards. Just keep in mind that applying for multiple loans in a short amount of time can affect your credit score. That’s because each application results in a hard inquiry, which will temporarily lower your score.
• Lastly, this could be a good time to dip into your emergency fund — especially if you really need fast access to cash. If you do, just make sure to replenish your savings so you’re covered the next time an unexpected expense comes up.
The Takeaway
Applying for instant-use credit cards can come with benefits, including immediate buying power. There are some downsides to consider, though, before making the right credit card choice for your unique needs. For one, you’ll have a more limited selection of cards to choose from, as not all credit card issuers offer instant-use credit cards.
Whether you're looking to build credit, apply for a new credit card, or save money with the cards you have, it's important to understand the options that are best for you. Learn more about credit cards by exploring this credit card guide.
FAQ
Can you use a credit card the same day you get it?
With instant-use credit cards, you can use the card upon approval, which could happen almost instantly. For credit cards that don’t offer instant use, you can typically use the card as soon it arrives in the mail.
How long does it take for a credit card to arrive in the mail?
There are two factors that can impact how long it takes for a credit card to arrive. The first is how long approval takes, which can happen nearly instantly or take up to a week or so. You’ll then have to wait on mailing time, which can take anywhere from five business days up to two calendar weeks.
Can I use my credit card before it arrives?
There are credit cards that you can use instantly, although not all credit cards offer this capability. Some cards require you to wait for the physical card to arrive before you use it. If you have an instant-use credit card, you’ll receive instructions from the issuer on how to start using the account right away.
Photo credit: iStock/Cunaplus_M.Faba
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
