How Much Does a UPS Driver Make a Year?

While the median annual salary for delivery drivers as of 2022 is $38,220, according to the Bureau of Labor Statistics, data from Zippia suggests that salaries in the $40K to $60K realm are possible. What’s more, UPS reports that the average overall compensation package for a full-time UPS delivery driver is $145,000, which reflects the benefits package that employees can receive.

For those who like working independently and being behind the wheel, a career as a UPS (United Parcel Service) driver could be a good fit. Keep reading for a breakdown of how much UPS drivers can earn and what this role entails.

Check your score with SoFi

Track your credit score for free. Sign up and get $10.*


What Are UPS Drivers?

UPS drivers pick up and deliver packages on a designated driving route for the UPS, a global package delivery and logistics company. They can have routes that include stops at residential and business addresses. You may well be familiar with the brown UPS trucks arriving and departing from your home or workplace.

Being a UPS driver can be a good option for introverted people since much of the day is spent solo, though there can be some social interaction when dropping off packages and getting signatures for them. Also, obviously, a UPS driver will need to be comfortable behind the wheel, in traffic, and ensuring that parcels get from point A to point B.

In terms of qualifications, you will likely need to be at least age 23, have a clean driving record, be trained to drive a truck, and be able to physically move packages of a certain weight (say, up to 70 pounds). If you have these qualifications, being a UPS driver can be a good-paying job without a college degree being required.


💡 Quick Tip: When you have questions about what you can and can’t afford, a spending tracker app can show you the answer. With no guilt trip or hourly fee.

How Much Do Starting UPS Drivers Make a Year?

If someone is new to working as a UPS driver, they shouldn’t expect to earn a top salary just yet. If you’re wondering how much a UPS delivery driver makes when they are entry-level, the lowest 10% of earners can expect to earn less than $26,740.

Recommended: Is $100K a Good Salary?

What Is the Average Salary for a UPS Driver?

You’re probably curious about how much a UPS driver can make annually, or on salary vs. hourly.

The answer to that question depends greatly on what state they work in. As the table illustrates below, the average hourly pay for UPS drivers can range from $19.56 to $30.05.

These figures are well above the national minimum wage.

What Is the Average UPS Driver Salary by State for 2023

State Average UPS Annual Salary Average UPS Hourly Pay
Washington $62,505 $30.05
Maryland $61,709 $29.67
Nebraska $60,422 $29.05
Virginia $59,629 $28.67
New York $59,560 $28.63
Delaware $57,768 $27.77
New Hampshire $57,620 $27.70
Oklahoma $56,158 $27.00
California $55,951 $26.90
Massachusetts $55,194 $26.54
Vermont $54,335 $26.12
Hawaii $90,774 $81,140
Wyoming $53,284 $25.62
Idaho $52,592 $25.28
Connecticut $51,960 $24.98
Maine $51,899 $24.95
West Virginia $51,761 $24.89
Rhode Island $51,216 $24.62
Texas $50,950 $24.50
Alaska $50,914 $24.48
Pennsylvania $50,885 $24.46
New Jersey $50,597 $24.33
Montana $50,538 $24.30
Nevada $50,513 $24.29
North Dakota $50,498 $24.28
Arizona $50,017 $24.05
Indiana $49,697 $23.89
Minnesota $49,294 $23.70
Tennessee $49,247 $23.68
Wisconsin $49,032 $23.57
South Dakota $49,023 $23.57
Ohio $48,890 $23.50
Oregon $48,264 $23.20
Utah $48,259 $23.20
Georgia $48,251 $23.20
Louisiana $47,806 $22.98
South Carolina $47,733 $22.95
Colorado $47,552 $22.86
Kansas $47,541 $22.86
Alabama $47,122 $22.65
Iowa $47,070 $22.63
New Mexico $46,586 $22.40
Florida $45,476 $21.86
Kentucky $45,448 $21.85
Arkansas $44,646 $21.46
Michigan $44,626 $21.45
Mississippi $44,537 $21.41
Illinois $44,403 $21.35
Missouri $43,694 $21.01
North Carolina $40,675 $19.56

Source: Zippia



đź’ˇ Quick Tip: Income, expenses, and life circumstances can change. Consider reviewing your budget a few times a year and making any adjustments if needed.

UPS Driver Job Considerations for Pay & Benefits

A job as a UPS driver can appeal to those who have not earned a college degree and those who enjoy driving. However, this can be a physically demanding job, considering you are behind the wheel and carrying packages all day, and it may be stressful to be in traffic or dealing with the pressures of getting packages to their destination. Many workers, however, will enjoy the independence. It can be a good job for antisocial people, too.

Along with receiving a salary, UPS drivers also gain access to valuable employee benefits. This table highlights the current benefits for UPS drivers.

Healthcare Paid Time Off Retirement
$0 premiums Up to seven weeks vacation, 18 holidays, sick leave, and option days Defined benefit pension plan

Pros and Cons of UPS Driver Salary

There aren’t any notable cons associated with the UPS driver salary. These roles are in high demand and often regarded as having competitive pay and great employee benefits. The real question may be whether the job suits a particular employee’s needs and if they enjoy the challenges of the job, such as driving all day.

Recommended: How Much House Can I Afford?

The Takeaway

The average full-time truck driver in the US makes $38,220 a year, but UPS workers seem to average in the $40k to $60k range. In addition to pay, UPS drivers gain access to valuable employee benefits like employer-sponsored healthcare, paid time off, and a pension plan. These benefits can help people balance their budget and enjoy quality of life, personally and financially.

FAQ

Can you make 100k a year as a UPS driver?

Yes, it may be possible to make $100,000 or more a year as a UPS driver, depending on where you work, how long you have been on the job, and what your specific role is. UPS drivers earn good salaries and on average, full-time drivers earn a compensation package of up to $145,000, according to UPS.

Do people like being a UPS driver?

Many people enjoy being a UPS driver due to the independent and consistent nature of the work. Those who would prefer to spend their days on their own versus working on a team could enjoy this role.

Is it hard to get hired as a UPS driver?

Because UPS drivers earn good salaries and have robust benefits packages, these can be competitive roles to land. That being said, UPS hires drivers all across the country so there are many job opportunities with this company.


Photo credit: iStock/sturti

SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.

*Terms and conditions apply. This offer is only available to new SoFi users without existing SoFi accounts. It is non-transferable. One offer per person. To receive the rewards points offer, you must successfully complete setting up Credit Score Monitoring. Rewards points may only be redeemed towards active SoFi accounts, such as your SoFi Checking or Savings account, subject to program terms that may be found here: SoFi Member Rewards Terms and Conditions. SoFi reserves the right to modify or discontinue this offer at any time without notice.

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.

Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

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.

SORL0124019

Read more
Average US Salary by State and Year

Average US Salary by State

The average salary in the U.S. is $63,795, according to the latest data from the Social Security Administration. How your salary compares will depend on your industry and skilI set, as you’d expect. What you might not realize is that your salary is also greatly influenced by where you live, since salaries go hand in hand with the cost of living.

Let’s take a closer look at the average salary in the U.S. and how income varies from state to state.

Key Points

•   The average salary in the US varies depending on factors like occupation, location, and experience.

•   As of 2021, the median household income in the US was around $67,500.

•   High-paying occupations include healthcare, technology, finance, and engineering.

•   The cost of living and regional differences can impact salary levels across the country.

•   It’s important to research salary ranges for specific occupations and locations when considering job opportunities.

What Is the Average US Salary (2024)

The national average salary is $63,795. That is the sum of all incomes divided by the number of workers. Where someone lives, their industry, education level, and current demand for that job all contribute to how much a worker earns per year.


đź’ˇ Quick Tip: Online tools make tracking your spending a breeze: You can easily set up budgets, then get instant updates on your progress, spot upcoming bills, analyze your spending habits, and more.

Average Salary vs Median Salary: What’s the Difference?

The Bureau of Labor Statistics (BLS) provides data on median pay. As of Q4 2023, the median weekly earnings of full-time workers was $1,145, or $59,384 per year. The median is the midpoint in the data set, with 50% of incomes falling above that figure, and 50% below.

Why are the average and median income figures different? With averages, unusually high or low numbers can skew the results. For instance, billionaires might drive the average higher than what the typical worker actually makes. The median is less affected by outliers.

US Average and Median Salary by State in 2024

The following chart shows both the average and median income (in single income households) in each state, according to data from Forbes and BLS.

State

Average

Median

Alabama $50,620 $57,564
Alaska $66,130 $66,820
Arizona $58,620 $65,780
Arkansas $48,570 $53,716
California $73,220 $84,448
Colorado $67,870 $74,152
Connecticut $69,310 $78,572
Delaware $62,260 $64,896
Florida $55,980 $64,168
Georgia $58,000 $64,844
Hawaii $61,420 $62,296
Idaho $51,350 $53,976
Illinois $63,930 $70,564
Indiana $53,500 $57,304
Iowa $53,520 $56,264
Kansas $52,850 $51,978
Kentucky $51,490 $57,200
Louisiana $50,940 $56,836
Maine $55,960 $58,396
Maryland $69,750 $72,904
Massachusetts $76,600 $86,840
Michigan $58,000 $63,440
Minnesota $63,640 $63,380
Mississippi $45,180 $48,048
Missouri $54,520 $59,800
Montana $52,200 $55,744
Nebraska $55,070 $56,784
Nevada $55,490 $61,828
New Hampshire $62,550 $72,124
New Jersey $70,890 $76,128
New Mexico $54,400 $57,564
New York $74,870 $84,292
North Carolina $56,220 $62,296
North Dakota $55,800 $61,568
Ohio $56,530 $60,320
Oklahoma $50,940 $54,704
Oregon $62,680 $66,612
Pennsylvania $58,470 $66,404
Rhode Island $64,530 $63,492
South Carolina $50,650 $56,108
South Dakota $49,890 $53,820
Tennessee $52,820 $62,140
Texas $57,300 $68,744
Utah $57,360 $61,516
Vermont $59,190 $61,100
Virginia $65,590 $71,292
Washington $72,350 $85,748
West Virginia $49,170 $55,900
Wisconsin $56,120 $58,552
Wyoming $54,440 $56,992

Recommended: Salary to Hourly Calculator

Why Do States Have Different Average Salaries?

The chart shows that the average salary in some states is quite different from the average salary nationwide. That’s partly because the cost of living, which affects how much a company pays its employees, varies significantly by state. (Also, inflation impacts states to varying degrees.)

In addition, industries with a concentrated presence in certain states — such as banking or automobile manufacturing — can affect the overall quality of job opportunities in that area.

Check your score with SoFi

Track your credit score for free. Sign up and get $10.*


Which Regions Pay the Most?

Salaries tend to be higher in some areas of the country. Cities on the West Coast and in the Northeast have some of the highest average salaries:

•   Massachusetts

•   New York

•   Washington

•   California

•   New Jersey

•   Connecticut

•   Maryland

Remember, while these states have higher incomes, they may also have a much higher cost of living and higher housing prices.

Recommended: 25 Highest-Paying Jobs in the US

Which Regions Pay the Least?

The South is home to states that tend to pay the least:

•   South Carolina

•   Kentucky

•   Louisiana

•   Alabama

•   Arkansas

•   West Virginia

•   Mississippi

To determine what your personal cost of living is, try tracking your expenses with a free budget app for a few months.

Should You Move to Make More Money?

It’s important to remember that just because a state has a higher average salary, that doesn’t mean it’s more profitable for workers to live there. Higher salaries tend to correlate with a higher cost of living.

Before making a major move, first try living below your means. One reason that people who make more money still have trouble paying their bills is the phenomenon of lifestyle creep. This is when your so-called needs expand to consume your current salary.

One of the most effective ways to counteract lifestyle creep is to downsize your home. Reducing your housing expenses to less than 30% of your gross income can help you pay down debt, increase savings, and become more conscious of how lifestyle choices affect spending.


đź’ˇ Quick Tip: Income, expenses, and life circumstances can change. Consider reviewing your budget a few times a year and making any adjustments if needed.

The Takeaway

The average annual average salary in the U.S. is $63,795. The median annual salary, which is often less skewed by outlying numbers, is $59,384. It’s worth noting that average and median salaries vary quite a bit by state. States in the Northeast and on the West Coast tend to pay higher salaries, while those in the South often pay less. What’s stopping people from moving to a higher paying state? Often, it’s housing prices, which rise along with the cost of living in “richer” states.

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.

With SoFi, you can keep tabs on how your money comes and goes.

FAQ

How much do the top 10% of Americans make per year?

The top 10% of Americans earn $173,176 per year. Some top earners live in higher cost of living areas, so it can be more revealing to see how much the top 10% earn in your state.

What percentage of Americans make over $75K?

Only 12.3% of Americans make in the $75,000 to $99,999 range. An additional 16.4% make between $100,000 and $149,000. However, a large portion of Americans (16.2%) earn in the $50,000 to $74,999 range.

Which U.S. state has the highest salary?

Massachusetts is the state with the highest annual income of $76,600. This salary is significantly more than the national average salary of $63,795.


Photo credit: iStock/artpipi

SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.

Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

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.

SORL0124016

Read more
22 High Paying Trade Vocational Jobs in 2023

22 High-Paying Trade Vocational Jobs in 2024

People tend to think of vocational jobs — which require special skills and training, but not necessarily a college degree — as paying less than careers that call for higher education. But there are plenty of vocational jobs, in a wide range of fields, that can provide a competitive paycheck. And those jobs can be both personally rewarding and vital to the economy.

If you aren’t sure college is in your future — because of the cost, the time commitment, or the desire to pursue a skilled job for which you have a passion — read on to learn more about which vocational jobs are among the highest paying.

Key Points

•   High-paying vocational jobs offer lucrative career opportunities without requiring a traditional four-year college degree.

•   Examples of high-paying vocational jobs include electricians, dental hygienists, aircraft mechanics, and radiologic technologists.

•   These jobs often require specialized training, certification, or an associate’s degree.

•   Vocational jobs can provide job security, competitive salaries, and opportunities for advancement.

•   Pursuing a vocational career path can be a viable option for individuals looking for well-paying jobs without a bachelor’s degree.

What Is a Vocational Job?

Vocational occupations generally require using specific skills that may be learned with hands-on training and/or classroom instruction — through an apprenticeship, for example, or at a vocational school or community college.

People may assume vocational jobs are mostly manual labor (think plumbers or machine operators), but that isn’t always the case. Many vocational jobs are done in an office setting, or in a hospital, airport, or school. And increasingly these jobs can require serious technical skills. So even though a vocational job won’t require a degree, workers may have to earn certain licenses or certifications to prove their proficiency, find employment, or advance in their career.


đź’ˇ Quick Tip: Online tools make tracking your spending a breeze: You can easily set up budgets, then get instant updates on your progress, spot upcoming bills, analyze your spending habits, and more.

Reasons for Applying for a Vocational Job

If you look up the word “vocation” in the dictionary, you’ll see that it’s sometimes used to describe a strong desire or “calling” to do a certain kind of work. And for workers in many vocational careers — bakers, hair stylists, carpenters, landscapers — the work they do is truly their passion.

But there are other reasons why workers might pursue a vocational job, including:

Eagerness to Enter the Workforce

Because a vocational job doesn’t require a four-year degree, workers can get a head start on life:

•   Get into the labor force faster.

•   Start earning a competitive salary or hourly wage.

•   Begin saving and investing money.

Recommended: What Is a Good Entry Level Salary?

Avoid Heavy Student Debt

Vocational school costs less than a four-year college, which can mean spending less upfront and graduating with no loans or lower student loan payments.

Follow in Someone’s Footsteps

If the family business is HVAC repair, a bakery, or salon, it might have been a goal since childhood to lean into that legacy.

A Less Traditional Path

Some extremely successful entrepreneurs, including tech executives like Bill Gates and Mark Zuckerberg, built their empires without earning a college degree. A college education can be a plus, but it isn’t a must for everyone.

Job Security

There likely will always be plumbers, auto mechanics, electricians, and cooks. And those aren’t the only vocational jobs that offer stability and competitive pay. Check out the U.S. Bureau of Labor Statistics’ current list of the “Fastest Growing Occupations,” which projects job growth to 2032. You’ll see wind turbine service technicians, occupational therapy assistants, solar panel installers, and several other vocational careers.

Recommended: The Highest-Paying Jobs in Every State

Pros and Cons of Pursuing a Vocational Job

Besides saving money and time on a four-year degree, there are other positives to pursuing a vocational career, including:

•   Unlike a career that requires a bachelor’s degree or higher, you probably won’t have to spend time studying material unrelated to the job you want.

•   Even while you’re in training, you’ll be making contacts that can help you in your career.

•   Many vocational jobs are stable and in high demand.

But there are some downsides to training for a vocational job:

•   If your education or training is too narrow in scope, you may have to go back to school if you decide to transition to a new job.

•   Your vocational program may not qualify for some types of federal financial aid.

•   Specialized careers often require continuing education to update skills and renew certifications.

Check your score with SoFi

Track your credit score for free. Sign up and get $10.*


Tips for Finding Vocational Jobs

If you think a vocational job might be right for you, here are some steps to consider as you get started:

Find a Mentor

Ask someone who is doing the job you’re interested in how they got started. They may be able to steer you toward a good training program, apprenticeship, or even a job.

Use Connections Made During Training

If you attend a vocational school, you likely will have access to networking events, career fairs, and job placement assistance. (Some programs offer lifetime placement assistance to their graduates.) Apprenticeships, certification courses, and even high school vocational programs may also offer opportunities to connect with potential employers.

Consider Enrolling in Job Corps

Job Corps is a free federal program that offers education, on-the-job training, and career assistance for young adults (ages 16 to 24). Career opportunities are available in a variety of fields, including automotive repair, manufacturing, construction, hospitality, renewable resources, health care, and homeland security.

Check Employment Sites and Job Boards

Many popular job boards include listings for apprenticeships and vocational jobs, as well as information on how to begin your job search.

22 High-Paying Trade Vocational Jobs in 2024

The money you can earn in any vocational job will vary depending on several factors:

•   Education and training

•   Certifications and credentials

•   Experience

•   Job difficulty

•   How much work you’re willing to put in

With that in mind, here are some high-paying vocational jobs to consider in 2024. (Average wages and job growth outlook are from Bureau of Labor Statistics data.)

1. Air Traffic Controller

Median Annual Salary: $132,250

Job Description: Coordinate the safe movement of various aircraft as they arrive and depart the airport.

Duties May Include: Using computers, radar, and visual references to direct air and ground traffic. Monitoring weather conditions. Alerting pilots to potential emergencies.

Entry Level Education Requirements: Associate degree plus training program

Job Outlook: 1% (little or no change)

Getting Started: Air traffic controllers typically earn an associate degree from an Air Traffic Collegiate Training Initiative (AT-CTI) program. Controllers also must meet several Federal Aviation Association (FAA) requirements, complete training at the FAA Academy, and obtain FAA certification.

2. Commercial Pilot

Median Annual Salary: $148,900

Job Description: Pilot a plane or other aircraft for a business, individual, or organization.

Duties May Include: Navigating and flying planes, helicopters, or other aircraft. Managing flight crew and interacting with ground crew. Assisting in maintenance and recordkeeping. Interacting with passengers.

Entry Level Education Requirements: Varies by employer

Job Outlook: 4% (as fast as average)

Getting Started
: To get a commercial pilot certificate, applicants must meet federal requirements for age and flight hours. They also must pass a physical exam, including a vision test. And they must earn the FAA-issued certificates and ratings required for their job. For more on commercial pilot requirements, see our guide to paying for flight school.

3. Nuclear Technician

Median Annual Salary: $100,420

Job Description: Assist physicists, engineers, and others doing nuclear research and nuclear energy production.

Duties May Include: Using computers and other equipment to monitor and help operate nuclear reactors.

Entry Level Education Requirements: Associate degree

Job Outlook: -1% (little or no change)

Getting Started: Many community colleges and technical institutes have associate degree programs in nuclear science, nuclear technology, or related fields. The amount of on-the-job training required to become a nuclear technician varies from one employer to the next and may be based on previous experience and education. Technicians often are expected to update their training throughout their career. Several certification programs are available.

4. Elevator and Escalator Mechanic

Median Annual Salary: $99,000

Job Description: Install and repair elevators, escalators, moving walkways, and related equipment.

Duties May Include: Testing, maintaining, and repairing electrical lines and control systems. Keeping inspection records.

Entry Level Education Requirements: High school diploma or equivalent

Job Outlook: 1% (little or no change)

Getting Started: This work, which is both technical and physical, requires participating in an apprenticeship program through a union, employer, or industry association. In many states, you must be licensed.

5. Radiation Therapist

Median Annual Salary: $89,530

Job Description: Use radiation equipment to treat cancer patients, typically in a hospital, doctor’s office, or outpatient center.

Duties May Include: Explaining treatment plans. Treating and monitoring patients. Updating records.

Entry Level Education Requirements: Associate degree

Job Outlook: 2% (as fast as average)

Getting Started: Accredited associate degree programs typically offer both classroom and hands-on training. Most states require some type of licensing or certification.

6. Dental Hygienist

Median Annual Salary: $81,400

Job Description: Provide screenings, treatment, and preventive care for oral diseases.

Duties May Include: Taking X-rays, cleaning teeth, advising patients about good oral hygiene, keeping records.

Entry Level Education Requirements: Associate degree

Job Outlook: 7% (faster than average)

Getting Started: Look for a dental hygiene degree program accredited by the Commission on Dental Accreditation, which should offer both classroom and clinical education. To become certified as a Licensed Dental Hygienist (LDH), you must also pass any state-required licensure exams.

7. MRI Technologist

Median Annual Salary: $67,180

Job Description: MRI technologists produce diagnostic images for patients at health-care facilities.

Duties May Include: Working with physicians and patients to get requested diagnostic images using an MRI scanner.

Entry Level Education Requirements: Associate degree

Job Outlook: 6% (about average)

Getting Started: Some states require MRI techs to complete an accredited training program before they can be licensed. Accredited MRI programs typically require applicants to have an associate degree for acceptance. If you’re heading to school with this job in mind, you may want to focus on anatomy, biology, and other health-related courses.

8. Aircraft and Avionics Equipment Mechanics and Technicians

Median Annual Salary: $70,740

Job Description: Mechanics and technicians work in hangars, repair stations, and at airfields, repairing and maintaining aircraft and equipment.

Duties May Include: Diagnosing problems, repairing malfunctioning systems, installing new equipment.

Entry Level Education Requirements: Varies by employer

Job Outlook: 4% (as fast as average)

Getting Started: Mechanics and technicians typically attend an FAA-approved aviation school, but some may gain their skills while in the military or on the job. You don’t have to have a degree, but you must be FAA-certified to work on aircraft.

9. Wholesale or Manufacturing Sales Representative

Median Annual Salary: $67,750

Job Description: Sell goods for wholesalers or manufacturers to a variety of businesses and other organizations, including government agencies.

Duties May Include: Working with clients in person and remotely to meet sales quotas and ensure quality customer service. Many sales representatives are given a specific geographical territory to cover.

Entry Level Education Requirements: Can vary depending on what’s being sold. Some products may require more technical knowledge than others

Job Outlook: 1% (little or no change)

Getting Started: Companies may offer a formal training program for sales employees that can include learning about all aspects of the product, from manufacturing to distribution. Certification and continuing education may be required.

10. Occupational Therapy Assistant

Median Annual Salary: $63,450

Job Description: Help patients work on skills needed for daily living and working.

Duties May Include: Working with therapists and patients to regain or improve basic life skills, such as getting up from a bed or chair, and walking. The job requires physical strength, patience, and good communication skills.

Entry Level Education Requirements: Associate degree

Job Outlook: 23% (much faster than average)

Getting Started: Occupational therapy assistants typically must obtain an associate degree from an accredited program that includes both academic study and field work. Most states require licensure.

11. Electrician

Median Annual Salary: $60,240

Job Description: Install, maintain, and repair electrical systems for businesses and homeowners.

Duties May Include: Problem solving when electrical systems aren’t working properly, reading blueprints, laying wire, and connecting fixtures.

Entry Level Education Requirements: High school diploma or equivalent

Job Outlook: 6% (average)

Getting Started: This job can require both physical and technical ability. Some electricians attend a vocational program and then move on to an apprenticeship. Others may learn their skills in the military, while many go straight to a lengthy (four to five years) apprenticeship. Most states require a license to do this type of work.

Recommended: Does Net Worth Include Home Equity?

12. Plumber

Median Annual Salary: $60,090

Job Description: Plumbers install, repair, and replace pipes and fixtures in homes and buildings.

Duties May Include: Knowing building codes and mastering everything from new builds to regular maintenance and emergency fixes.

Entry Level Education Requirements: High school diploma or equivalent

Job Outlook: 2% (as fast as average)

Getting Started: Plumbers typically learn their trade through an apprenticeship or vocational program. Most states have licensing requirements.

13. Civil Engineering Technologist / Technician

Median Annual Salary: $59,630

Job Description: Help plan, design, build, and maintain infrastructure projects, including roads, railroads, bridges, and dams.

Duties May Include: Working in an office and in the field, civil engineering technicians and technologists assist in collecting and analyzing project data, preparing reports, designing projects, and monitoring project progress.

Entry Level Education Requirements: Associate degree

Job Outlook: 1% (little or no change)

Getting Started: Many vocational schools offer classes in engineering, design, computer software, and other areas related to this career. Look for a program that’s been accredited by the Board for Engineering and Technology.

14. Paralegal or Legal Assistant

Median Annual Salary: $59,200

Job Description: Serve as support staff for attorneys.

Duties May Include: Researching cases, typing, communicating with attorneys and clients, organizing files.

Entry Level Education Requirements: Associate degree

Job Outlook: 4% (as fast as average)

Getting Started: You may want to start by earning an associate degree in paralegal studies from a program approved by the American Bar Association. Some employers may offer on-the-job training. Though it isn’t required, some paralegal organizations offer paralegal certifications to students who pass an exam.

15. Broadcast, Sound, and Video Technician

Median Annual Salary: $53,960

Job Description: Operate various types of equipment for media programs.

Duties May Include: Setting up and testing electrical equipment. Knowing industry codes and standards. Communicating with clients about their specific needs. Continuing education and certification may be required.

Entry Level Education Requirements: Requirements vary; some employers may require an associate or bachelor’s degree

Job Outlook: 2% (as fast as average)

Getting Started: Because this is a technical job utilizing equipment that is constantly changing, it can be useful to enroll in a targeted vocational or community college program. There also are voluntary certification / credentialing programs that can help with advancement.

16. Auto Service Technician or Mechanic

Median Annual Salary: $46,970

Job Description: Inspect, maintain, and repair cars, trucks, and other vehicles.

Duties May Include: Communicating with customers. Using diagnostic equipment and experience to monitor and troubleshoot a variety of problems. Repairing and replacing car components. Record keeping.

Entry Level Education Requirements: High school diploma or equivalent

Job Outlook: 2% (as fast as average)

Getting Started: Although it isn’t always required, many auto service technicians and mechanics complete a vocational or associate degree program that includes classroom instruction and hands-on practice. Certificate programs in specific automotive repair categories are also available. Many employers require service technicians to become certified by the National Institute for Automotive Service Excellence.

17. Medical Records Specialist

Median Annual Salary: $47,180

Job Description: Compile and maintain patient files for a doctor’s office, hospital, clinic, etc.

Duties May Include: Managing patient charts and records for billing and other purposes. Preparing billing statements. Requesting information from nurses, doctors, and other sources to keep files updated.

Entry Level Education Requirements: High school diploma or equivalent

Job Outlook: 8% (faster than average)

Getting Started: Employers may provide on-the-job training for entry-level positions, but advanced training and courses in medical terminology, electronic health records, and medical billing may be needed for more complex duties. Employers may expect candidates to complete one or more certifications.

18. HVAC Installer / Mechanic

Median Annual Salary: $51,390

Job Description: Install and repair heating and air-conditioning systems in homes and buildings.

Duties May Include: Assembling, installing, and fixing HVAC systems.

Entry Level Education Requirements: High school diploma or equivalent

Job Outlook: 6% (faster than average)

Getting Started: Many HVAC technicians receive instruction from a vocational school or a community college. Programs typically take six months to two years to complete and can lead to certification or an associate degree. Some techs learn their trade through an apprenticeship or years on the job. Some states require technicians to be licensed, and the Environmental Protection Agency requires all who buy, handle, or work with refrigerants to be certified in proper handling.

19. Tractor Trailer Driver

Median Annual Salary: $49,920

Job Description: Long-haul truck drivers transport goods across the country.

Duties May Include: Using GPS and maps to plan a safe and efficient delivery route. Ensuring the tractor trailer is well maintained. Driving routes that require spending several days away from home. Navigating busy highways, backroads, and crowded city streets.

Entry Level Education Requirements: High school diploma or equivalent, plus training course

Job Outlook: 4% (as fast as average)

Getting Started: Long-haul truck drivers must have a commercial driver’s license (CDL), which could require passing a knowledge test and a driving test. Professional driving instruction is required to be a long-haul driver, so you’ll have to sign up with a private truck-driving school or community college program. Drivers must maintain a clean driving record and pass a physical exam every two years. They also must submit to random drug and alcohol testing.

20. Carpenter

Median Annual Salary: $51,390

Job Description: Design, build, install, and repair structures made from wood and other materials.

Duties May Include: Carpenters might do anything from building kitchen cabinets to contributing to major infrastructure projects. They must be able read blueprints, understand building code requirements, and do hands-on construction work.

Entry Level Education Requirements: High school degree or equivalent

Job Outlook: 1% (little or no change)

Getting Started: Most carpenters learn through an apprenticeship or on-the-job from experienced tradespeople. They may start out in other construction jobs before moving into carpentry. All carpenters are required to pass a safety course administered by the Occupational Safety and Health Administration.

21. Licensed Practical Nurse

Median Annual Salary: $54,620

Job Description: LPNs provide basic medical care for patients under the supervision of physicians and registered nurses.

Duties May Include: Monitoring patient health. Providing medical care and comfort. Record-keeping.

Entry Level Education Requirements: High school diploma or equivalent, plus training program

Job Outlook: 5% (faster than average)

Getting Started: LPNs must finish a state-approved educational program that can take a year or longer to complete, and they must be licensed.

22. Solar Panel Installer

Median Annual Salary: $45,230

Job Description: Solar panel installers (also known as solar photovoltaic installers) assemble and install solar panels on homes and other structures.

Duties May Include: Setting up, troubleshooting, and maintaining solar panels. Connecting panels to the grid.

Entry Level Education Requirements: High school diploma or equivalent

Job Outlook: 22% (much faster than average)

Getting Started: Some solar panel installers attend courses at a community college or vocational school. Others learn through apprenticeships or on-the-job training. Licensing requirements vary by state.


đź’ˇ Quick Tip: Income, expenses, and life circumstances can change. Consider reviewing your budget a few times a year and making any adjustments if needed.

The Takeaway

Vocational jobs can offer a competitive paycheck and an opportunity to use your skills to do something you’re interested in — or even passionate about. Another plus: The upfront education costs and time commitment can be significantly less than for a four-year or advanced degree.

Choosing a career that’s fulfilling, secure, and pays well can be a significant step toward achieving the life you want. Of course, it’s also important to develop healthy financial habits, such as building a budget you can stick to, paying your bills on time, and monitoring your credit score.

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.

With SoFi, you can keep tabs on how your money comes and goes.

FAQ

What is the best trade to learn in 2024?

Some of the best-paying and in-demand vocational careers for 2024 are also among the most challenging and fulfilling. They include jobs in transportation, construction, and health care.

What is the highest-paying vocational job?

Air traffic controllers are among the highest paid workers with vocational jobs.

What is the easiest high-paying trade?

Many high-paying vocational jobs require high-level technical skills, good communication skills, and/or physical strength and endurance. What can make any job easier is if the person doing it is good at it and feels fulfilled. Many vocational jobs have the potential to check those boxes.


Photo credit: iStock/alvarez

SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.

Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

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.

SORL0124007

Read more
Can You Open a Savings Account for an Inmate?

Opening a Savings Account for an Inmate: All You Need to Know

You may wonder if it’s possible to open a bank account for someone who is in prison. The answer is, yes, it may be possible to start a bank account for a prisoner, provided it’s allowed by the Department of Corrections in the state where the individual is incarcerated. (Worth noting: It may also be a challenge to find a bank that offers this kind of account.)

Opening an account can be a positive step. Being imprisoned can limit someone’s ability to pay bills, grow savings, and generally manage their finances. Opening accounts for inmates at external banks can help them to earn interest on savings while saving money on fees. And it can potentially make their reentry into society easier upon release.

While inmates may have access to prison accounts, those can come with high fees, and they typically don’t pay interest. A prison account is a special type of account that allows an inmate to store funds which can be used to pay for hygiene items and other necessities while they’re incarcerated. It doesn’t impact their lives when released.

So, let’s take a closer look at this topic:

•   Whether it’s legal to open a bank account while in prison

•   How to apply for a bank account while in prison

•   What documentation is required to start an account

•   What kinds of accounts are available, including whether joint accounts are a possibility

Let’s start learning about accounts for inmates.

Is It Legal to Open a Bank Account While in Prison?

It’s legal to open a bank account while in prison, unless state law or correctional facility policy specifically prohibits it. The best way to find out whether opening accounts for inmates is allowed is to check with the Department of Corrections in the state where the person is incarcerated.

In Texas, for example, the Department of Criminal Justice encourages inmates to open accounts at an external bank of their choice. They can then link this bank account to their prison account. This can be used to replenish their account for items bought while in prison. Excess funds in their prison account can also be transferred to their external bank account.

The state of New York, on the other hand, prohibits inmates from opening outside bank accounts. Specifically, prisoners are not allowed to open:

•   Checking accounts

•   Savings accounts

•   Stock accounts

•   Mutual fund accounts

•   Money market accounts

•   Certificate of deposit (CD) accounts

•   “In trust for” accounts

Inmates in New York are also barred from receiving distributions from any U.S. savings bonds they might own. Prisoners who enter the system with existing checking accounts or other bank accounts are required to close them.

So, if you are thinking of opening a savings account for an inmate, whether or not you can will depend on where they’re imprisoned. If you’re able to open some kind of savings account for an inmate, the next challenge may be finding a bank that will allow you to do so. Let’s look at that issue in a bit more detail next.

Get up to $300 when you bank with SoFi.

No account or overdraft fees. No minimum balance.

Up to 4.20% APY on savings balances.

Up to 2-day-early paycheck.

Up to $2M of additional
FDIC insurance.


Why Banks Might Refuse to Help Prisoners

Not all banks are willing to open accounts for prisoners. Financial institutions can establish their own policies for when opening accounts for inmates is or isn’t allowed. If you’re trying to figure out how to open a bank account for an inmate and you’re hitting a brick wall with banks, it could be due to one of the following:

•   The bank requires a valid ID for the inmate, which you don’t have.

•   You have not been granted power of attorney (POA) for the inmate.

•   The inmate has a negative ChexSystems report (which is a reporting system for the banking industry) or previous issues with managing a bank account.

•   The bank is concerned that funds deposited to the account might be seized by a government entity.

•   The bank is concerned that the account may be used to conduct illegal activity.

It’s also possible that banks may be worried about running afoul of any rules or regulations established by their state’s Department of Corrections or Criminal Justice. In that scenario, it may be easier for the bank to simply not offer accounts for inmates to avoid any issues.

Applying for a Basic Bank Account for an Inmate

Let’s say that it is legal in the inmate’s state for them to hold a bank account, and you have found a financial institution that is willing to open an account. The next step would be to begin the account.

Keep in mind that opening accounts for inmates isn’t exactly the same as opening a checking account or savings account for yourself. In terms of how to open a savings account for an inmate, there may be one of three possibilities you can pursue. Again, the options you’re able to choose from could depend on what’s allowed by the inmate’s correctional facility and/or state.

Option 1: Specific Prison/Bank Arrangement

Correctional facilities may allow inmates to have outside bank accounts if they open them at an approved financial institution. For example, in Wisconsin inmates are allowed to open interest-bearing accounts at a bank that’s approved by the Department of Corrections.

If you’re trying to open a bank account for an inmate, you could check with the Department of Corrections or Criminal Justice to find out which banks are approved. The Department of Corrections should also be able to tell you what restrictions or requirements apply when opening accounts for inmates.

Recommended: How Much Money Do You Need to Open a Bank Account?

Option 2: Applying to Bank of Choice

While some correctional facilities require inmates to open external accounts at approved banks, others give you some leeway in deciding where to bank. As noted, Texas encourages prisoners to open accounts at the bank of their choice if they like.

If you’re trying to open a savings account for an inmate, the hard part may be finding a bank that will allow you to do so. You can start by checking at your current bank to see if it’s an option. If not, you can then try contacting other banks in the area to see which ones offer inmate accounts.

Recommended: How Many Bank Accounts Should You Have?

Option 3: Wait Until Release

Though not ideal, an inmate could simply wait until they’re released to open a savings account. This may be easier said than done, however, if the inmate isn’t able to meet the bank’s requirements for account opening.

What kind of requirements exactly? That could mean providing a valid ID and proof of address. And again, something like a negative ChexSystems report could lead the inmate to be denied a bank account. Unpaid balances or suspected fraud are other red flags that may result in an application for a new bank account being rejected.

Can Prisoners Be a Part of a Joint Bank Account?

You might be wondering how to open a joint bank account with an inmate or if it’s even possible. Whether a prisoner can open a joint bank account with someone else can depend on the bank’s policies. If you’re opening a joint bank account and the bank requires you to do so in person, for example, you may need to provide documentation showing why the joint account owner cannot be present.

Required documentation can include having power of attorney granting you legal authority to act on behalf of the inmate. The rules for establishing power of attorney and the scope of powers granted can vary from state to state.

If the bank allows you to open joint accounts online, then you may not be asked for this document. You will, however, likely need to provide the following for a joint account:

•   The inmate’s name

•   Their date of birth and Social Security number

•   A current address, phone number, and email address

If you’re missing any of those pieces of information, you may not be able to proceed with opening a joint account online. You could call the bank to ask how you can finish the account setup if you run into issues.

Keep in mind that managing a joint bank account — one shared with an inmate before they’re incarcerated — may be handled differently. As mentioned, New York requires inmates to close existing accounts before entering prison. But other correctional systems may allow those accounts to remain open.

If you have a joint account with an inmate, it’s important to note whether any court orders exist or are likely to be filed that would allow for seizure of account assets for repayment of a nondischargeable debt, such as back child support, past due tax bills, and federal student loans. Keep in mind that co-borrowers for joint loans are equally responsible for shared debts, even if one person is incarcerated.

Required Documents to Open a Bank Account

Banks typically have a standard list of documents they require to open a bank account. The list can include:

•   Valid government-issued ID

•   Proof of address

•   Social Security number

•   Birth certificate when other forms of ID are unavailable

Opening bank accounts for inmates can require additional documentation if the bank needs a power of attorney form. An attorney can help you complete a power of attorney for an inmate, which may require a visit to the correctional facility if state law prohibits digital signatures. State law can also dictate whether a power of attorney for an inmate needs to be notarized in order to be legally valid.

Types of Bank Accounts for a Prisoner

The types of bank accounts you can open for a prisoner will generally be governed by Department of Corrections policy. But if you’re able to open a bank account for an inmate, you might be able to choose from these options:

•   Checking accounts

•   Savings accounts

•   Money market accounts

•   Certificate of deposit accounts

These options may also be available once an inmate is released. If a former inmate is having trouble getting a regular checking account after release, they might consider second chance checking or a prepaid debit card instead. These can be easier to access and provide support for day-to-day banking in a way that can be very helpful.

•   Second chance checking is designed for people who have been denied a checking account in the past. Usually offered at online or smaller, local banks, these accounts can help people to develop good banking habits so they can upgrade to regular checking later. They may not offer the full array of bells and whistles, and they may involve higher fees.

•   Prepaid debit cards, meanwhile, allow you to load funds onto the card, which you can then use to pay bills, make purchases, or withdraw cash at ATMs. A prepaid debit card is not a bank account but it can provide a formerly incarcerated person with a way to manage their money until they can get an account at a bank.

The Takeaway

Having a bank account can be a positive experience for inmates, but opening a bank account for a prisoner can be quite challenging. Not all states allow inmates to start accounts, and not all banks are willing to have prisoners as customers.

Whether you’re opening accounts for inmates while they’re incarcerated or after they’re released, choosing the right place to bank matters. Specifically, it’s important to find a bank that offers the best combination of features and benefits for inmates and former inmates and makes it possible for you to open that account before the prisoner is released.

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 4.20% APY on SoFi Checking and Savings.

FAQ

Can an incarcerated person open a bank account?

Whether an incarcerated person can open a bank account will depend on the policies set by the Department of Corrections in their state. Some correctional facilities allow inmates to have external bank accounts, while others limit inmates to having prison accounts only.

Can ex-prisoners have a bank account?

Yes, ex-prisoners can open bank accounts. However, their banking options may be limited if they have a negative ChexSystems report. Former inmates may consider second chance checking accounts if they’re unable to meet the requirements for a regular checking account.

How much money can a federal inmate have in their account?

The Bureau of Prisons (BOP) does not specify an upper limit on how much money a federal inmate can have in their prison account. Inmates can receive funds at a BOP-managed facility, which are deposited into their commissary accounts, by MoneyGram, Western Union, or U.S. Postal Service.


SoFi members with direct deposit activity can earn 4.20% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. 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 (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate. SoFi members with direct deposit are eligible for other SoFi Plus benefits.

As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.20% 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 Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.20% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

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

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

Interest rates are variable and subject to change at any time. These rates are current as of 10/31/2024. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2024 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
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.


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.

Our account fee policy is subject to change at any time.
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.

Photo credit: iStock/alfexe
SOBK0124030

Read more
Business Cash Management Explained

Business Cash Management: Tips for Managing Cash

If you’re running a business, you probably know that managing cash is critical to your success — so let’s share some tips on doing that even better. Solid cash flow is vital to keep a business thriving, whether you’re a sole proprietor or the head of a larger enterprise. Even businesses with strong earnings can struggle with cash flow. That’s why cash flow can be a sure sign of how healthy a business is — or is not.

So let us help you optimize that cash flow. We’ll share some smart insights and helpful tips on:

•  What cash management for business is

•  Why it’s so important

•  Ways you can improve your business cash management

Let’s get started.

What Is Business Cash Management?

Simply put, business cash management is basically the way you track and manage the money coming into and going out of your business – usually on a cash flow statement. Positive cash flow means more money is coming in through revenues or borrowing than is being used to pay expenses, such as payroll and rent.

That said, good cash management also means not having too much cash on hand. In that scenario, business owners, while cautious, may be missing out on future earnings growth when they neglect to invest cash back into the business.

Here’s another way to frame this principle: Take a look at your business’s balance sheet and check the ratio of current liquid assets to liabilities. A ratio that’s greater than one indicates good health (you’re not losing money), but if that ratio gets too high, you could be holding onto too much cash or other assets that could better be invested elsewhere.

đź’ˇ Quick Tip: Help your money earn more money! Opening a bank account online often gets you higher-than-average rates.

The Importance of Cash Management for Businesses

Cash flow is the essence of all businesses. Without cash, a business will struggle to meet expenses, pay suppliers, repay any investors, and, often most importantly, grow the business through marketing and/or new opportunities.

Strong cash management strategies can help business owners avoid taking on debt. It also gives them more control over everyday activities, decisions, and growth opportunities. What’s more, smart cash management is the best way for owners to fulfill their vision for their enterprise while meeting both their short, intermediate and long-term needs. There’s certainly a lot riding on cash management, so let’s dive into ways to optimize it.

Get up to $300 when you bank with SoFi.

No account or overdraft fees. No minimum balance.

Up to 4.20% APY on savings balances.

Up to 2-day-early paycheck.

Up to $2M of additional
FDIC insurance.


6 Tips for Managing Cash Flow

Cash management can be especially challenging for entrepreneurs and small business owners. Yet it is one of the most important financial strategies business owners must master. These six tips can help.

1. Learning Your Cash Flow Cycle

A cash flow cycle is the time it takes to purchase your supplies and materials (or prepare the work that goes into providing a service), transform them into a product, sell your offering, and collect payment that can go into your business bank account. Sounds simple but a lot can go haywire during that process.

That’s why it’s important for business owners to constantly update and monitor their balance sheets and profit and loss statements. Ideally, you want to know at any given time what happened in the cash-flow cycle last month. Also important: Knowing your projections for what’s going to happen next month.

Understanding your cash flow cycle can help identify and address inconsistencies such as a late-paying customer or a build-up of inventory. If your business is seasonal or cyclical, you want to be well-prepared for both the intensely busy times…and the lulls.

Recommended: How to Track Your Monthly Expenses: Step-by-Step Guide

2. Getting Payments on Time

Reminding customers to pay on time is one of the easiest but most necessary ways to manage cash flow. Late payments are a fact of life; common, even. Having receivables come in even a day or two past the due date can wreak havoc with your cash flow cycle and your bank account.

Consider setting up email reminders to all customers ten days, seven days, and two days before payment is due. Technology today makes it a snap to pre-schedule email blasts. If the payment is still late or only a partial payment was made, don’t hesitate to follow up with a personal note or phone call.

This simple solution can really work. Customers will pay more attention to timely payments when they know you are paying close attention.

3. Turning Over Inventory Quickly

Having an abundance of inventory on hand at a given time means that a bundle of cash is tied up in that unsold stock. That could be an issue, because those funds might otherwise be working to pay for operations and expenses. What’s more, if all of that inventory bought upfront doesn’t sell as expected, it could mean losses on top of that lack of cash. That could hurt your growth and business valuation.

Many small business owners have learned that, in terms of cash, it’s better to turn inventory more quickly. Of course, this will vary widely depending on your business – perhaps your product is handmade jewelry, perhaps its reconditioned air conditioners. As an example, you might want to boost inventory turn-over from twice a year to five times. More targeted marketing could contribute to this acceleration.

That said, finding the right inventory management to fit with your cash flow cycles takes some time and experience. Recent supply chain issues have shown how challenging inventory management can be. Again, constant monitoring of the cash flow cycle can help guide how you tweak things.

Recommended: How Much Does It Cost to Start a Business?

4. Understand Invoice Financing

Let’s say you hit a cash management hitch. If you do find yourself in a position where you have too much inventory on hand and you need cash to cover expenses, there is a path forward. Invoice financing companies will advance a full or partial amount of your outstanding invoices. You repay that amount plus interest after the invoice is paid.

This generally should only be considered as a stop-gap measure. Like credit cards, interest payments on invoice financing can add up fast and quickly get out of control. Consider the fact that annual percentage rates for invoice financing products can reach as high as a jaw-dropping 64%.

5. Cutting Costs

Monitoring and cutting costs on expenses is another tool for managing cash flow. After all, if less cash goes to pay overhead, more can be invested in the business. A few suggestions: Relying on online marketing efforts that can be less costly than traditional methods, outsourcing tasks that take too much time and money in-house, and reducing energy costs. You might also want to renegotiate outdated contracts and prices with suppliers. These are all areas business owners can consistently monitor to keep costs low.

đź’ˇ Quick Tip: Are you paying pointless bank fees? Open a checking account with no account fees and avoid monthly charges (and likely earn a higher rate, too).

6. Comparing Loans

Sometimes, a business could use a helping hand to smooth out its cash flow. Let’s say you have outstanding accounts receivable — in other words, you know money is due but you don’t have it yet — and you need the cash now. In this situation, taking a business loan can be an option to help bridge the gap.

Cash flow loans (like invoice financing explained above) are short-term loans or lines of credit. These are often used to cover expenses or to take advantage of opportunities that can increase revenue.

A working capital loan is another option that can be used to finance everyday business operations such as rent, payroll, or restocking inventory. These loans are not designed to finance long-term assets or investment. Companies with seasonal or cyclical sales often rely on working capital loans to provide relief during slow periods.

One caveat: Working capital loans are often tied to your personal credit, so missed payments or defaults will affect your credit score. Consider that carefully before you sign on.

In addition, there are a variety of small business loans available that are used to finance long-term expenses such as real estate, equipment purchases, or business expansion. These include SBA loans, business lines of credit, and term loans.

Whatever type of loan you choose, be sure to compare your options carefully. Look at terms, APR, and how much lending you qualify for among several lenders before taking on any short or long-term debt. Spending some time and energy on research will help ensure you get the right form of financing.

The Takeaway

Cash flow management is an essential part of running a successful business of any size. Carefully monitoring cash flow, and learning some simple strategies to maximize it can take your small business to the next level.

Whether your business is a full-time job or just a side gig, it’s important to keep your business cash flow separate from your personal cash flow. In both cases, you’ll want to find a bank account that pays a competitive rate, charges no or low fees, and makes it easy to access your money.

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 4.20% APY on SoFi Checking and Savings.


Photo credit: iStock/AlexSecret

SoFi members with direct deposit activity can earn 4.20% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. 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 (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate. SoFi members with direct deposit are eligible for other SoFi Plus benefits.

As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.20% 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 Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.20% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

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

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

Interest rates are variable and subject to change at any time. These rates are current as of 10/31/2024. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2024 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
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.


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.

Our account fee policy is subject to change at any time.
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.

SOBK0124031

Read more
TLS 1.2 Encrypted
Equal Housing Lender