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Paying for college often requires some form of student borrowing, but not all student loans work the same way. One of the biggest distinctions in the student loan system is between undergraduate and graduate borrowing. While both types of students may rely on federal and private loans, the rules, limits, and interest rates can vary significantly depending on your academic level.

Understanding these differences is especially important for student planning to move from an undergraduate program into graduate or professional school. Policy changes, borrowing caps, and eligibility requirements can dramatically alter how much aid you can access and how much debt you may be able to carry. With recent changes eliminating federal Grad PLUS loans starting in the 2026-27 academic year, graduate students will face a different borrowing landscape than in the past.

What follows is a comprehensive look at grad vs. undergrad loans and how students can plan strategically for higher education costs.

What Does Undergraduate Mean?

An undergraduate student is typically someone pursuing their first college degree beyond high school. This includes associate degrees (usually two years) and bachelor’s degrees (generally four years).

Undergraduates typically attend school full-time, though some choose to enroll part-time. Many are considered financially dependent on their parents, particularly for federal finance aid purposes. This dependency status influences how much aid they can receive and which loans are available to them.

💡 Quick Tip: Make no payments on SoFi private student loans for six months after graduation.

What Does Graduate Mean?

A graduate student is someone who has already earned a bachelor’s degree and is pursuing advanced education, such as a master’s degree, doctoral degree, or professional degree (such as law or medicine). Graduate programs are typically more specialized and academically demanding than undergraduate programs. They also tend to be more expensive, though scholarships and assistantships can offset costs.

Differences Between Undergraduate and Graduate Programs

Undergraduate and graduate programs not only differ academically, but also financially. Below are key differences between student loans for undergraduates and graduates.

1. Dependency Status

One of the biggest differences between undergraduate loans and loans for graduate students is dependency status. Undergraduate students may be classified as either dependent or independent, depending on factors such as age, marital status, and whether they have dependents of their own.

Dependent undergraduates must report parent income and assets on the Free Application for Federal Student Aid (FAFSA®), which can affect their eligibility for need-based aid. Independent undergraduates do not need to include parental financial information.

Graduate students, by contrast, are always considered independent students for federal aid purposes. This means they do not need to provide parents’ financial information, and only the student’s income and assets are considered when determining eligibility.

2. Interest Rates on Federal Student Loans

Federal student loan interest rates differ depending on whether the borrower is an undergraduate or graduate student. Undergraduate students qualify for lower interest rates on federal loans than graduate students. For loans disbursed between July 1, 2025 and July 1, 2026, undergraduates borrowers pay 6.39% on Direct Subsidized Loans and Direct Unsubsidized Loans, whereas graduate or professional students pay 7.94% for Direct Unsubsidized Loans (they don’t have access to Unsubsidized Loans).

Because graduate students no longer qualify for subsidized loans, interest begins accruing immediately upon disbursement, increasing the total cost of borrowing.

3. Loan Type

Undergraduate students have access to both Direct Subsidized and Direct Unsubsidized Loans. Subsidized loans are especially valuable because the federal government covers the interest while the student is enrolled at least half-time and for six months post graduation.

Graduate students, on the other hand, are only eligible for Direct Unsubsidized Loans. Starting July 1, 2026, federal Grad PLUS loans will no longer be available, removing a major borrowing option that previously allowed graduate students to cover remaining education costs beyond unsubsidized loans loan limits. Borrowers who already received a Grad PLUS loan before June 30, 2026, however, can continue borrowing under current terms through the 2028-29 academic year.

4. Borrowing Limits

Borrowing limits are another major difference between undergraduate vs. graduate school loans. Undergraduate students face relatively low annual lifetime loan caps, especially if they are classified as dependent students. These limits are designed to prevent excessive debt early in a student’s academic career.

Undergraduate students can borrow between $5,500 and $12,500 annually in federal Direct Subsidized/Unsubsidized Loans, depending on their year in school and dependency status, with total aggregate limits of $31,000 for dependent students and $57,500 for independent students.

Graduate students can access $20,500 per year in Unsubsidized Loans with an aggregate limit of $138,500 (including all federal loans received for undergraduate study). Effective July 1, 2026, students in graduate programs (master’s, PhD, etc.) will have the same annual borrowing limit ($20,500) but face an aggregate limit of $100,000 (not including loans borrowed as an undergraduate); students in professional programs (medical, dental, law, pharmacy, etc.) will have a $50,000 annual borrowing limit and a $200,000 lifetime borrowing limit (not including loans borrowed as an undergraduate).

Without access to Grad PLUS loans (which cover the full cost of attendance), new graduate student borrowers may find that federal loans alone are not sufficient to cover the full cost of attendance, particularly at more expensive private universities and professional schools.

Recommended: Student Loan Payment Calculator

5. Interest Rates on Private Student Loans

Private student loan interest rates are determined by the lender and are based on factors such as credit score, income, and debt-to-income ratio. Undergraduate students often need a cosigner — typically a parent — to qualify for competitive private loan rates due to limited credit history. Rates on private student loans can sometimes be lower than federal rates, but you generally need excellent credit to qualify for the lowest rates.

Graduate students may qualify for private graduate loans on their own, especially if they have established credit or stable income.

Interest starts accruing immediately after loan disbursement, and you may have to start making payments while you’re still in school (policies vary by lender). In addition, private student loans lack the same borrower protections that come with federal student loans, such as income-driven repayment and federal forgiveness programs.

6. Student Loan Refinancing

Student loan refinancing allows borrowers to replace one or more existing loans with a new loan, ideally at a lower interest rate. Both undergraduate and graduate borrowers can refinance. Eligibility and terms depend on lenders’ criteria, which may include credit, income, and loan details.

Undergraduates may choose to refinance after graduation once they have steady income and good credit. Graduate borrowers, who often accumulate larger balances, may refinance to reduce monthly payments or interest costs. However, refinancing federal loans into private loans eliminates access to federal benefits, which may be particularly risky for graduate student borrowers with high debt and uncertain income.

7. Federal Grants

Federal grants are far more accessible to undergraduate students than to graduate students. Programs like the Pell Grant are designed specifically for undergraduates with significant financial need and do not require repayment.

Graduate students generally do not qualify for federal grants, with limited exceptions for specific programs or fields of study. As a result, graduate funding relies more heavily on loans, assistantships, and employer support.

8. Eligibility for Income-Driven Repayment Plans

Both undergraduate and graduate federal student loan borrowers are eligible for income-driven repayment (IDR), which caps monthly payments based on income and family size. An income-driven plan also extends your loan term to 20 or 25 years. If your federal student loans aren’t fully repaid at the end of the repayment period, any remaining loan balance may be forgiven.

There are currently three IDR plans, but borrowers who take out loans on or after July 1, 2026 will only have access to one income-based repayment plan — the Repayment Assistance Plan (RAP). Under RAP, monthly payments will be calculated as a percentage of the borrower’s adjusted gross income minus $50 per month per dependent. RAP provides loan forgiveness after 30 years of qualifying payments.

While IDR plans can provide relief, they may result in higher total interest costs over time. Borrowers should carefully weigh the long-term implications, especially if they expect income growth after completing a graduate degree.

9. Availability of Parent PLUS vs. Grad PLUS Loans

Another important distinction is who can take out loans on a student’s behalf. Parents of dependent undergraduate students may access Parent PLUS loans to help cover education costs not met by other aid. Parent PLUS loans are not available to parents of dependent graduate students.

Graduate students previously had access to Grad PLUS loans, which allowed them to borrow up to the full cost of attendance. However, Grad PLUS loans will no longer be available starting on July 1, 2026. This policy change significantly limits federal borrowing options for graduate and professional students and increases the importance of alternative funding strategies.

💡 Quick Tip: Parents and sponsors with strong credit and income may find more-competitive rates on no-fees-required private parent student loans than federal parent PLUS loans. Federal PLUS loans also come with an origination fee.

Thinking Outside the Box: Paying for Graduate School

With fewer federal loan options available, graduate students may need to be more creative in financing their education.

Becoming a Teaching or Research Assistant

Many graduate programs offer teaching assistantships (TAs) or research assistantships. These positions often provide an hourly or monthly salary, tuition waiver, and/or stipend. In exchange, students assist with teaching undergraduate courses or conducting research alongside faculty members.

Assistantships can significantly reduce the need for student loans while also providing valuable academic and professional experience.

Working Full-Time as a Grad Student

Some students choose to work full-time while pursuing graduate school part-time or through flexible programs. While demanding, this approach allows students to pay tuition as they go and minimize borrowing.

Online and evening programs have made this option more feasible, particularly for working professionals seeking career advancement rather than a complete career change.

Finding Scholarships

Scholarships are not just for undergraduates. Many organizations, professional associations, and universities offer scholarships specifically for graduate students. These awards may be merit-based, need-based, or tied to a specific field of study.

Although scholarships may not cover the full cost of graduate school, stacking multiple smaller awards can significantly reduce a student’s dependence on loans.

Utilizing Employer Tuition Assistance Programs

Employer tuition assistance is an often-overlooked benefit. Many employers offer tuition reimbursement or direct tuition payments for employees pursuing advanced degrees related to their job.

This benefit can significantly offset graduate school costs and may come with the added advantage of continued employment and income while studying.

Attending School Part-Time to Reduce Debt Load

Attending graduate school part-time can lower annual tuition costs and allow students to spread expenses over a longer period. While it may extend the time to degree completion, it can reduce reliance on loans and improve long-term financial stability.

The Takeaway

Undergraduate and graduate student loans differ in key ways, including loan types, interest rates, and borrowing limits. Undergraduate students generally benefit from lower interest rates, access to subsidized loans, and federal grants, while graduate students often face higher costs and fewer aid options.

With the elimination of federal Grad PLUS loans beginning in July 2026, graduate students will need to plan even more carefully. Understanding these differences — and exploring alternatives like assistantships, employer benefits, and scholarships — can help students make informed decisions and avoid unnecessary debt.

Whether you’re just starting college or considering graduate school, knowing how student loans change at each stage can help you plan more effectively for the years ahead.

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

Do graduate students borrow more money than undergraduate students?

Generally, yes. Graduate and professional students tend to borrow significantly more than undergraduates. This is due to several factors, including higher tuition costs for advanced degrees, the fact that graduate students typically have fewer grant options, and higher federal borrowing limits. While undergraduate federal aggregate limits are relatively low ($31,000 to $57,500), graduate students have much higher limits on federal Unsubsidized Loans, and previously had access to Grad PLUS loans to cover the full cost of attendance.

Do graduate student loans have higher interest rates?

Yes, federal graduate student loans have higher interest rates than federal undergraduate student loans. For loans disbursed between July 1, 2025 and July 1, 2026, the rate for federal Direct Unsubsidized Loans for graduate students is 7.94%, while the rate for undergraduates is 6.39% for both subsidized and unsubsidized loans. Private loan rates vary based on creditworthiness, but some lenders may charge higher rates for graduate-level borrowing.

What is considered an undergraduate loan?

Undergraduate federal loans are financial aid options available to students pursuing an associate’s or bachelor’s degree. They primarily consist of federal Direct Subsidized and Direct Unsubsidized Loans, which offer lower interest rates and lower annual and aggregate borrowing limits than graduate loans. Private student loans are also available for undergraduates, often requiring a cosigner due to the borrower’s limited credit history.

Can graduate students get federal grants?

Generally, no. Federal grants, like the Pell Grant, are largely reserved for undergraduate students who demonstrate significant financial need. Graduate students rarely qualify for federal grants, with some exceptions for specific fields of study (like education). Graduate students typically rely on federal and private loans, as well as institutional funding like scholarships, fellowships, and assistantships, to finance their advanced education.

Are graduate student loans eligible for forgiveness programs?

Yes, graduate student federal loans are eligible for forgiveness programs, primarily through Income-Driven Repayment (IDR) plans and Public Service Loan Forgiveness (PSLF). IDR plans cap your monthly payments based on income and family size, with any remaining balance forgiven after 20, 25, or 30 years of qualifying payments. PSLF is an option for borrowers working full-time for a qualifying government or nonprofit organization, offering forgiveness after 10 years of payments. Refinancing federal loans into private loans, however, eliminates access to these federal forgiveness options.

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Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

SoFi Bank, N.A. and its lending products are not endorsed by or directly affiliated with any college or university unless otherwise disclosed.

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SOISL-Q126-005

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Conventional loans — mortgages that are not insured by the federal government — are the most popular type of mortgage and offer affordability to homebuyers.

Private mortgage lenders originate and fund conventional loans, which are then often bought by Fannie Mae and Freddie Mac, publicly traded companies that are run under a congressional charter.

By buying and selling these mortgages, Fannie and Freddie help to ensure a reliable flow of mortgage funding.

Requirements for Conventional Loans

It can be confusing to know how to qualify for a mortgage.

Just realize, for one thing, that a higher credit score is usually required for a conventional home loan than for an FHA loan backed by the Federal Housing Administration, a type popular among first-time homebuyers.

Here are factors a lender will consider when sizing you up for a conventional loan.

Credit Score

You’ll usually need a FICO credit score of at least 620 for a fixed-rate or adjustable-rate mortgage.

The FICO score range of 300 to 850 is carved into these categories:

•   Exceptional: 800 to 850

•   Very Good: 740 to 799

•   Good: 670 to 739

•   Fair: 580 to 669

•   Poor: 300 to 579

In general, the higher your credit score, the better the interest rate you’ll be offered.

Down Payment

Putting 20% down is desirable because it means you can avoid paying for PMI, or private mortgage insurance, which covers the lender in case of loan default.

But many buyers don’t put 20% down. The median down payment on a home for first-time buyers is 10%, according to a recent study by the National Association of Realtors®.

Conventional loans require as little as 3% down for first-time homebuyers, and the down payment can be funded by a gift from a close relative; a spouse, fiancé or domestic partner; a buyer’s employer or church; or a nonprofit or public agency. The gift may require a gift letter for the mortgage.

Just keep in mind that the smaller the down payment, the higher your monthly payments are likely to be, and PMI may come along for the ride until you reach 20% equity.

Debt-to-Income Ratio

Your debt-to-income (DTI) ratio helps a lender understand your ongoing monthly debt obligations relative to your gross monthly income.

To calculate back-end DTI:

1.    Add up your monthly bills (but do not include groceries, utilities, cellphone bill, car insurance, and health insurance).

2.    Divide the total by your pretax monthly income.

3.    Multiply by 100 to convert the number to a percentage.

In general, lenders like to see a DTI ratio of 36% but will accept 43%.

The Fannie Mae HomeReady® loan, for lower-income borrowers, may allow a DTI ratio of up to 50%.

In any case, the lower your DTI ratio, the more likely you are to qualify for a mortgage and possibly better terms.

Loan-to-Value Ratio

The loan-to-value ratio (LTV) is the amount of the mortgage you are applying for compared with the home value. The higher the down payment, the lower the LTV ratio.

Fannie Mae typically sets LTV limits at 97% for a fixed-rate mortgage for a principal residence (think: 3% down) and 85% for a fixed-rate or adjustable-rate loan for a one-unit investment property.

When LTV exceeds 80% on a conforming loan, PMI will likely apply, although some borrowers employ a piggyback loan to avoid mortgage insurance.

Conventional Conforming Loan Limits

Many loans are both conventional and conforming — meaning they meet the guidelines of secondary mortgage market powerhouses Fannie Mae and Freddie Mac, which buy such mortgages and often package them into securities for investors.

Conventional conforming loans fall below limits set by the Federal Housing Finance Agency (FHFA) every year. Staying under a conforming loan limit often equates to a lower-cost mortgage because the loan can be acquired by Fannie and Freddie.

The conforming loan limits for 2026 in many counties in the contiguous states, Washington, D.C., and Puerto Rico rose with market prices:

•   One unit: $832,750

•   Two units: $1,066,250

•   Three units: $1,288,800

•   Four units: $1,601,750

In high-cost areas like Alaska, Hawaii, Guam, and the U.S. Virgin Islands, the 2026 conforming loan limits are:

•   One unit: $1,249,125

•   Two units: $1,599,375

•   Three units: $1,933,200

•   Four units: $2,402,625

If you’re curious about your county’s specific conforming loan limits, you can check out this FHFA guide.

Nonconforming Loans

Word games, anyone? Nonconforming loans are simply mortgages that do not meet Fannie and Freddie standards for purchase. They usually take the form of jumbo loans and government-backed loans.

A homebuyer or refinancer who needs a mortgage beyond the FHFA limits can seek a jumbo mortgage loan. A jumbo loan is still a conventional loan if it’s not backed by a government agency; it’s just considered a “nonconforming” loan.

FHA, VA, and USDA mortgages — those backed by the Federal Housing Administration, Department of Veterans Affairs, and the U.S. Department of Agriculture — are also nonconforming loans.

Nonconforming mortgage rates for jumbo loans may be higher because the loans carry greater risk for lenders, but when the nonconforming loan is backed by the government, its rate might skew lower than conventional conforming rates.

The Takeaway

Conventional loan requirements are good to know when you’re looking at the most popular type of mortgage around. Would-be homebuyers will want to make sure their credit score, debt-to-income ratio, and down payment numbers are lined up as favorably as possible before pursuing their dream property.

Looking for an affordable option for a home mortgage loan? SoFi can help: We offer low down payments (as little as 3% - 5%*) with our competitive and flexible home mortgage loans. Plus, applying is extra convenient: It's online, with access to one-on-one help.

SoFi Mortgages: simple, smart, and so affordable.

FAQ

Are there any drawbacks to a conventional loan?

The main drawback to a conventional loan is that you will need to make some type of down payment on the property. It doesn’t need to be the 20% down payment that was common in decades past. But even a low down payment of, say, 3.5% could add up to tens of thousands of dollars given today’s home prices.

What’s the main reason I might not qualify for a conventional loan?

The most common reason someone might not qualify for a conventional home loan is usually related to credit — perhaps the applicant has a credit score below 620, or maybe there is some other significant warning sign on the credit report, such as a history of delinquencies or bankruptcy.

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SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.

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Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility-criteria for more information.

*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement. ^¹FHA loans are subject to unique terms and conditions established by FHA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. FHA loans require an Upfront Mortgage Insurance Premium (UFMIP), which may be financed or paid at closing, in addition to monthly Mortgage Insurance Premiums (MIP). Maximum loan amounts vary by county. The minimum FHA mortgage down payment is 3.5% for those who qualify financially for a primary purchase. SoFi is not affiliated with any government agency. ^†Veterans, Service members, and members of the National Guard or Reserve may be eligible for a loan guaranteed by the U.S. Department of Veterans Affairs. VA loans are subject to unique terms and conditions established by VA and SoFi. Ask your SoFi loan officer for details about eligibility, documentation, and other requirements. VA loans typically require a one-time funding fee except as may be exempted by VA guidelines. The fee may be financed or paid at closing. The amount of the fee depends on the type of loan, the total amount of the loan, and, depending on loan type, prior use of VA eligibility and down payment amount. The VA funding fee is typically non-refundable. SoFi is not affiliated with any government agency. Third Party Trademarks: Certified Financial Planner Board of Standards Center for Financial Planning, Inc. owns and licenses the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®
Checking Your Rates: To check the rates and terms you may qualify for, SoFi conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, we will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.

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There are two basic types of income: earned and unearned. Earned income is the money you make from working, and unearned income is money you receive that isn’t tied to a business or job.

The difference between these two types of income is critical when saving for retirement and paying taxes. Here’s what you need to know about each of them as well as how they affect your finances.

What Is Unearned Income?

Unearned income is a type of passive income. It’s money you make without working or performing some kind of professional service. For example, money you receive from investing, such as dividends, interest, and capital gains, is unearned income.

Other types of unearned income include:

•   Retirement account distributions from a 401(k), pension, or annuity

•   Money you received in unemployment benefits

•   Taxable social security benefits

•   Money received from the cancellation of debt (such as student loans that are forgiven)

•   Distributions of any unearned income from a trust

•   Alimony payments

•   Gambling and lottery winnings

Dividends from investments in the stock market and interest are two of the most common forms of unearned income. Dividends are paid when a company shares a portion of its profits with stockholders. They may be paid monthly, quarterly, semiannually, or annually.

Interest is usually generated from interest-bearing accounts. These include savings, checking, and money market accounts as well as certificates of deposit (CDs).

How Is Earned Income Different From Unearned Income?

Earned income is the money you make from a job. Any money you earn from an employer, including wages, fees, and tips from which income taxes are withheld, counts as earned income.

Those wages still count as earned income if you’re part of the freelance economy and the companies you work for don’t withhold taxes. They could include wages earned for professional or creative services, driving for a rideshare service, or running errands.

Money you make from self-employment — if you own your own business, for example — also counts as earned income, as does money you earn from a side hustle.

Other types of earned income include benefits from a union strike, disability benefits you receive before you reach full retirement age, and nontaxable combat pay. This guide can help you learn about all the different types of income.

You can keep tabs on all the types of income you have by tracking your checking, savings, investment, and retirement accounts in one place with an online money tracker. It allows you to organize your accounts on a single dashboard and monitor your credit score and budget to achieve your financial goals.

How Income Types Affect Taxes

All earned income is taxed at your usual income tax rate. Taxes on unearned income are more complicated and depend on the type of unearned income you have, including the following.

Interest

Interest, which is unearned income from financial instruments such as bank accounts and CDs, is taxed the same as earned income.

Dividends

Dividends from investments fall into two categories: qualified and nonqualified. Generally, qualified dividends are those paid to you by a company in the U.S. or a qualified foreign company and are taxed at a lower rate. Nonqualified dividends don’t meet IRS requirements to qualify for the lower tax rate and are taxed at the same rate as ordinary income.

Capital Gains

Investments that are sold at a profit are subject to capital gains taxes. If you held the investment for less than a year, your earnings are subject to short-term capital gains rates, which are equal to your regular income tax rate. If you kept the investment for a year or more, it’s subject to long-term capital gains rates, which means it will be taxed at 0%, 15%, or 20%, depending on your taxable income and filing status. The higher your taxable income is, the higher your rate will be.

Social Security

If your income is more than $25,000 a year for individuals or $32,000 a year for married couples filing jointly, you will pay federal income tax on a portion of your Social Security benefits. You’ll be taxed on up to 50% of your benefits if your income is between $25,000 and $34,000 for an individual or $32,000 to $44,000 for a married couple, and you’ll be taxed on up to 85% of your benefit if your income is more than that.

Alimony

As a result of the Tax Cuts and Jobs Act of 2017, alimony payments that are part of divorce agreements made after January 1, 2019, are not taxable by the person who is paying the alimony, nor are they taxable for the person receiving the alimony.

Gambling Winnings

Money earned from gambling, including winnings from casinos, lotteries, raffles, and horse races, is fully taxable. This applies to cash and to prizes such as vacations and cars, which are taxed at their fair market value.

Debt Cancellation

If you have a debt canceled or forgiven for less than the amount you were required to pay, the canceled debt is taxable, and you must report it on your tax return. Starting in 2026, this includes the forgiven amount of certain federal student loans. There are exceptions: Public Service Loan Forgiveness, Teacher Loan Forgiveness, and Death and Disability Discharge are still tax-free. Debt payoff planning can help you resolve any outstanding debts you may have.

How Earned vs. Unearned Income Affects Retirement Savings

Retirement accounts, including 401(k)s, IRAs, and the Roth versions of both, provide tax advantages that help boost the amount that you can save.

For example, 401(k) contributions are made with pre-tax dollars, which can then be invested in the account. The investments are allowed to grow tax-deferred until withdrawals are made in retirement, at which point they become subject to income tax. In contrast, your contributions to Roth accounts are made with after-tax dollars. These increase tax-free, and withdrawals made in retirement are not subject to income tax.

Retirement accounts can only be funded with earned income. You can’t use unearned sources of income to make contributions.

There are certain exceptions to this rule. If you’re married and you file a joint return with your spouse and you don’t have taxable compensation, you may be able to contribute to an IRA as long as your spouse did have taxable compensation.

The Takeaway

The difference between earned income and unearned income is an important distinction, especially when it comes to paying your taxes. Unearned income, which is income you make not from a job but through other means, such as investments, can be taxed at different rates, depending on its type. Make sure you understand yours and their tax implications. Doing so can significantly impact how you save for your future.

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.

SoFi helps you stay on top of your finances.

FAQ

What is the difference between earned and unearned income?

Earned income is cash or in-kind benefits people receive in exchange for work or service, including employment and self-employment. Unearned income is cash or in-kind benefits received without being required to perform work or services.

Why do I need to know the difference between earned and unearned income?

It’s important to understand the difference between earned and unearned income because the two may be taxed differently. Also, in most cases, you must use earned income to fund your retirement accounts.

What is an example of unearned income?

Unearned income is money you receive without working for it. Interest, such as that from a bank account, and dividend payments are two of the most common types of unearned income.

Do I have to pay taxes on unearned income?

The answer is yes. Though it’s not subject to employment taxes (such as Social Security and Medicare, and, in most cases, payroll taxes), unearned income is generally treated as taxable income.

How does being a freelancer affect my taxes?

According to the IRS, a self-employed individual is generally required to file an annual income tax return and pay estimated taxes quarterly. You have to file an income tax return if your net earnings from self-employment were $400 or more. If your net earnings from self-employment were less than $400, you still have to file an income tax return if you meet any other filing requirement.

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With the cost of higher education out of reach for many, more young people are flocking to high-paying trade jobs that don’t require a bachelor’s degree. Many of these jobs pay well, but they are typically in high demand due to unpredictable job markets and economic conditions.

What Is a Trade Job?

A trade job is a profession that doesn’t require a college degree, but rather a specialized skill or skill set obtained through a trade school or on-the-job experience and training. Popular trade jobs include construction managers, technicians, dental hygienists, mechanics, commercial pilots, and real estate brokers.

Pros of a Skilled Trade Job

A skilled trade job can be an attractive career path for a couple of reasons:

Educational Requirements

Unlike careers that require a college degree — which can cost hundreds of thousands of dollars and take four years to complete — trade jobs can often be obtained with less than two years of specialized education and at a fraction of the cost. Some trade jobs do not require any supplemental education at all, allowing trade workers to earn a living without being saddled by student loan debt.

Job Security

Many trade jobs are in high demand due to the specialized knowledge and skilled physical labor needed to perform them. They can also have a lower risk of outsourcing or automation because they require a human to be physically present.

Recommended: Is the Average College Tuition Rising?

Cons of a Skilled Trade Job

On the other hand, there are downsides to some trade jobs, including:

Physical Demands

Trade jobs involving physical labor, such as construction workers and mechanics, can take a toll over the course of a long career.

Potential Dangers

Certain trade jobs have high injury and mortality rates, particularly those involving the operation of heavy machinery or working in hazardous environments.

25 Trade Jobs That Make the Most Money

Despite the conventional wisdom that a bachelor’s or master’s degree is required to earn a good salary, trade jobs can pay very well. In fact, some of the highest-paying jobs in certain states are skilled trades.

Here are 25 of the highest-paying trade jobs in the last several years, according to data from the U.S. Bureau of Labor Statistics:

1. Transportation, Storage, and Distribution Manager

•   2024 Median Annual Salary: $102,010

•   Requirements: High school diploma or equivalent, 5+ years of work experience

•   Job Description: Supervise and coordinate the transportation, storage, testing, and shipping of materials or products in accordance with government regulations.

•   Duties:

◦   Supervising workers involved in receiving or shipping

◦   Inspecting warehouse and equipment safety

◦   Analyzing logistics and collaborating with other departments

2. Elevator/Escalator Installers and Repairer

•   2024 Median Annual Salary: $106,580

•   Requirements: High school diploma or equivalent, apprenticeship, license (most states)

•   Job Description: Assemble, install, maintain, and fix elevators, escalators, chairlifts and other moving walkways and equipment. In addition to understanding the mechanics and components of each system, they are typically involved in the physical repair or replacement of parts, as well as testing equipment to ensure it meets specifications.

•   Duties:

◦   Assembling elevators, escalators, and similar units

◦   Conducting preventative maintenance and inspections

◦   Maintaining service records

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3. Nuclear Power Reactor Operator

•   2023 Median Annual Salary: $120,350

•   Requirements: High school diploma or equivalent, long-term on-the-job training, U.S. Nuclear Regulatory Commission license

•   Job Description: Control and maintain the systems that generate and distribute power to businesses, homes, or factories. This can include monitoring and adjusting control rods to moderate the amount of electricity a plant generates, controlling cooling systems, and implementing safety procedures.

•   Duties:

◦   Monitoring voltage and electricity grids

◦   Adjusting control rods and electricity output

◦   Recording systems data

4. Radiation Therapist

•   2023 Median Annual Salary: $98,300

•   Requirements: Associate degree (preferred) or certificate, state and national license

•   Job Description: Administer radiation therapy to patients with cancer.

•   Duties:

◦   Explaining treatment plans to patients

◦   Calibrating and operating radiation machinery

◦   Monitoring patients and keeping records of treatment

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5. Subway and Streetcar Operator

•   2023 Median Annual Salary: $84,270

•   Requirements: High school diploma or equivalent, moderate on-the-job training, local transit training program (varies by location)

•   Job Description: Operate subways and aboveground street cars, ensuring passengers safely move from one location to another.

•   Duties:

◦   Operating train controls

◦   Making announcements and providing verbal directions to passengers

◦   Ensuring passenger safety

6. Nuclear Medicine Technologist

•   2024 Median Annual Salary: $97,020

•   Requirements: Associate degree from an accredited nuclear medicine technology program, state license, long-term on-the-job training

•   Job Description: Prepare and administer radioactive drugs for imaging or treatment, typically within hospitals, medical labs, and care centers.

•   Duties:

◦   Explaining medical procedures to patients

◦   Preparing and administering drugs

◦   Maintaining and operating imaging equipment

7. Gas Plant Operator

•   2023 Median Annual Salary: $82,560

•   Requirements: High school diploma or equivalent, long-term on-the-job training

•   Job Description: Oversee the day-to-day operations of industrial power plants used by utilities, oil and gas, and manufacturing companies.

•   Duties:

◦   Maintaining equipment and machinery

◦   Ensuring compliance with safety and regulatory standards

◦   Supervising employees and contractors at the plant

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8. Dental Hygienist

•   2024 Median Annual Salary: $94,260

•   Education Requirements: Associate degree, state license

•   Job Description: Examine patients for oral diseases and provide preventative care and education about oral hygiene.

•   Duties:

◦   Taking dental x-rays

◦   Assisting dentists in providing teeth cleaning and plaque removal

◦   Educating patients about oral hygiene techniques

9. Diagnostic Medical Sonographer

•   2024 Median Annual Salary: $89,340

•   Requirements: Associate degree, state license or certification (some states)

•   Job Description: Operate sonographs to produce images of the inside of a body to assess and diagnose medical conditions.

•   Duties:

◦   Prepping and administering sonograph exams

◦   Reviewing images and test results for quality

◦   Analyzing diagnostic information and providing summaries for physicians

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10. Electrical Line Installer and Repairer

•   2024 Median Annual Salary: $92,560

•   Requirements: High school diploma or equivalent, long-term on-the-job training

•   Job Description: Install and repair cables or wires used in electrical power systems and telecommunications systems.

•   Duties:

◦   Installing, inspecting, and testing power lines and equipment

◦   Identifying defective devices, transformers, and switches

◦   Installing power lines between buildings and structures

11. Construction Manager

•   2024 Median Annual Salary: $106,980

•   Requirements: High school diploma or equivalent, 5+ years of experience

•   Job Description: Supervise and coordinate the activities of construction workers.

•   Duties:

◦   Overseeing construction projects

◦   Scheduling and supervising on-site contractors

◦   Preparing and monitoring budgets

12. Aircraft and Avionics Equipment Mechanic and Technician

•   2024 Median Annual Salary: $79,140

•   Requirements: Certificate from a Federal Aviation Administration-approved program

•   Job Description: Repair and perform maintenance on aircraft.

•   Duties:

◦   Diagnosing mechanical and electrical issues

◦   Repairing aircraft components

◦   Testing aircraft parts with diagnostic equipment

13. Boilermaker

•   2024 Median Annual Salary: $73,340

•   Requirements: High school diploma or equivalent, apprenticeship

•   Job Description: Assemble, maintain, and repair boilers, vats, and other containers used to hold liquids and gas.

•   Duties:

◦   Reading blueprints to determine where to position boiler parts

◦   Assembling boiler tankers using welding machines

◦   Cleaning boiling vats and replacing broken valves and pipes

14. Wellhead Pumper

•   2023 Median Annual Salary: $71,830

•   Requirements: High school diploma or equivalent, moderate on-the-job training

•   Job Description: Operate power pumps and equipment used to extract oil or gas from an oil field well.

•   Duties:

◦   Assembling pumps and attaching hoses to wellheads

◦   Operating pumps and monitoring flow

◦   Transferring oil to storage tanks or trucks

15. Electrical and Electronic Engineering Technologist and Technician

•   2024 Median Annual Salary: $77,180

•   Requirements: Associate degree (preferred), certificate from accredited program

•   Job Description: Assist electrical engineers with the design and development of communications equipment, computers, medical devices, and other electrical equipment.

•   Duties:

◦   Designing and assembling electrical systems

◦   Observing onsite systems placement and performance

◦   Performing quality control and identifying issues

16. Real Estate Broker and Sales Agent

•   2024 Median Annual Salary: $58,960

•   Requirements: High school diploma or equivalent, licensing exam

•   Job Description: Help clients buy, sell, or rent their properties.

•   Duties:

◦   Generating lists of properties for sale or rent and showing them to clients

◦   Advising clients on prices, mortgages, and market conditions

◦   Facilitating buyer/seller negotiations and final purchase or rental agreements

17. Respiratory Therapist

•   2024 Median Annual Salary: $80,450

•   Requirements: Associate degree

•   Job Description: Provide care for patients with respiratory issues.

•   Duties:

◦   Examining patients and recording symptoms and conditions

◦   Consulting with physicians on treatment

◦   Performing diagnostic tests

18. Construction and Building Inspector

•   2024 Median Annual Salary: $72,120

•   Requirements: High school diploma or equivalent

•   Job Description: Review building plans to ensure construction meets local and national regulations and ordinances.

•   Duties:

◦   Monitoring construction to ensure compliance

◦   Inspecting electrical and plumbing systems to ensure they are up to code

◦   Issuing violations for noncompliant work

19. Millwright

•   2023 Median Annual Salary: $62,980

•   Requirements: High school diploma or equivalent

•   Job Description: Install, dismantle, repair, reassemble, and move machinery in factories, power plants, and construction sites.

•   Duties:

◦   Repairing and replacing malfunctioning equipment

◦   Cleaning, adjusting, and calibrating new machinery

◦   Moving machinery and equipment

20. Electrician

•   2024 Median Annual Salary: $62,350

•   Requirements: High school diploma or equivalent, apprenticeship, license (most states)

•   Job Description: Install, maintain, and repair electrical power, communications, lighting, and control systems.

•   Duties:

◦   Identifying and repairing electrical problems

◦   Installing wiring and equipment for electrical systems

◦   Ensuring compliance with national and local codes

21. Plumber, Pipefitter, and Steamfitter

•   2024 Median Annual Salary: $62,970

•   Requirements: High school diploma or equivalent, apprenticeship

•   Job Description: Install and repair gas and water piping systems in homes, factories, and businesses.

•   Duties:

◦   Identifying and repairing plumbing problems

◦   Installing pipes and plumbing fixtures

◦   Cleaning drains, removing obstructions, and repairing or replacing broken pipes and fixtures

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22. Mining Roof Bolter

•   2023 Median Annual Salary: $66,660

•   Requirements: High school diploma or equivalent, moderate on-the-job training

•   Job Description: Operate machinery to install roof supporting bolts in underground mines.

•   Duties:

◦   Drilling bolt holes into roofs

◦   Performing safety checks on bolting equipment

◦   Extracting loose rock from bolting supports

23. Broadcast, Sound, and Video Technician

•   2024 Median Annual Salary: $56,600

•   Requirements: High school diploma or equivalent, moderate on-the-job training

•   Job Description: Operate and maintain electrical equipment used for television broadcasts, radio programs, live concerts, and films.

•   Duties:

◦   Setting up and operating equipment

◦   Monitoring and adjusting audio and video quality

◦   Repairing equipment and fixing recording issues

24. Heating, Air Conditioning, and Refrigeration Mechanic and Installer

•   2024 Median Annual Salary: $59,810

•   Requirements: Postsecondary nondegree award, lengthy on-the-job training

•   Job Description: Install and perform maintenance on heating, air conditioning, and refrigeration (HVACR) systems for buildings and private residences.

•   Duties:

◦   Installing, testing, and repairing HVACR systems

◦   Replacing and repairing defective parts

◦   Conducting overall system maintenance and performance improvements

25. Masonry Worker

•   2024 Median Annual Salary: $56,600

•   Requirements: High school diploma or equivalent, apprenticeship or on-the-job training

•   Job Description: Use bricks, concrete, and natural and manmade stones to build structures, walls, and walkways.

•   Duties:

◦   Designing blueprints and calculating materials needed

◦   Breaking and resizing materials into the required shape

◦   Aligning, constructing, and polishing finished structures

The Takeaway

Many trade jobs offer competitive pay and job security, without a significant upfront educational cost. Moreover, they provide an opportunity to make a difference by solving real-world problems. Choosing the right career path is an important step toward achieving your financial goals. It’s just as important to practice smart financial habits, such as setting spending limits, staying on top of your credit score, and establishing long-term goals.

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

What is a trade job?

A trade job does not require a college degree, but it may require other qualifications or on-the-job training.

What are the pros and cons of a trade job?

The benefits of a trade job may include a higher level of job security and not needing to have a college degree. However, trade jobs can be more physically demanding and dangerous than other professions.

What skilled trades are in demand?

According to the Bureau of Labor Statistics, wind turbine service technicians, solar photovoltaic installers, and physical therapist assistants are expected to experience the greatest job growth over the next ten years.

What are some of the best trades to learn that pay well?

Transportation managers, elevator installers, nuclear power reactor operators, and radiation therapists all earn a median salary above $80,000.

What are high-paying trade jobs that require no degree?

HVACR technicians, real estate agents, subway operators, and plumbers all pay above-average salaries and require no formal degree.

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When markets are volatile, and you start to see your portfolio shrink, there may be an impulse to pull your money out and put it somewhere safe — but acting on that desire may actually expose you to a higher level of risk. In fact, there’s a whole field of research devoted to investor behavior, and the financial consequences of following your emotions (hint: the results are less than ideal).

A better strategy might be to anticipate your own natural reactions when markets drop, or when there’s a stock market crash, and wait to make investment choices based on more rational thinking (or even a set of rules you’ve set up for yourself in advance). After all, for many investors — especially those with longer time horizons — time in the market often beats timing the stock market. Here’s an overview of factors investors might weigh when deciding whether to keep money in the stock market.

Why Market Volatility Can Be So Stressful

An emotion-guided approach to the stock market, whether it’s the sudden offloading or purchasing of stocks, can stem from an attempt to predict the short-term movements in the market.

This approach is called timing the market. And while the notion of trying to predict the perfect time to buy or sell is a familiar one, investors are also prone to specific behaviors or biases that can expose them to further risk of losses.

When markets experience a sharp decline, some investors might feel tempted to give in to FUD (fear, uncertainty, doubt). Investors might assume that by selling now they’re shielding themselves from further losses.

This logic, however, presumes that investing in a down market means the market will continue to go down, which — given the volatility of prices and the impossibility of knowing the future — may or may not be the case.

Focusing on temporary declines might compel some investors to make hasty decisions that they may later regret. After all, over time, markets tend to correct.

Likewise, when the market is moving upwards, investors can sometimes fall victim to what’s known as FOMO (fear of missing out) — buying under the assumption that today’s growth is a sign of tomorrow’s continued boom. That strategy is not guaranteed to yield success either.

The Case for Staying Invested: Time in the Market

Whether you should sell your assets and pull money out of the market will depend on an investor’s time horizon, or, the length of time they aim to hold an investment before selling.

Many industry studies have shown that time in the market is typically a wiser approach versus trying to time the stock market or give in to panic selling.

One such groundbreaking study by Brad Barber and Terence Odean was called, “Trading Is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors.”

It was published in April 2000 in the Journal of Finance, and it was one of the first studies to quantify the gap between market returns and investor returns.

•   Market returns are simply the average return of the market itself over a specific period of time.

•   Investor returns, however, are what the average investor tends to reap — and investor returns are significantly lower, the study found, particularly among those who trade more often.

In other words, when investors try to time the market by selling on the dip and buying on the rise, they may actually lose out.

The Biggest Risk of Selling: Missing the Market’s Best Days

By contrast, keeping money in the market for a long period of time can help cut the risk of short-term dips or declines in stock pricing. Staying put despite periods of volatility, for some investors, could be a sound strategy.

An investor’s time horizon may play a significant role in determining whether or not they might want to get out of the stock market. Generally, the longer a period of time an investor has to ride out the market, the less they may want to fret about their portfolio during upheaval.

Compare, for instance, the scenario of a 25-year-old who has decades to make back short-term losses versus someone who is about to retire and needs to begin taking withdrawals from their investment accounts.

And by staying invested, investors will experience both downturns and upswings. If they do sell, though, they’d have locked in their losses and could miss out on a potential market recovery.

3 Legitimate Reasons to Sell Your Investments

There are some reasonable situations in which an investor might sell their investments and walk away from the markets. Those could include the following.

You’ve Reached Your Financial Goal

If you’ve reached your financial goal, whatever that is, you may very well sleep better at night by taking your money out of the market and holding cash, though some investors may want to keep at least some money invested in one way or another. Again, this depends completely upon whether you’ve reached your goal, and don’t have any others that you may be working toward.

You Need to Cash for a Near-term Expense

If you need some cash to make a big purchase like a home or a vehicle, or maybe even for an emergency, you could consider the possibility of selling some of your investments. This may set you back a bit in reaching your goals, but the more immediate need may be more pressing.

The Investment’s Fundamentals Have Changed

It may also be time to sell if an investment’s fundamentals have changed. For instance, if you own several shares of Stock X, and Stock X’s revenue has taken a large dip for several consecutive quarters due to its products losing market share, it may be time to reallocate. There can be many reasons that could affect the investment’s fundamentals, and any one of them could be cause to sell.

The Downsides of Selling Based on Fear

There are a few disadvantages to pulling cash out of the market during a downturn.

You Could Lock in Your Losses

First, as discussed earlier, there’s the risk of locking in losses if you sell your holdings too quickly. It’s as simple as that: Selling your investments based on an emotional, fear-based reaction to the markets could mean you lock in a negative return.

It’s Nearly Impossible to Time the Market Correctly

While you could lock in your losses, you could, again, miss a potential rebound as well. Locking in losses and then losing out on gains basically acts as a double loss. When you realize certain losses, as when you realize gains, you will likely have to deal with certain tax consequences.

And while moving to cash may feel safe, because you’re unlikely to see sudden declines in your cash holdings, the reality is that keeping money in cash increases the risk of inflation.

Alternatives to Selling Everything

Here’s an overview of some alternatives to getting out of the stock market:

1. Rebalance Your Portfolio

Investors could choose to rotate some of their investments into less risky assets (i.e,. those that aren’t correlated with market volatility). Gold, silver, and bonds are often thought of as some of the safe havens that investors first flock to during times of uncertainty.

By rebalancing a portfolio so fewer holdings are impacted by market volatility, investors might reduce the risk of loss.

Reassessing where to allocate one’s assets is no simple task and, if done too rashly, could lead to losses in the long run. So, it may be helpful for investors to speak with a financial professional before making a big investment change that’s driven by the news of the day.

Sometimes, astute investors also choose to rebalance their portfolio in a downturn — by buying new stocks. It may be possible — if challenging — to profit from new trends that sometimes emerge during a financial crisis.

It’s worth noting that this investment strategy doesn’t involve pulling money out of the stock market, it just means selling some stocks to buy others. Also, for newer investors or those with low risk tolerance, attempting this strategy might not be a desirable option.

2. Review Your Diversification

Instead of shifting investments into safe haven assets, like precious metals, some investors prefer to cultivate a well-diversified portfolio from the get-go.

In this case, there’d be less need to rotate funds towards less risky investments during a decline, as the portfolio would already offer enough diversification to help mitigate the risks of market volatility.

3. Reassess Your Long-term Asset Allocation

During downturns, it could be worthwhile for investors to examine their asset allocations — or, the amount of money an investor holds in each asset type.

If an investor holds stocks in industries that have been struggling and may continue to struggle due to floundering demand, for whatever reason, they may opt to sell some of the stocks that are declining in value.

Even if such holdings get sold at a loss, the investor could then put money earned from the sale of these stocks towards safe haven assets, potentially gaining back their recent losses. Whenever considering a bigger shift, however, it can be wise to discuss options with a financial advisor.

The Takeaway

Pulling money out of the market during a downturn is a natural impulse for many investors. After all, everyone wants to avoid losses. But attempting to time the market (when there’s no crystal ball) can be risky and stressful. For many investors, especially investors with a longer time horizon, keeping money in the stock market may carry advantages over time.

One approach to investing is to establish long-term investment goals and then strive to stay the course, even when facing market headwinds. As always, when it comes to investing in the stock market, there’s no guarantee of increasing returns. So, individual investors will want to examine their personal economic needs and short-term and future financial goals before deciding when and how to invest.

Invest in what matters most to you with SoFi Active Invest. In a self-directed account provided by SoFi Securities, you can trade stocks, exchange-traded funds (ETFs), mutual funds, alternative funds, options, and more — all while paying $0 commission on every trade. Other fees may apply. Whether you want to trade after-hours or manage your portfolio using real-time stock insights and analyst ratings, you can invest your way in SoFi's easy-to-use mobile app.

Opening and funding an Active Invest account gives you the opportunity to get up to $1,000 in the stock of your choice.¹

FAQ

In general, should I sell my stocks when the market is down?

Investors can sell their investments at any time, including when the market is down. Whether they should sell or not will depend on their goals and investment strategy, but generally, it’s likely more in line with most strategies to hold investments through downturns.

When is it smart to pull out of stocks?

It may be wise to pull out of stocks when you reach your financial goals, need cash for a short-term expense, or when a stock’s fundamentals have changed.

What are the tax implications of selling stocks?

Selling stocks triggers a taxable event, and investors will have a tax liability related to their capital gains. The rate will depend, in part, on how long they held the stock.

How long does it take to get my money after I sell investments?

There may be a short waiting period between when you get your money after you sell your investments. The length depends on the type of investment and your brokerage, but generally, it could take a day or two.

Instead of selling, should I invest more during a downturn?

One strategy during a market downturn includes buying more investments, which is sometimes called “buying the dip.” Some investors think of it as buying investments at a discount as values go down from previous highs.

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¹Probability of Member receiving $1,000 is a probability of 0.026%; If you don’t make a selection in 45 days, you’ll no longer qualify for the promo. Customer must fund their account with a minimum of $50.00 to qualify. Probability percentage is subject to decrease. See full terms and conditions.
Investment Risk: Diversification can help reduce some investment risk. It cannot guarantee profit, or fully protect in a down market.

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

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