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If you have a bank account, you may be familiar with the monthly fees that many financial institutions charge their clients simply for having an account. These may be known as maintenance or service fees and tend to be assessed on checking accounts. However, some banks will charge them on savings accounts too.

These charges can add up over time. But it’s worth noting that some banks will lower them in certain situations, and others don’t collect them at all.

Since maintenance fees can eat away at your hard-earned cash, take a closer look here at how they work and how you might avoid them.

What Is a Monthly Maintenance Fee?

Banks often charge fees on personal and business checking accounts and sometimes even some types of savings accounts to help them offset operational costs or help to “maintain” your account.

Institutions may also charge these fees as a way to encourage customers to make larger deposits. Many banks will waive fees if customers keep their balances high or use their account more frequently, both of which benefit the bank. (Banks may also encourage activity by assessing inactivity fees if you let your account just sit.)

Monthly maintenance fees are usually automatically withdrawn from a customer’s account each month.

Why Do Banks Charge Monthly Service Fees?

Banks typically charge their clients monthly service fees to cover operational costs and make a profit. These fees help pay for services like maintaining accounts, processing transactions (such as mobile bank deposits), and covering the costs associated with setting up and keeping their infrastructure running.

How Much Are Typical Bank Maintenance Fees?

While not all banks charge a monthly maintenance fee, many of the large traditional financial institutions in the U.S. do charge monthly fees.

For Savings Accounts

Monthly maintenance fees on savings accounts can vary greatly. Typically, though, the average maintenance fee can range from $1 to $8 per month. Some banks may not charge any fee at all.

For Checking Accounts

How much a financial institution charges as an average maintenance fee per month for a checking account varies from one bank to another. One recent survey but the current average maintenance fee for a checking account at around $5.47 per month, while another found it to be $13.95.

While that may not seem like a lot of money when viewed as a one-time charge, it adds up to $65.64 to $167.40 per year. Add in other deductions, like for using an out-of-network ATM or triggering overdraft or NSF fees, and these surcharges can start to chip away at your hard-earned money.

Recommended: How to Cash Checks for Free

How Can You Get Monthly Maintenance Fees Waived?

Fortunately, there is often some wiggle room when it comes to maintenance fees. Here are some simple ways you may be able to minimize or even completely avoid this type of account fee.

Maintain a Minimum Balance

Many institutions will waive the monthly account fee if you keep a certain amount of money in your account, known as a minimum balance. That means If your average monthly balance dips below this amount, the maintenance fee would be triggered for that month and deducted from your account. If your average monthly balance is above this threshold, the bank would waive the fee for that month.

In some cases, linking your accounts (such as a checking and a savings account) can help you meet the balance requirement to avoid the monthly maintenance fee.

Set Up Qualifying Direct Deposits

Many checking accounts are free when you elect to have your paycheck or benefits check automatically deposited into your account.

Each bank may have slightly different qualifying criteria. Some banks waive the maintenance fee if you make a certain number of direct deposits to your account each month, while others might require you to deposit a minimum dollar amount.

Setting up direct deposit is usually a simple process. More than 95% of Americans are paid by direct deposit, according to National Payroll Week.

Recommended: Debit Cards With No Fees

Switch to a Bank With No Fees

Another option is to switch to a bank with no fees, which is often an online bank. Because online banks typically have lower overhead expenses than brick-and-mortar institutions, they can be less likely to charge their customers monthly fees. They often pay considerably higher interest rates as well and may have a network of fee-free ATMs for your convenience.

Credit unions can be worth checking out as well. As nonprofit, member-owned institutions, credit unions typically aren’t as focused on the bottom line as for-profit banks. This enables them to charge lower rates on credit products and levy fewer (and lower) account fees compared to banks.

The Takeaway

You don’t necessarily have to settle for paying high monthly checking account fees. Many financial institutions will waive monthly fees if you maintain a certain balance or sign up for direct deposit. Another way to avoid paying monthly fees is to consider a financial institution that doesn’t assess these fees, typically online banks and credit unions.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with eligible 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 3.30% APY on SoFi Checking and Savings with eligible direct deposit.

FAQ

What’s the difference between a monthly service fee and a maintenance fee?

Typically, a monthly service fee and a monthly maintenance fee are the same thing. Financial institutions may just use different terminology to describe them.

Can I ask my bank to refund a maintenance fee?

Yes, you can ask your bank to refund a maintenance fee. Contact customer service, explain why you feel you should be refunded the fee, and stay polite even if they don’t honor your request. Often, a bank will refund a fee to maintain a positive relationship with a customer. Or you might consider banking at a financial institution that doesn’t charge these fees, such as many online banks and credit unions.

Which banks do not charge a monthly fee?

Typically, online banks don’t charge a monthly maintenance or service fee. Since they don’t have brick-and-mortar branches, their operating costs can be lower, and they may pass the savings on to their clients. Credit unions, which are nonprofits, also may charge no or lower monthly fees.

Do all checking accounts have monthly fees?

No, not all checking accounts have monthly fees. For instance, many online banks and credit unions don’t charge fees to maintain a checking account. Also, some checking accounts with qualifying direct deposits or minimum balances don’t assess fees.

Is it better to have a minimum balance or pay a fee?

In terms of bank accounts, it’s typically considered better to find an account with no fees so you don’t have to worry about this issue at all. However, if you need to choose between keeping a minimum balance or paying a fee, it can be better to maintain a minimum balance vs. spending your hard-earned money on fees. If you are maintaining a minimum balance, look for an account that pays so interest, to keep your money working for you.

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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 12/23/25. 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.

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/.
^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.

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.

Third Party Trademarks: Certified Financial Planner Board of Standards Center for Financial Planning, Inc. owns and licenses the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®

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If you’re lucky enough to find yourself in possession of a bundle of cash that isn’t immediately needed to pay bills, you have some thinking to do. How to use that money? Whether it came your way via a work bonus, an inheritance, or an unexpected refund, you have the opportunity to put it to work for you in a variety of ways.

Instead of going on a shopping spree, you could deploy the funds to improve your financial situation and build wealth. Options include paying down debt, contributing to retirement goals, and beyond. Read on to learn the full story.

Before You Start: Make a Plan for Your Extra Cash

At some point, you may find some extra cash heading your way and wonder what to do with the spare money. Perhaps you get a bonus for wrangling a complicated project at work. Or you didn’t realize that you’d overpaid your taxes one year. Or maybe an inheritance comes your way.

When funds turn up that you weren’t expecting, it can be tempting to go shopping or book a last-minute vacation. But you might instead look at the money as a means to enrich your financial standing. (Or use most of it that way, and go shopping with a small amount of it.)

A windfall can be a once-in-a-blue-moon opportunity to pay off debt or plump up your emergency fund. It can help you boost your retirement savings or kick your savings for a future goal into high gear.

Yes, it takes discipline to put that money to work, but doing so can have a long-term positive impact on your finances and help with better money management.

Step 1: Build Your Financial Safety Net With an Emergency Fund

If your emergency fund is low (or nonexistent), you might use your new windfall of extra cash to build it up.

Having an emergency fund gives you a financial cushion, along with the sense of security that comes with knowing you can handle a financial set-back (such as a job loss, medical expenses, or costly car or home repair) without hardship.

Having this buffer can also help you avoid having to rely on credit cards for an unexpected expense and then falling into a negative spiral of high interest debt.

How Much to Save in an Emergency Fund

A general rule of thumb is to keep three to six months’ worth of monthly expenses in cash as an emergency fund. If, however, you are, say, the sole breadwinner in a family, you may want to aim higher. You might want to look at different scenarios using an emergency fund calculator.

Consider keeping your emergency fund in a separate high-yield savings account, such as a money market account, online saving account, or a checking and savings account. These options typically offer higher interest rates than a standard savings account, yet allow you to access the money when you need it.

id=”step-2-pay-down-high-interest-debt-like-credit-cards”>Step 2: Pay Down High-Interest Debt Like Credit Cards

If you carry any credit card or other high-interest debt, you might want to use your windfall to jumpstart a strategic debt payoff plan. While mortgage loans and car loans tend to offer lower interest rates since they’re secured by collateral, the same can’t be said of unsecured debts, such as credit card balances. Credit card debt can be especially hard to pay off, given that the current average interest rate is over 20%.

Strategies for Paying Down Debt

Here are two popular options for paying down debt:

•   The avalanche method involves ranking your debts by interest rate. You then put any extra money you have towards paying off the debt with the highest interest rate (while continuing to pay the minimum on other debts). After the balance with the highest interest rate has been completely paid off, you move on to the next highest interest-rate balance (again, putting as much money as you can toward it), and then move down the list until your debt is repaid.

•   With the snowball method, you focus on paying off your smallest debt first (while paying the minimum on your other debts). Once that balance is paid off, you take the funds you had previously allocated to your smallest debt and put them toward the next-smallest balance. This cycle repeats until all of your debt is repaid.

Using your extra cash to pay off debt has added benefits. You may build your credit score as your credit utilization ratio (the amount of available credit you’ve used vs. your credit limit) goes down.

In addition, once you clear your debt, you won’t have to budget for debt payments anymore, which is essentially getting extra cash all over again.

Step 3: Boost Your Retirement Savings

Here’s another idea for what to do with extra money. Rather than let it sit in your checking account, you might use it to grow your retirement accounts. There are a couple of options to consider here.

401(k) and Employer Match

Does your employer offer a 401(k) with matching contributions? If so, this can be a powerful tool to help you save for retirement.

Not only does a 401(k) help lower your taxes (since this money comes out of your salary before taxes are deducted), your employer’s matching contributions are essentially free money and can provide a nice boost to your retirement savings.

If you’re not currently taking full advantage of matching funds, you may want to adjust your contributions to help ensure you’re making the most of this benefit. And if a windfall comes your way, you may want to deposit it right into your account.

Start or Fund an IRA

What do you do if you don’t have a company plan or you’ve hit your contribution limit there? You might consider using your new influx of cash to open up (or add to) an individual retirement account (IRA).

While retirement may feel a long way off, starting early can be a smart idea, thanks to the magic of compound earnings (that’s when the money you invest earns interest/dividends, those earnings then get reinvested and also grow).

There is also a possible immediate financial benefit to investing in an IRA: Just as with a 401(k), your IRA contributions can possibly reduce your taxable income, which means that any money you put in this year can lower your tax bill for this year.

You’ll want to keep in mind, however, that the federal government places limitations on how much you can contribute each year to retirement funds.

Recommended: IRA vs. 401(k): What’s the Difference?

Step 4: Invest Beyond Retirement With a Brokerage Account

A little windfall can offer a nice opportunity to buy investments that can possibly help you create additional wealth over time.

For long-term financial goals (outside of retirement), you might consider opening up a brokerage account. This is an investment account that allows you to buy and sell investments like stocks, bonds, and funds like mutual funds and exchange-traded funds (ETFs).

A taxable brokerage account does not offer the same tax incentives as a 401(k) or an IRA but is much more flexible in terms of when the money can be accessed.

Though all investments come with some risk, generally the longer you keep your money invested, the better your odds of overcoming any down markets. Your investment gains can also grow exponentially over time as your earnings are compounded. Worth noting: Past performance doesn’t guarantee future return, and while your money may be insured against broker-dealer insolvency, it is not insured against loss.

While investing can seem intimidating, a financial planner can be a helpful resource to help you create an investment strategy that takes into consideration your goals and risk tolerance.

Step 5: Save for Major Life Goals

Still wondering what to do with extra money? If you already have a solid emergency fund and your retirement account is growing nicely, you may want to think about what large purchases you are hoping to make in the next few years. That could be buying a new car, or accruing a down payment for a home. A savings goal calculator can help you determine how much to save and for how long to reach your goal.

A lump sum of cash can be a great way to jumpstart saving for your goal or, if you’re already saving, to quickly beef up this fund.

Save for a Down Payment on a House

Owning one’s own home is a classic part of the American dream. To save for a down payment, you may want to open a dedicated high-yield savings account after researching which has the best interest rates and terms. Then, you could set up automatic transfers into it from your checking account after your paycheck is direct-deposited.

While saving a 20% or more down payment will help you avoid private mortgage insurance (PMI), that amount isn’t always possible. Some mortgages are available with 3% to 5% down, and first-time buyer assistance programs can provide extra help. Set a realistic timeline for saving; an online down payment calculator can help you do the math.

Save for a Child’s Education With a 529 Plan

If you have some extra money, you might consider putting it toward your child’s future education expenses. A 529 college savings plan is worth considering: It’s a tax-advantaged savings tool for education which allows earnings to grow tax-free. Withdrawals for qualified education expenses are also tax-free, offering a money-smart way to save for future schooling.

Step 6: Invest in Yourself Through Education or New Skills

Another option for extra money is to invest in yourself through education and new skills. This can turbocharge your career trajectory and earning potential. Depending on your particular interests, budget, and profession, you could go back to school for a degree, take an online course, attend workshops, or obtain certificates in different skill areas. Doing so can help you explore new horizons or deepen your competencies in an area you are already pursuing.

You can add money to a savings Vault account to earn interest as you research options and determine the best path forward.

The Takeaway

Wondering what to do with a lump sum of extra money is a good problem to have. Some options you might want to consider include: setting up an emergency fund, paying down high-interest debt, or putting the money into your retirement fund or another type of long-term investment.

If you are looking for a place to bank your funds for a future goal, compare account features, such as the annual percentage yield (APY) offered and fees assessed.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with eligible 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 3.30% APY on SoFi Checking and Savings with eligible direct deposit.

FAQ

Should I pay off debt or invest my extra money first?

When deciding whether to pay off debt or invest extra money, it’s usually wise to pay off high-interest debt such as credit cards) first. Then, if you only have low-interest debt (say, a mortgage), investing can be a good step because investment returns can be greater than the debt’s interest rate.

What should I do if I only have an extra $100 a month?

If you have an extra $100 a month, it can be a smart move to build an emergency fund, pay off high-interest debt (like credit cards), or invest in, say, a Roth IRA to build your wealth.

Where is the best place to keep my emergency fund?

Many people find that a high-yield checking account is a good place to keep their emergency fund. This keeps your money liquid, meaning you can access it when needed, while also earning some interest.

How much of my extra money should I enjoy versus save?

It’s important to strike a balance between enjoying your money and saving it. You might try the 50/30/20 budget rule, which allocates 50% of take-home pay to essentials, 30% to wants (things you enjoy), and 20% to savings and additional debt payments.

What is the difference between saving and investing?

Saving is setting money aside money securely and accessibly, often to achieve short-term goals. Investing involves using money for long-term growth in such assets as stocks and bonds but with a higher level of risk.

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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 12/23/25. 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.

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/.
^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.

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 .

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.

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.

Third Party Trademarks: Certified Financial Planner Board of Standards Center for Financial Planning, Inc. owns and licenses the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®

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Overdraft and non-sufficient funds (NSF) fees have a lot in common. Both fees are triggered when there’s not enough money in an account to cover a transaction, except with overdrafts, the transaction usually goes through, and with NSF, it’s canceled.

Both of these bank fees can be avoided with a bit of focus and practice. Read on to learn the details.

What Are Overdraft Fees and How Do They Work?

Here’s the meaning of an overdraft fee: When a bank account balance is negative (meaning transactions exceed deposits), the account holder is often charged an overdraft fee. The transaction goes through, but the account holder owes the bank the cost of the transaction to bring the account back to zero, as well as the overdraft fee set by the bank.

Typically, overdraft fees will continue with each transaction until an account’s balance is out of the red. That means if an account holder is unaware of the overdraft and goes on using the card without making a deposit, they could be hit with a fee for each charge, no matter how small.

Overdraft policies vary from bank to bank, but typically they kick in when a debit card or checking account transaction exceeds the amount held in a bank account.

When the transaction goes through, the bank has a few choices:

•   If the account holder has opted for a tool like overdraft protection, they may be shielded from overdraft fees up to a certain amount (bank policies vary as to how much).

•   If the account is typically in good standing, or if the account holder has never overdrafted before, the bank may choose to waive overdraft fees in this instance (or you might be able to request this and see if you can avoid overdraft fees).

•   If the account holder has a history of overdrafting, or their account is relatively new, the bank may choose to charge the overdraft fee.

When You Could Get Hit With an Overdraft Fee

It’s not just debit card purchases that can set off an overdraft fee. If the account holder doesn’t have enough cash in their checking account, any of the following transactions could lead to an overdraft fee:

•   ATM withdrawals

•   Checks

•   Autopay bill payments or withdrawals

•   Transfers between bank accounts

As mentioned above, once an account holder overdraws, the bank may continue to charge subsequent overdraft fees on the account until the account balance is restored through a deposit. It’s worth noting that not all banks will always assess a fee, however. If you are shopping for a new financial institution, you might look for a bank that doesn’t charge fees.

What Is the Average Cost of an Overdraft Fee?

The average overdraft fee is currently $26.77, but it can be as high as $35 or so, which can add up quickly when someone isn’t paying attention to their checking account balance. It’s worth noting that some consumer activists and lawmakers call for capping these fees at a lower figure, which would benefit consumers.

Recommended: Can a Cleared Check Be Reversed?

What Are Non-Sufficient Funds (NSF) Fees and How Do They Work?

On the surface, it’s hard to tell the difference between overdraft and NSF fees. Both fees occur when an account doesn’t have enough cash to cover a transaction.

However, here’s the meaning of an NSF fee: The account holder is charged when an account doesn’t have enough money to cover a transaction and the transaction is canceled or rejected.

An account holder might trigger what are known as NSF charges instead of an overdraft fee if they:

•   Opt out of or never signed up for overdraft protection

•   Already exceeded the bank or credit union’s overdraft protection limit

•   Write a check that’s more than the balance of the account

When You Could Get Hit With an NSF Fee

NSF fee policies vary by banking institution, but an account holder is more likely to be charged in the following situations:

•   Check writing. When someone writes a check for more than the account’s balance, the check bounces, and the transaction won’t go through. The account holder will be charged an NSF fee by their bank, and they may be charged an additional fee by the bank or entity that tried to cash the check.

•   ACH payments. An ACH payment, or Automated Clearing House Network payment, can be an easy way to transfer money or pay someone, but if the transferring bank doesn’t cover ACH payments, the transaction could be canceled and the NSF fee charged. Examples of ACH payments can include automated loan debits and mobile payment apps.

What Is the Average Cost of an NSF Fee?

The average NSF fee is currently $16.82, but some banks may charge considerably higher. It can be a wise move to familiarize yourself with your bank’s fee structure so you understand how much damage NSF fees could cause. You might also see if you can find a fee-free checking account.

Key Differences Between Overdraft and NSF Fees

NSF and overdraft fees are commonly lumped together as general bank fees, but they are not the same. Here’s the difference between overdraft and NSF fees:

NSF Fee vs. Overdraft Fee

	NSF Fee	Overdraft Fee
Average Fee	$16.82	$26.77
Transaction goes through?	No	Yes
Charged repeatedly until corrected?	Yes	Yes
Can it be avoided through overdraft protection?	Yes	Yes

5 Ways to Avoid Overdraft and NSF Fees for Good

Overdraft and NSF fees are frustrating for many people because they fall into the category of bank fees you should avoid — and you can easily do so with a few simple practices.

1. Setting Up Email and Text Alerts

Many banks and credit unions offer email and text bank alerts that account holders can set up to notify them of low balances. For example, an account holder could set up an alert when their checking account balance falls below a certain amount.

With enough notice, account holders have time to transfer money into the account to cover upcoming charges or auto-debits.

2. Utilizing Direct Deposit

Setting up direct deposit with an employer means paychecks go directly to a bank account on payday. It’s a nearly immediate payment, opposed to, say, waiting for a check by mail then depositing it at the bank. This could save someone from overdraft fees, especially if paychecks and major bills occur at regular intervals.

3. Linking to a Savings Account for Overdraft Protection

Linking your checking account to a high-yield savings account (or any savings account, for that matter) can be a good way to dodge overdraft and NSF fees. By connecting two accounts, you know that if you pay out more than is in your checking account, it won’t go into negative territory. Instead, funds will seamlessly be transferred from your savings account. Check the fine print with your bank to see if there are limits on how much can be covered in this way.

4. Checking Finances Regularly

While automation can help, nothing beats a regular check-in for managing your bank account. Consider reviewing account balances at least once a week. It can help you keep those numbers in mind when a large transaction or purchase comes up.

5. Utilizing a Budgeting App

Keeping a budget is an important part of financial wellness. Not only does it involve knowing the balance of bank accounts, but it can also prevent people from overspending or making unnecessary purchases that can send an account into overdraft. Some budgeting apps come with alerts to notify users when account balances are low. One good resource: Your financial institution. See what it offers.

Recommended: Is Overdraft Protection Worth It?

The Takeaway

Both overdraft and non-sufficient funds (NSF) fees occur when your bank balance drops below zero into negative territory. The key difference is that with overdraft fees, the transaction is typically completed, while with NSF fees, the transaction is usually rejected. You might look for a bank which doesn’t charge overdraft fees up to a limit to minimize the impact of these charges and take steps to always keep your account with a positive balance.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with eligible 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 3.30% APY on SoFi Checking and Savings with eligible direct deposit.

FAQ

Can a bank charge you both an overdraft fee and an NSF fee for the same transaction?

No, typically you will either pay an overdraft fee (if the payment was completed) or an NSF fee (if the payment was denied) for a transaction. You should not be assessed both fees for a single bank transaction.

Do all banks charge overdraft and NSF fees?

No, not all banks charge overdraft and NSF fees. It can be a good move to do an online search to see which financial institutions have reduced or eliminated these fees when choosing your banking partner.

What should you do if you’ve been charged an overdraft or NSF fee unfairly?

If you feel you have been unfairly charged an overdraft or NSF fee, contact your bank’s customer service department and politely request that the fee be waived, asking to speak with a supervisor if needed. If that isn’t successful, you might reach out to the Consumer Financial Protection Bureau (CFPB) or the Office of the Comptroller of the Currency (OCC) for assistance.

How does overdraft protection work?

Overdraft protection typically works by linking your checking account to another source of funding, such as a savings account or line of credit. This backup source can automatically transfer funds to cover transactions when your checking account isn’t sufficient. In this way, you avoid having checks bounce or purchases declined. There can be a fee for overdraft protection; check with your bank.

Can an NSF fee hurt your credit score?

NSF fees are not reported to the credit bureaus, so they do not directly affect your credit score. However, if they lead to carrying a debt that gets turned over to a collections agency, that could have a significant negative impact on your credit score.

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Photo credit: iStock/Ivan Pantic

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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.

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See additional details at https://www.sofi.com/legal/banking-rate-sheet.
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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/.
^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.

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 Trademarks: Certified Financial Planner Board of Standards Center for Financial Planning, Inc. owns and licenses the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®

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Selling things from around the house that you no longer need can be an easy way to make some extra money. If you have some valuable collectibles on hand, you might be able to turn them into more than just pocket change.

Some of the most valuable collectibles include vintage comic books, baseball cards, and toys. Taking a look through your attic, basement, garage, or closets might turn up some items that you could potentially sell for top dollar.

What Are the Most Valuable Types of Collectibles?

Some collectibles tend to be more valuable than others, and it’s helpful to know which ones might command the most (or least) money. As you’re sorting through your stuff, here are 10 of the highest-value collectibles to keep an eye out for.

1. Vintage Comic Books

Comic books are one of the most popular collectibles because of how much they can appreciate in value over time. Devoted comic book fans who want to grow their collections may be willing to drop hundreds or thousands of dollars on a single edition. Even if you’re not getting that much for old comics, you can still sell them to make a little money on the side.

What Makes Vintage Comic Books Valuable?

Rarity and condition usually determine how valuable a vintage comic book ends up being. First editions, limited runs, or editions that introduce a character for the first time are all examples of comic books that may sell for a lot of money. Comic books that are in mint or near-mint condition are usually priced higher, which makes sense as collectors may be willing to pay more for a book that has limited wear and tear.

What Is the Most Valuable Comic Book?

The most expensive private sale of a comic book on record involved an edition of Action Comics No. 1. The comic reportedly sold for $6 million in April 2024, making it the most valuable comic book in recent years.

2. Baseball Cards

Baseball cards are in-demand collectibles that you might be able to sell online, at sports memorabilia conventions, or at local hobby shops. Along with baseball cards, you might be able to sell other sports memorabilia, such as baseball bats, gloves, jerseys, pennants, miniature helmets, or figurines.

What Makes Baseball Cards Valuable?

How much are my baseball cards worth? The answer can depend on the age, rarity, and condition of the card. Of those factors, scarcity can have the biggest influence on what a baseball card will sell for. The fewer there are of a particular card, the more money you might be able to get for it if there are collectors actively seeking it out.

What Is the Most Valuable Baseball Card?

The most valuable baseball card of all time is a Mickey Mantle card. Specifically, it’s the 1952 Topps Mickey Mantle (#311) card, which sold for $12.6 million at auction in 2022.

3. Vintage Bakeware

You might not give much thought to your mother or grandmother’s collection of casserole dishes, but they could be worth a fortune, depending on which ones they have. Vintage CorningWare and Pyrex dishes in particular can have a decent resale value if you’re able to find buyers who are looking for missing pieces to add to their collections.

What Makes Vintage Bakeware Valuable?

The value of CorningWare and Pyrex pieces is usually tied to their age, condition, and rarity. The actual design can also make a difference, as some patterns are considered to be more desirable by collectors than others. Pieces that feature patterns with limited runs or that are several decades old may command higher prices than ones that are more widely available.

What Is the Most Valuable Vintage Bakeware?

One of the most noteworthy examples of high-value vintage bakeware is the Lucky in Love line from Pyrex. A single bowl featuring the hearts and shamrocks design that the line is known for sold on eBay in 2022 for a winning bid of $22,100.

Shopping for bakeware? A spending tracker app can help you figure out what you can and can’t afford.

4. Rare Coins

If you have a collection of old coins gathering dust, you might be sitting on a literal goldmine without realizing it. Coins are one of the most popular and most valuable collectibles, with many of the rarest editions fetching thousands at auction. While their face value may be relatively low, their collectible value can sometimes be astonishing.

What Makes Rare Coins Valuable?

The value of coins is typically tied to three things: age, rarity, and condition. The older and rarer a coin is, the more it’s going to be worth in most cases. Its condition plays a part, however, as two coins from the same period may not have the same value if one is in better condition than the other.

What Is the Most Valuable Rare Coin?

One of the most valuable coins in the world is the Saint-Gaudens Double Eagle, which was minted between 1907 and 1933. These coins are highly valued for their beauty and rarity — the 1933 Double Eagle coin is estimated to be worth up to $18.9 million.

5. Vintage Toys

Hanging onto old toys is something people may do if they hold sentimental value. But certain toys may have monetary value if they’re deemed to be collectibles. Examples of collectible toys can include dolls, action figures, and board games. Trendy and retro toys can also grow in value over time if collectors are giving them special attention.

What Makes Vintage Toys Valuable?

Whether a vintage toy is considered to be valuable or not can depend on things like its rarity, uniqueness, and age. A toy that was manufactured as a special or limited edition, for example, may become sought after by collectors if there are only a few of them to be had. Versions of toys that include manufacturing flaws that distinguish them from other versions may also prove valuable.

What Is the Most Valuable Vintage Toy?

Excluding a 2010 special edition Barbie, which technically doesn’t qualify as vintage, the most expensive toy sold at auction is a 1979 Boba Fett prototype. Featuring a firing rocket, the figure sold for $1.342 million in 2024.

6. Stamps

Collecting stamps is a popular hobby, and if you happen to inherit a collection from a parent or grandparent, you might be wondering what it’s worth. The answer could be anywhere from a few dollars per stamp to more than seven figures.

What Makes Stamps Valuable?

Stamps are assigned value based on a few things, starting with their rarity. For example, some of the most valuable stamps are ones that are the result of a misprinting. Their value is tied not only to the printing error but the fact that only a handful of them exist.

As with other collectibles, the condition of the stamp also matters. The more pristine a stamp is, the higher its value is likely to be.

What Is the Most Valuable Stamp?

One of the most valuable — and notable — stamps is the Inverted Jenny, issued in 1918. The stamp features an image of an upside-down Curtiss JN-4 biplane, and it’s believed that most of them have been destroyed or lost over the years. In 2023, a rare Inverted Jenny sold at auction for $2 million.

7. Vintage Magazines

Vintage editions of popular magazines could easily be worth a few hundred or a few thousand dollars, depending on which ones you have. At the lower end, old magazines might sell for $5 to $20 per copy, which isn’t bad if you’re hoping to clear out clutter in your home and make a few dollars while you’re at it.

What Makes Vintage Magazines Valuable?

The value of a vintage magazine usually hinges on its age, rarity, and condition. A magazine that’s in mint or near-mint condition, for example, is likely to be worth more than one that has a torn or wrinkled cover, or is missing some pages. Editions of a magazine that’s now out-of-print may also be worth more than editions of a publication that’s still in operation.

What Is the Most Valuable Vintage Magazine?

One of the most valuable vintage magazines might surprise you. In 2021, a rare first edition of The Shadow No. 1 sold to a bidder for $156,000, making it the most expensive pulp magazine ever sold.

8. Antique Furniture

Antique furniture tends to be valued for both its age and its craftsmanship. A bed frame that’s hand carved, for example, is typically viewed as being more valuable than one that’s mass produced in a factory. Some of the most valuable furniture is associated with a specific style, such as Chippendale or Rococo.

What Makes Antique Furniture Valuable?

There are several factors that can make antique furniture valuable, including its:

•   Age

•   Construction

•   Materials

•   Hardware

•   Finish

Furniture that’s associated with a particular designer or stylistic movement can also be collectible. Authentic Shaker furniture, for instance, can easily sell for several hundred or several thousand dollars per piece. A professional appraisal is usually the best way to tell whether a particular piece of furniture is valuable.

What Is the Most Valuable Antique Furniture?

If you’re going by auction prices, the most valuable piece of antique furniture sold in recent years is The Badminton Chest. The chest, constructed in Florence and once believed to have been owned by the third Duke of Beaufort, sold at a Christie’s auction in 2004 for $36.7 million.

9. Jewelry

Jewelry, and related items like watches, are valuable collectibles to have simply because of their staying power. When you buy jewelry that is well made and features a classic design, it stands a better chance of withstanding the test of time. Necklaces, bracelets, brooches, rings, earrings, and pendants all have the potential to be considered collectible.

What Makes Jewelry Valuable?

Jewelry’s value is based on several factors, including the materials used to create the piece, the maker or designer, and its age. The rarer the materials or the more renowned the designer, the more a piece might be worth. The same is true for jewelry that features diamonds or precious stones. The higher the stone’s grading and the larger it is, the more value it may hold.

What Is the Most Valuable Jewelry?

As anyone who has purchased an engagement ring knows, jewelry can be pricey. The most valuable jewelry pieces are the ones that are either exceptionally rare or have some type of historical importance. Some of the world’s most expensive jewels include the Hope Diamond, the Cullinan Diamond, and the Koh-i-Noor Diamond, all of which have associations with royalty, and all of which are estimated to have valuations surpassing $350 million.

10. Antique, Classic, and Vintage Cars

Antique, classic, and vintage cars and other vehicles can also prove to be highly valuable, as these items tend to see strong demand from serious collectors. How much is my car worth? That’s a question an appraiser would likely need to answer, though you might be able to do some preliminary research using online valuation tools for vintage, antique, and classic vehicles.

What Makes Old Cars Valuable?

Valuations for antique, classic, and vintage cars can depend on several factors, including the vehicle’s age, condition, and mileage. How much of the original parts remain can also be a factor for vehicles that have been rebuilt or restored.

What Is the Most Valuable Antique, Classic, or Vintage Car?

Based on recent auctions, the most expensive collectible car is a 1955 Mercedes-Benz 300 SLR Uhlenhaut Coupe. The vehicle sold for $142 million at a 2022 auction held at the Mercedes-Benz Museum in Stuttgart, Germany.

What Types of Collectibles Gain the Most Value?

Collectibles that gain the most value are typically ones that are rare and in demand. In addition to the examples mentioned above, other valuable collectibles can include:

•   Vintage golf clubs

•   Vintage children’s books

•   Vinyl records

•   Retro gaming sets

•   Artworks

•   Fine wines and liquors

•   Shoes

•   Handbags

•   Clothing

•   Perfumes

•   Old photographs

•   Vintage electronics

•   Antique firearms

•   Antique or vintage kitchen appliances

•   Vintage tools

•   Musical instruments

Keep in mind that there are distinctions between items that are antique, vintage, and retro. Something is usually considered to be antique if it’s 100 years old or older. For vintage items, the threshold is typically 40 years, while retro items are 20 years old. The time frames may be different for vehicle valuations, as collectors may assign an additional category of “classic.”

As a general rule, the older an item is the more valuable it tends to be.

Recommended: 39 Passive Income Ideas to Build Wealth

How to Sell Valuable Collectibles

Selling valuable collectibles begins with understanding what your items are worth. Getting them appraised by someone who’s knowledgeable about the type of item you have can give you an approximation of its fair market value. For example, if you have a collection of antique watches, then you might take them to a jewelry appraiser for a professional valuation.

Following an appraisal, you may want to take the additional step of getting your items certified as collectible. Having a certificate of authenticity or collectibility can prove to interested buyers that your item is the real deal.

When you’re ready to sell your items, you can research different outlets for doing so. Where you decide to sell can depend largely on what you have to sell. Some of the options for selling collectibles include:

•   eBay

•   Etsy (for vintage items)

•   Local antique buyers

•   Consignment stores

•   Craigslist

•   Facebook Marketplace

•   Local comic book stores (for vintage comic books and other pop culture collectibles)

•   Sports memorabilia dealers

•   Flea markets

•   Auction houses

Pawn shops are another option for selling collectibles if you need money in a pinch. Keep in mind, however, that you likely won’t get the full value of your item if you’re selling to a pawn shop.

Recommended: 27 Weird Ways to Make Money

What Might Be Considered a Collectible in the Future?

It’s difficult to say what may or may not become a collectible, as it can depend largely on trends and how value is assigned to different types of items. Collectibility can depend on several things, including:

•   An item’s novelty or rarity

•   Demand for that item

•   Whether the item has any special historical or social significance attached to it

Applying those tests can help to identify collectible items that have the best odds of growing in value. Examples of items that may be considered collectible in years to come include:

•   Funko Pops

•   Gaming consoles

•   First editions of books that are being published now

•   Trending toys

•   Autographed memorabilia, which may increase in value once the signer passes away

In general, the value of a collectible item largely rests on how many there are to collect and the condition of each one.

The Takeaway

If you’re looking for alternative types of investments to add to your portfolio, valuable collectibles are one option you might consider. It’s possible that you may have a treasure trove of collectibles that could be worth some serious cash sitting right under your nose at home. And while you’re looking for collectibles to sell, consider what else you can do to make the most of the money you already have.

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

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

FAQ

Are valuable collectibles considered a financial asset?

What is a financial asset? In simple terms, it’s something that has positive value; assets are things you own, like real estate, cars, or bank accounts. Since collectibles typically appreciate in value, they could be considered a type of financial asset.

How do I know if my old items are valuable?

Getting a professional appraisal is usually the best way to determine whether old items are valuable. An appraiser can look at the item to assess its age and condition and then use their knowledge and expertise to give you an estimation of its value.

What is the 100-year rule for antiques?

The 100-year rule for antiques assumes that in order for an item to be considered an antique, it must be 100 years old or older. Vintage items, meanwhile, typically earn that label if they’re at least 40 years old, while retro items are usually at least 20 years old.

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Photo credit: iStock/Kemal Yildirim

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

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

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Navigating the cost of law school can be daunting, but scholarships offer a valuable way to reduce financial burdens and make your legal education more affordable. Whether you’re a prospective law student or currently enrolled, understanding the variety of scholarships available can help you secure funding for your studies.

Keep reading to learn the types of law school scholarships available, tips for finding law school scholarships, and strategies for crafting compelling applications to increase your chances of success.

The Average Cost of Law School

The average annual cost of tuition at a public, out-of-state law school in 2025 was $45,208 per year ($30,540 per year for in-state students). For private law schools, the average tuition in 2025 was $53,034 per year. And, according to Education Data Initiative, the average total cost of law school is $217,480.

Because students aren’t yet racking up those billable attorney hours, it can be helpful to research law school scholarship opportunities before applying to reduce the financial burden of law school.

Additional Costs Beyond Tuition (Books, Fees, Living Expenses)

As stated above, the average cost of law school is $217,480. This includes tuition, books, fees, and living expenses. Living expenses, including housing, transportation, and health insurance, will vary by location but often represent a large portion of a student’s total budget. Other expenses include:

•   Books: $1,000-$2,250 per year

•   Fees: $1,639-$1,790 per year

Together, these additional costs can make law school far more expensive than tuition alone suggests, so thorough financial planning is essential.

Recommended: Paying for College Without Financial Aid

Types of Law School Scholarships

Per the numbers mentioned above, there might be a fair amount of sticker shock for those who haven’t yet applied for graduate school and are only thinking of someday going the lawyer route. Fortunately, there are a range of options for aspiring attorneys seeking to fund law school.

Full-Ride Tuition Law School Scholarships

Some colleges may offer full-ride tuition scholarships and need-based grants for college. Full-rides, of course, are not available at all law schools. If a law school doesn’t explicitly advertise or highlight information regarding full-ride opportunities, interested students can contact the school to ask.

Students deciding whether to apply to law school may want to familiarize themselves with the language universities adopt to explain these scholarships. In some cases, specific scholarships are designated for particular students. Full-ride law school scholarships can be highly competitive — with some schools offering as few as two to four per enrollment year. One potential tip for the search for scholarships is to target law schools with more tuition help.

General Law School Scholarships

There are many options for law school hopefuls to find potential scholarships. These scholarships are often awarded by the school based on academic merit, LSAT performance, leadership experience, or a demonstrated commitment to the field.

In addition to school-sponsored awards, numerous organizations, foundations, and legal associations offer general scholarships for law students. These external scholarships may emphasize academic achievement, professional potential, or community involvement and are often open to applicants from various backgrounds and career interests.

And finally, don’t overlook smaller or less-publicized awards, which may go as unclaimed scholarships. These opportunities can provide meaningful financial support, and dedicating time to research them can give you an advantage in reducing your overall law school costs.

Law School Scholarships from Law Firms

Some law firms offer scholarships to law school students. Applying is typically a straightforward process, with many firms requiring a short essay, transcripts, and sometimes references to be considered. One such law firm scholarship is offered by the Dominguez Firm, which offers $2,500 and $5,000 annually to selected student applicants.

On top of this, there’s the rising trend of law firms helping new hires to repay a portion of their student debt once onboarded.

Diversity Law School Scholarships

Some scholarships are awarded to students with diverse backgrounds. One example of this is the Legal Opportunity Scholarship Fund offered by the American Bar Association. This $15,000 scholarship is awarded to law students from a racial or ethnically diverse background.

The USLaw Network Foundation also offers a $5,000 scholarship for up to 10 diverse students.

Law School Scholarships for Women

Some scholarships are offered to women attending law school. One resource is the American Association of University Women (AAUW) Fellowships and Grants, which offers scholarships to women in graduate studies, including law.

A specific scholarship for women is the Pearce Law Firm Empowering Women in Law Scholarship. This is a $1,500 scholarship awarded to female law students (or those accepted into J.D. programs) across the U.S. Recipients must submit a 700–1,000‑word essay explaining why more women should pursue law, their motivation to become a lawyer, and how they plan to make an impact.

Need-Based Law School Scholarships

Need-based law school scholarships are awarded to students whose financial circumstances make paying for law school particularly challenging. These scholarships consider factors such as family income, assets, employment history, and overall financial need rather than academic metrics alone. Many law schools use detailed financial aid applications to determine eligibility, while some external organizations also offer need-based awards to help reduce reliance on student loans.

Public Interest Law Scholarships

Public interest law scholarships support students committed to careers serving the public good, such as working in legal aid, nonprofit organizations, government agencies, or advocacy groups. These scholarships often emphasize a dedication to social justice and community impact, helping ease the financial burden of law school for those pursuing lower-paid but mission-driven legal roles.

One example is the Furman Public Policy Scholarship at NYU, which is a full-ride scholarship offered to someone with a commitment to public interest law.

Recommended: What Is a Graduate Fellowship? Tips for Applying

Finding Scholarships for Law School

Finding scholarships for law school starts with knowing where to look and which resources offer the most value. A strategic approach can help you uncover a mix of school-based, local, and national opportunities.

University Financial Aid Offices and Online Scholarship Databases

University financial aid offices and online scholarship databases are essential starting points for finding law school funding. Financial aid offices can guide you toward school-specific awards, FAFSA-related aid, and institutional grants, while reputable databases like LSAC, Fastweb, and AccessLex compile hundreds of external scholarships, making it easier to search by eligibility, interests, and financial need.

Local Bar Associations and Legal Organizations

Local bar associations, community foundations, and legal organizations frequently offer scholarships aimed at supporting aspiring attorneys within their region. These awards may prioritize students committed to public service, diversity in the legal field, or specific areas of law. Because they draw from smaller applicant pools, local scholarships can be more accessible.

Recommended: Applying to Graduate School: Smart Tips & Strategies

Negotiating Wiggle Room

Doing all this research and the math around law school scholarships could put applicants in a more informed position when evaluating which program to attend — and, potentially, help them to identify schools more likely to be interested in their application.

A reality of today’s admissions process for law school is negotiating scholarships. Some schools have a strict policy against negotiating, but others fully expect their initial offer to be countered. That’s why it can help to save acceptance letters and anything in writing from schools that offer admission.

Suggestions for Negotiating Law School Scholarship Offers

Offer letters could be shared with competing schools, asking if they’re able to match another university’s aid. It might be uncomfortable asking for more tuition assistance upfront, but a little discomfort now could help applicants shoulder less law school debt later on.

Doing research on law schools (and figuring out the likely cost of living expenses at each institution) could help applicants to determine which scores or grades to aim for in an effort to make law school more affordable for them. Tabulating expenses (and having records on hand) may also demonstrate to universities that the amounts being negotiated are based on well-documented expenses.

Timing Your Negotiation for Maximum Leverage

To maximize your chances of a successful negotiation, begin the conversation before the deposit deadline but early enough for financial aid offices to reassess your package. Reaching out during this window increases your chances of securing a higher scholarship while demonstrating professionalism and genuine interest in the school.

Recommended: Law School Loan Forgiveness and Repayment Options

Federal vs Private Loans for Law School

Students wanting to apply to law school should consider the differences between federal and private student loans. Federal loans come with certain benefits not guaranteed by private ones (such as forbearance or income-driven repayment), and should be used first before seeking private student loans.

Pros and Cons of Federal Student Loans for Law School

Federal student loans offer law students predictable interest rates, flexible repayment plans, and access to protections like income-driven repayment and Public Service Loan Forgiveness. While these benefits make them a reliable option, federal loans also come with borrowing limits, potentially higher interest rates than some private loans, and long-term costs that can add up over time.

Pros:

•   Fixed interest rates

•   Access to income-driven repayment plans

•   Eligibility for Public Service Loan Forgiveness

•   Deferment and forbearance options for financial hardship

Cons:

•   Potentially higher interest rates than qualified private loans

•   Borrowing limits may require supplemental financing

•   Interest accrues while in school for most loans

•   Longer repayment terms can increase total costs

When to Consider Private Student Loans

Private student loans may be worth considering when you’ve exhausted all federal financial aid options, including federal loans, grants, and work-study. They can help bridge funding gaps when federal loan limits fall short of covering the full cost of attendance, especially at higher-cost law programs.

Private lenders often offer competitive interest rates, which can make them appealing for students with strong credit or a creditworthy cosigner.

It’s important to note that private student loans don’t offer the same benefits and protections afforded to federal student loan borrowers, like Public Service Loan Forgiveness (PSLF). If a law school applicant is interested eventually in becoming a public defender or pursuing non-profit legal work, forgiveness and forbearance perks may play a role in their decision.

The Takeaway

Students looking to offset law school costs with scholarships can look to their law school, scholarship databases, local law firms, and other organizations for resources. Consider contacting the financial aid office at your law school if you are looking for scholarship resources. If students interested in law school find themselves coming up short on funds for the JD after scholarships and federal aid, additional options may be available.

If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.

Cover up to 100% of school-certified costs including tuition, books, supplies, room and board, and transportation with a private student loan from SoFi.

FAQ

What LSAT score will get me a scholarship?

One general rule of thumb is that students who have an LSAT score (and sometimes GPA) above the median for a certain school could qualify for a scholarship. Chances of qualifying are even greater if your score falls in the 75th percentile for the school.

What is a good scholarship for law school?

Any scholarship for law school is a good scholarship. Scholarships typically don’t need to be repaid and can help reduce a student’s debt burden. Students looking for law school scholarships can apply for institutional aid and aid through other sources like nonprofit organizations.

Do top law schools give scholarships?

While some top law schools do not offer scholarships, many law schools do offer law school scholarships to students. For example, in the 2024-2025 class at Yale, 67% of students qualified for some form of financial aid and 62% qualified for an institutional law school scholarship. Check directly with the schools you are interested in to see if they offer scholarships to students.

Can you negotiate a better law school scholarship offer?

Yes, you can often negotiate a better law school scholarship offer. Many schools allow applicants to present competing offers from other institutions to request additional funding. Success depends on factors like your LSAT score, GPA, and the school’s enrollment goals, but respectful, well-documented negotiations can lead to increased aid.

Are law school scholarships renewable each year?

Many law school scholarships are renewable each year, but they often come with conditions. Students typically must maintain a minimum GPA or class ranking to keep their award. Renewal policies vary by school, so it’s important to review requirements carefully to avoid losing funding after the first year.

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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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