Apr
17
2023
Maximum Deposit and Balance Limits for Checking Accounts

Maximum Deposit and Balance Limits for Checking Accounts

By | Budgeting & Goals, Financial Independence, money | Comments Off on Maximum Deposit and Balance Limits for Checking Accounts

Having a bank account can simplify money management, but it’s important to know that there may be limits on how much money you can put in and move through your accounts. Limits like these can impact the timing and efficiency of your transactions.

Banking details matter to almost all of us. According to the Federal Reserve , 95% of U.S. households have at least one account with a bank or credit union. If you are wondering how much you should keep in checking and savings and whether bank accounts have limits, do read on. We’ll help you answer these important questions so you know where to keep your money and what to expect when you do your banking.

What are Maximum Deposit Limits?

Generally speaking, banks and credit unions don’t impose maximum deposit limits on checking and savings. This means that there usually is not a maximum deposit amount for your checking account that you need to know. The same applies for savings accounts. So if you were to win the lottery (wouldn’t it be nice?), you could go ahead and deposit that mega check into your checking or savings account without any issues.

There may, however, be maximum deposit limits for other types of deposit accounts. For example, if you’re opening a certificate of deposit (CD) account, the bank may cap those deposits at a certain amount. Depending on the bank, the maximum deposit may be as high as $1 million.

Now, do checking accounts have maximum limits on what you can deposit in a single transaction? Yes, they can, depending on the bank.

Maximum Account Balance Limits

Just as banks usually don’t impose a maximum deposit limit, they also don’t set limits on account balances. There is, however, a limit on how much of your money is protected by the Federal Deposit Insurance Corporation (FDIC).

The FDIC insures bank accounts in the very rare event of a bank failure. The FDIC coverage limit is $250,000 per depositor, per account ownership type, per financial institution. Having two checking accounts with the same bank or multiple savings or CD accounts at the same bank doesn’t affect your coverage limit if the total balance is under $250,000.

If you have multiple accounts at the same bank and the balances exceed $250,000, then it’s possible that part of your deposits might not be covered. The FDIC offers an online estimator tool that you can use to calculate how much of your deposits are covered at an insured bank.

One important note: Some banks participate in programs that extend the FDIC insurance to cover millions. If you want to keep large sums of money on deposit, you may want to consider these programs1.

What Is the Right Amount of Money to Keep In a Checking Account?

How much money can you have in a bank account? The short answer is as much as you want. But a better question might be, “How much money should you have in checking?”

There are different rules of thumb you might follow. Much depends on your personal situation and comfort level, but let’s consider two popular ways to look at this matter. You may choose the “emergency account” route and keep two to three months’ worth of expenses in checking. You could add another 20% to that amount as a just-in-case cushion to cover any small unexpected expenses that might come up so you don’t have to tap into your emergency savings.

If your bank imposes a minimum balance requirement, you could use that as a guide instead when deciding how much to keep in checking. So if your bank has a $1,000 minimum daily balance in order to avoid a monthly service fee, you might aim to keep at least that much in checking.

Get up to $300 when you bank with SoFi.

No account or overdraft fees. No minimum balance.

Up to 3.80% APY on savings balances.

Up to 2-day-early paycheck.

Up to $3M of additional
FDIC insurance.


What to Consider When Withdrawing Money

Maintaining a minimum balance in your checking and savings has some benefits. Specifically, it can help you to avoid fees or situations where you might run the risk of being short on funds. Here are three things to weigh when making withdrawals from bank accounts which can have implications in terms of maintaining your balance and avoiding excess charges.

Overdrafts

Overdraft occurs when you withdraw more money than you have available in your bank account, resulting in a negative balance. This is problematic because not only do you not have money to spend or pay bills, but also because your bank can also charge you a fee. According to the latest research from the Consumer Financial Protection Bureau , banks collected $15.47 billion in 2019 alone. Ouch! Keeping a minimum balance in checking and monitoring your balance regularly can help lower the risk of overdrafting your account.

Pre-Authorizations

Some transactions may require a pre-authorization hold before money is deducted from your account. For example, if you use your debit card to get $50 in gas, there may be an initial hold for that amount against your available funds. This lowers the dollar amount you have available for other spending. Having some extra funds in your accounts means all of your money isn’t tied up by these kinds of holds. Better yet, you might consider setting up a credit card account just for things like gas, hotel, and other travel purchases which often require pre-authorization.

Minimum Balance Requirements

As mentioned, banks and credit unions can impose minimum balance requirements for deposit accounts. This is separate from any initial minimum deposit requirement you might need to make to open the account. If your balance dips below the minimum deposit requirement, that could trigger a fee. How would you enter that “too low” zone? It might happen if you make a larger than usual withdrawal or debit card purchase, or decide to write a check that pays off your credit card bill one month.

Of course, you could avoid this by choosing a checking and savings option that doesn’t charge a monthly fee or set minimum balance requirements. This is an option if you’re banking with SoFi.

What to Consider When Depositing Money

The purpose of checking and savings is to hold your money until you need it. You therefore may not think twice about plunking some funds into your bank and parking it there. But when making deposits, it’s important to consider:

•   How much interest you’re earning with your bank vs. what you might earn elsewhere

•   How accessible your money is once you deposit it

•   What kind of fees you might pay to withdraw funds

Let’s review these points in a little more depth.

Investment Opportunities

Keeping all of your cash in checking and savings may seem like a good idea. After all, your money is relatively safe (thank you, FDIC), and you can dip into it as needed. But if you’re hoping to grow wealth, then investing some of your money in the stock market can deliver better returns over time. Allocating part of your paychecks to an investment account where you can buy stocks, exchange-traded funds (ETFs), cryptocurrency, or IPOs could pay off over the long term more so than simply earning interest with a bank account.

Liquidity

Liquidity is an investing term that describes how easy it is to turn an asset into cash. Bank accounts are highly liquid since you can get money from them fairly quickly. For example, if you need $500 to pay for an emergency vet bill, you could swipe your debit card, write a check, or hit the ATM.

When deciding how much money to deposit to checking and savings, consider an amount you’d feel comfortable having on hand if you needed it in an emergency. Then, if there’s an amount beyond that which you don’t think you’d need to access right away, you could invest that or put it into a high-yield CD account.

Transfer and Withdrawal Fees

There may be times when you need to transfer funds between bank accounts — perhaps on a regular basis. It’s worthwhile to consider the kind of fees this activity may trigger, so you don’t wind up taking too much of a financial hit. For example, if your bank sets a savings withdrawal limit, you may have to pay an excess withdrawal fee if you go over that limit. The Federal Reserve eliminated the “six withdrawal per month limit” for savings and money-market accounts, but banks can still charge a fee for excess withdrawals. Check the policies at your bank. This can guide you when deciding how much to deposit in savings. You’ll want to think about how soon you might need to take that money out again and what it might cost.

The Takeaway

Bank accounts can make life easier when you need to pay bills, make purchases with a debit card, or set aside money for savings goals. That said, you’ll want to be aware of limits on your accounts in terms of minimum balance requirements, deposit limits, and withdrawal limits. This can help you to avoid excessive fees. Because your checking should be a convenient financial tool, not something that is causing you concern or charging you an array of fees!

Bank Better with SoFi

If you’re looking for a checking and savings option that’s accessible and fee-friendly, consider online banking with SoFi today. Not only do eligible accounts earn a competitive APY, you’ll also bank free of account and overdraft fees. Plus SoFi recently announced that deposits may be insured up to $2 million through participation in the SoFi Insured Deposit Program.

Why not see how simple and stress-free banking can be?

3 Great Benefits of Direct Deposit

  1. It’s Faster

    2. As opposed to a physical check that can take time to clear, you don’t have to wait days to access a direct deposit. Usually, you can use the money the day it is sent. What’s more, you don’t have to remember to go to the bank or use your app to deposit your check.

  2. It’s Like Clockwork

    3. Whether your check comes the first Wednesday of the month or every other Friday, if you sign up for direct deposit, you know when the money will hit your account. This is especially helpful for scheduling the payment of regular bills. No more guessing when you’ll have sufficient funds.

  3. It’s Secure

    4. While checks can get lost in the mail — or even stolen, there is no chance of that happening with a direct deposit. Also, if it’s your paycheck, you won’t have to worry about your or your employer’s info ending up in the wrong hands.

FAQ

How much money can you put in a checking account?

Generally, there’s no checking account maximum amount you can have. There is, however, a limit on how much of your checking account balance is covered by the FDIC (typically $250,000 per depositor, per account ownership type, per financial institution), though some banks have programs with higher limits. Banks can also impose daily, weekly or monthly limits on mobile check deposits.

Should I keep all my money in my checking account?

Keeping all of your money in your checking account usually isn’t ideal, as you may be able to earn a higher rate of return by investing some of it. It can, however, be a good idea to keep two to three months’ worth of expenses in checking, plus a small cushion of 20% to 30% extra for any surprise expenses that might pop up.

What is the limit of depositing money in the bank?

Banks may not impose an aggregate limit on how much you can deposit to checking and savings. But there may be limits on how much you can deposit each day via mobile check deposit, with a teller or through the ATM. This limit can vary from bank to bank.

Photo credit: iStock/Prostock-Studio

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

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2025 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.

SoFi members with direct deposit activity can earn 3.80% 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 3.80% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant. SoFi members with Qualifying Deposits are not eligible for other SoFi Plus benefits.

SoFi Bank shall, in its sole discretion, assess each account holder’s 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 3.80% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have 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.

Separately, SoFi members who enroll in SoFi Plus by paying the SoFi Plus Subscription Fee every 30 days can also earn 3.80% APY on savings balances (including Vaults) and 0.50% APY on checking balances. For additional details, see the SoFi Plus Terms and Conditions at https://www.sofi.com/terms-of-use/#plus.

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.

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.

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Apr
17
2023

How to Balance the Urge to Travel and the Need to Save

By | Budgeting & Goals, credit card, Money & Life | Comments Off on How to Balance the Urge to Travel and the Need to Save

If you’re like most Americans, you’re looking forward to a well-earned vacation, especially as travel continues to come back from the pandemic. The percentage of Americans planning to travel at least once in summer 2023 rose to nearly 85%, compared to 80% in summer 2022, according to the Vacationer Summer Travel Survey.

That’s despite the fact that our travel dollars don’t go as far as they used to: Inflation has added significantly to travel costs. What’s more, many Americans are relying on credit card debt to make ends meet, and that can mean adding vacation expenses to their balances. So how can we weigh our desire for travel versus the need to stay on track with our finances, including savings?

“Logically, people know when they can’t afford something,” says Brian Walsh, senior manager of financial planning at SoFi. “But they still don’t always make the best decisions. The key is, how do you limit your spending?”

One answer: careful planning. If you approach your vacation strategically, you may be able to enjoy a getaway without jeopardizing your finances. Here, we’ll look at creative ways to fund your travel, along with plenty of cost-saving tips that can help you combat the urge to overspend.

How Much Does the Average Vacation Cost?

Travel can mean anything from a budget road trip to a grand tour around the world, so vacation costs naturally vary widely. According to Destination Analysts’ State of American Travel survey of more than 4,000 American adults, heading into spring 2023, the average annual travel budget among respondents was expected to be $4,677.

The survey also found that respondents planned to prioritize travel in the coming months over home improvements, clothing, entertainment, and dining out.

Of course, averages don’t necessarily tell your story. How much you’ll spend on your next vacation depends on where you’re going, how you’re getting there, and for families, how many people are traveling.

Recommended: How Families Can Afford to Travel

How Much Should You Be Saving?

As you try to balance the urge to get away and your need to save, “you’ll want to assess your total financial picture to determine how much flexibility you have for travel,” Walsh says.

Ask yourself the following questions:

•   Do I have enough in my emergency fund? (Ideally, three to six months of living expenses in case of a job loss or other sudden event.)

•   Do I have high-interest debt that’s weighing me down?

•   Am I saving enough for retirement?

These are the three areas that should be a savings priority before you budget for travel. When you can check off these boxes, you’re likely ready to hit the road, says Walsh. That is, he adds, if you have enough in your savings to pay for a vacation without going into massive credit card debt.

Recommended: Where to Find Book Now, Pay Later Vacations

6 Ways to Pay for Travel Without Sabotaging Your Savings

Finding ways to pay for airfares, hotels, and other costs that won’t deplete your savings or rack up credit card debt can help you keep your finances intact. Here are some ideas to consider.

1. Rent or Swap Your Space

If you can rent your apartment or home to other vacationers, you can use that money to pay for your lodging elsewhere. Or consider swapping homes with someone in your desired destination who’s planning on visiting your hometown.

Check with friends or family in or near your destination for the easiest swaps. Exchange sites such as Homestay and Home Exchanges can facilitate swaps, but may also list homes to rent, usually at much lower rates than hotels. Either way, it can mean saving a huge amount on lodging.

If you find someone to rent or swap and they don’t mind feeding your cat, picking up your mail, or watering your plants, you’ll save on the cost of a local pet or house sitter too.

2. Housesit or Pet Sit

By the same token, you may be able to find free or low-cost lodging by offering your services as a pet sitter or house sitter. Again, you’ll want to check with friends, family, and acquaintances. For a fee, you may also find opportunities in the U.S. and abroad on sites like Nomador and Mind My House.

Recommended: 25 Tips to Cut Costs When Traveling With Pets

3. Pick Up a Side Gig

Consider freelance professional work, rideshare driving, handyperson jobs, or other side gigs that can help fund your family vacation. This takes advance planning, but can be well worth the financial peace of mind. Consider offering your services through your neighborhood online classifieds, which are often free, or on for-fee platforms like Upwork.

You may want to put the extra cash in a designated savings account earmarked specifically for travel. That way you won’t inadvertently spend the money on other things.

4. Declutter and Earn Extra Money

How can spring cleaning benefit your summer vacation? Declutter your garage, basement, and attic by selling unwanted items and put that money toward your next vacation. You may be surprised at how much you can earn this way. Plus, you get a cleaner house!

5. Extend a Business Trip

If you can stay a few days extra after a conference or other business trip in an attractive destination, you’ll be reimbursed for at least one airfare and partial lodging costs, depending on the circumstances. In many cases, that can tip the scales so you can afford your getaway without financial stress.

6. Cut Back on Other Spending

Rejiggering your discretionary spending priorities may be all you need to take a debt-free vacation. Look closely at your spending on entertainment, meals out, hobbies, and other nonessential expenses. Are there places you can cut back to make room for travel expenses?

After your trip, you can reinstate your original budgets. Then again, you might discover you’ll enjoy a weekend getaway more than a new pair of boots.

4 Ways to Save on Travel Costs

Budget travel can be just as relaxing and reviving as a luxury trip. But it helps to learn a few tricks for reining in costs.

1. Be Flexible

Flexible plans can save you a bundle on travel expenses. Avoid peak travel times such as holidays, spring break, and high summer to save money on lodging, airfare, and more. Keep in mind, off season doesn’t have to mean the Bahamas in the heart of hurricane season. Traveling just a few days or weeks on either side of the rush can translate to significantly lower costs.

If you live near multiple airports, being flexible about where you fly from can also pay off. Walsh, who lives in Grand Rapids, MI, is about a two-hour drive from both Chicago and Detroit airports. For a recent vacation, he was able to save $1,000 on airfare by flying out of Chicago, a savings that more than made up for the gas and parking fees he paid to drive there.

You’ll also want to evaluate your departure times. Flying or driving early in the morning means you’ll likely have the better part of the day at your destination and save yourself a night’s hotel stay. With airlines, first and last flights of the day are often sold at a discount compared to late morning or afternoon flights.

Being willing to commute a bit on your trip is another good way to save, especially if you have a car or you’re in a spot with good mass transit. Hotels located on the outskirts of town or in the suburbs are often much less expensive than their downtown counterparts.

2. Compare Prices at Discount Travel Sites

Online travel agents and travel websites like Priceline, Expedia, Kayak, and Orbitz offer discounted airfares, hotels, and rental cars for thousands of locations. But rates vary widely among the sites, so you’ll want to look at several of them to find the lowest price. And restrictions may apply, such as no refunds or no date changes.

3. Track Prices

If you’re in the beginning stages of planning your trip and choosing between destinations, consider using apps such as Hopper, Skyscanner, or FareDrop to monitor airfares. Just plug in your departure airport(s) and the dates you want to travel, and the apps will send notifications when flight prices to those destinations drop.

Rebookey works the same way for hotels. It will periodically check to see if specific hotel rates fall. If you book a refundable hotel rate that allows you to cancel at any time, and the rate you book drops, you can rebook your reservation at the lower rate, then cancel the original.

4. Use Rewards and Cash Back

If you have an airline credit card or travel credit card, you already know that using points for airfares, hotels, and car rentals is one of the best ways to cut the cost of your trip. Plus, your card may provide valuable trip insurance to protect you from losing money if your plans go sideways.

Don’t forget any hotel loyalty programs you may belong to. Check for member discounts at properties in or near your destination.

If you have a cash-back credit card, you may have enough in the “bank” to cover some of your travel costs. At the very least, if you use your cash-back card to pay for all or part of your trip, you can start earning money toward your next vacation.

Recommended: Guide to Choosing Between Cash Back and Travel Rewards

The Takeaway

Indulging the urge to travel while honoring the need to save can be a challenge. It’s important to assess your total financial picture in order to determine how much discretionary income you have to spend on travel. Finding ways to pay for travel that won’t jeopardize your savings — like home swapping — can also help balance these two priorities. Finally, being flexible so you can find the best deals on airfare, lodging, and other travel costs can help make your trip more affordable.

SoFi Travel has teamed up with Expedia to bring even more to your one-stop finance app, helping you book reservations — for flights, hotels, car rentals, and more — all in one place. SoFi Members also have exclusive access to premium savings, with 10% or more off on select hotels. Plus, earn unlimited 3%** cash back rewards when you book with your SoFi Unlimited 2% Credit Card through SoFi Travel.

Wherever you’re going, get there with SoFi Travel.

FAQ

How can I balance travel with saving?

If you have three important financial building blocks in place — emergency savings, no or low credit card debt, and regular retirement savings contributions — you likely will find you have the discretionary funds to travel, especially if you plan your trip strategically to find the best deals.

Should I pay for my vacation with my credit card?

Paying for at least some of your travel costs with a credit card is just about inevitable. And paying with a cash-back or travel-rewards card can help you earn money or rewards for your next trip. What you want to avoid, however, is racking up massive credit card debt that will jeopardize your financial stability.

What are some good ways to save on travel costs?

Avoiding travel during peak times such as holidays, major events, and school vacations can be a great way to find deals. Renting or swapping your home, lodging off the beaten path, and using credit card and loyalty program rewards also help. Careful shopping, including using discount travel sites and fare tracking apps can take some time, but often pays off in big savings.

Photo credit: iStock/AndreyPopov

**Terms, and conditions apply: This SoFi member benefit is provided by Expedia, not by SoFi or its affiliates. SoFi may be compensated by the benefit provider. Offers are subject to change and may have restrictions, please review the benefit provider's terms: Travel Services Terms & Conditions.
The SoFi Travel Portal is operated by Expedia. To learn more about Expedia, click https://www.expediagroup.com/home/default.aspx.

When you use your SoFi Credit Card to make a purchase on the SoFi Travel Portal, you will earn a number of SoFi Member Rewards points equal to 3% of the total amount you spend on the SoFi Travel Portal. Members can save up to 10% or more on eligible bookings.


Eligibility: You must be a SoFi registered user.
You must agree to SoFi’s privacy consent agreement.
You must book the travel on SoFi’s Travel Portal reached directly through a link on the SoFi website or mobile application. Travel booked directly on Expedia's website or app, or any other site operated or powered by Expedia is not eligible.
You must pay using your SoFi Credit Card.

SoFi Member Rewards: All terms applicable to the use of SoFi Member Rewards apply. To learn more please see: https://www.sofi.com/rewards/ and Terms applicable to Member Rewards.


Additional Terms: Changes to your bookings will affect the Rewards balance for the purchase. Any canceled bookings or fraud will cause Rewards to be rescinded. Rewards can be delayed by up to 7 business days after a transaction posts on Members’ SoFi Credit Card ledger. SoFi reserves the right to withhold Rewards points for suspected fraud, misuse, or suspicious activities.
©2024 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender. NMLS #696891 (Member FDIC), (www.nmlsconsumeraccess.org).




Members earn 2 rewards points for every dollar spent on purchases. No rewards points will be earned with respect to reversed transactions, returned purchases, or other similar transactions. When you elect to redeem rewards points toward active SoFi accounts, including but not limited to, your SoFi Checking or Savings account, SoFi Money® account, SoFi Active Invest account, SoFi Credit Card account, or SoFi Personal, Private Student, Student Loan Refinance, or toward SoFi Travel purchases, your rewards points will redeem at a rate of 1 cent per every point. For more details, please visit the Rewards page. Brokerage and Active investing products offered through SoFi Securities LLC, Member FINRA/SIPC. SoFi Securities LLC is an affiliate of SoFi Bank, N.A.

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

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

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Apr
17
2023

3 Father-Son Trip Ideas

By | Credit, credit card, Family Finances | Comments Off on 3 Father-Son Trip Ideas

Travel isn’t the only way to strengthen your relationship with your dad. You can spend quality time together more easily and cheaply on the couch or in the backyard. But those routine interactions probably won’t become lifelong memories.

Exploring places together, from the Grand Canyon to a cool urban landscape, can take you out of your comfort zone and pull you closer. Discovering new sights, sounds, and tastes as a unit can be a wonderful way to reconnect.

Whether you’re the parent or an adult child, here are some inspiring ideas for creating an unforgettable trip:

•   How to plan a father-son trip

•   Ways to afford a father-son trip

•   Great destinations for father-son travel

Recommended: Apply for an Unlimited Cash Back Credit Card

Tips for Planning Your Trip

A little planning can help create a meaningful father-son trip that avoids the usual travel hiccups.

•   Set up a travel fund: The first step in planning any father and son trip is establishing a budget. Add up all the projected expenses, such as flights, hotel, attractions, food, entertainment, and incidentals. Once you have that figure, divide it by the number of months until your trip.

Then start contributing that amount each month. But don’t keep the money under your mattress: Set up a travel fund. The fund can be saved in a separate savings account or a short-term CD. Setting up automatic transfers or adding “found money” (say, a tax refund or a bonus at work) can speed up your savings’ growth. Look for a competitive annual percentage yield (APY) as well to help your money grow more rapidly. Online banks tend to offer the best rates.

•   Book now and pay later: Another easy way to manage your father-son trip costs is to book now and pay later. Many travel companies, airlines, and hotels offer payment plans, so you can book your trip and spread the costs over time. This can be helpful if you want to take advantage of early booking discounts or offers. And you may be able to avoid the steep interest fees that can accrue when you put everything on your credit card.

•   Consider travel insurance: Part of smart planning can be recognizing that sometimes things don’t go your way. Events may happen before or during your father-son trip (someone gets sick, your car decides to conk out) that may cost you additional money. Did you know that your favorite rewards credit card may already include travel insurance?

Your credit card travel insurance can cover things like lost luggage, new hotels, family emergencies, and other-last minute changes. You’ll want to learn what your specific card provides. If the coverage doesn’t meet your needs, you can look into additional travel insurance if you’re worried about things going awry.

•   Reward yourself. Reward points are available from all sorts of sources, such as credit cards, airlines, car rental agencies, hotel chains, bus and train lines, and more. Do your research to see what’s available, and you may be able to whittle your costs down or even score some freebies, such as a no-pay night at a hotel. Or you might score a free flight or an upgrade. Sometimes, when it comes to credit card miles vs. cash back, you may find that the travel bonus is better than the dollar bills.

Recommended: Traveling with a Pet

Popular Destinations for Fathers & Sons

Beaches, baseball games, breweries, and big cities: Those are just a few of the places that can make for a terrific father and son trip. The best destination for you will depend on your shared interests and budget. And also your timing: If it’s summer travel you’re planning, heading to Orlando may be too hot for some folks.

If your family tree goes back to Ireland, a long weekend in Dublin might make an incredible experience for you two to explore your roots. Closer to home, you might rather visit sites from the Revolutionary War if you’re history buffs.

Some fathers and sons might love to go camping; others prefer to stay at a swanky hotel in a big city and eat their way through some of the town’s best restaurants. It’s really all about what makes the two of you and your relationship tick while getting you out of your usual element.

3 Sample Getaway Itineraries

Need some help figuring out where to go? Here are a few itineraries for a father-son trip that may spark some ideas or even help you get booking.

1. Natural Wonders: National Parks

National parks are an excellent, affordable choice for a father-son trip, especially if you love the outdoors. With 63 national parks in 30 states, there’s no shortage of options to choose from. Purchasing a national park pass in advance will grant you access to all parks for one year. Expect to pay between $20 (seniors) and $80 for an annual pass. One idea:

•   Utah is a popular destination for those looking to explore the jaw-dropping natural wonders of the United States. The state is home to Arches, Bryce Canyon, Canyonlands, Capitol Reef and Zion National Parks, which all have awesome, unusual vistas.

•   Whether you are renting a car or using your own wheels to take a road trip through Utah, Zion National Park is a great option for a multi-day father and son trip. You can reserve a campsite at Watchman Campground; a free shuttle bus can take you to one of the many trails, where you can spend quality time birdwatching one of the 200 species at the park. Father and son evenings can be spent stargazing, as Zion is certified as an International Dark Sky Park.

•   Other activities include hiking the Emerald Pools Trail and driving 90 minutes to visit Bryce Canyon National Park, which is known for its unique, otherworldly rock formations called hoodoos. You can explore the park by foot or even by horseback.

2. Hit a Grand Slam: Stadium Trip

For fathers and sons who share a love of sports, a baseball trip can be an excellent choice. With over 2,400 MLB games per season played at 30 ballparks, there are plenty of opportunities to catch a couple of games and try some tasty stadium foods.

If you want to catch a couple of games at different stadiums, look no further than a father and son trip to Kansas City and St. Louis. (Bonus: With St. Louis being a travel hub, you’ll have many opportunities to use your favorite airline credit card and earn points.)

•   Start in St. Louis. After getting settled at your hotel, go visit the renowned Gateway Arch, where you can ascend inside and catch views of St. Louis.

•   Head down to Ballpark Village for a little pregame snack (maybe a Bratzel, a bratwurst wrapped in pretzel dough) and watch highlights on their many outdoor screens. Then enjoy the game at the adjacent Busch Stadium as well as the amazing cityscape views inside the stadium.

•   Another highlight of a father-son trip could be the Negro Leagues Baseball Museum which celebrates the rich history of African-American baseball while touching on the league’s social impact.

•   Hop behind the wheel and drive 250 miles to catch another game at Kansas City’s Kauffman Stadium. With its unique Crown scoreboard and 1970s architecture, it is recognized as one of the game’s best experiences.

•   You can hit up fan favorite Joe’s Kansas City Bar-B-Que for their famous, finger-lickin’-good food.

3. Make Family History: A Historical Father-Son Trip

For the history buffs, consider a historical father and son trip to Washington, D.C. With its abundance of museums, monuments, and government buildings, this city has something for everyone.

•   After you’ve checked into your lodging, you might take an evening monument tour that showcases the city’s stunning landmarks under glamorous lighting. There are both guided and self-guided tours, which are a great, affordable way to visit the sites without a lot of driving.

•   The next day, start with one or more of the city’s world renowned museums, such as the Smithsonian National Air and Space Museum, the Holocaust Museum, the National Portrait Gallery, or the National Museum of Asian Art.

•   You might spend an afternoon at Mount Vernon, the home of George Washington. Both self-guided and guided tours are available where you can learn about the life of our first President.

•   Another great stop on a father-son trip would be driving a little more than two hours to Gettysburg, PA, for their annual Civil War Reenactment. Walk through the different camp sites, explore the battlefield, and take in the sights and sounds of this historically accurate event.

Recommended: How to Save Money on Hotels

Accessible Ideas for Less Mobile Dads

For fathers and sons who may be less mobile, there are still plenty of trip options.

•   There are cruises and riverboat vacations that let you relax on board your ship and take in the sights.

•   Train travel can be another option, especially historic scenic railroads along the West Coast or through the Carolinas and Great Smoky Mountains.

•   Tours in your area can make for a fun father-son trip, too. The Oregon Fruit Loop, near the Hood River, brings visitors to 30 farms with fruit stands and wineries. This unique experience allows you to choose the time and pace you spend at each stop while spending quality time in the car together.

What About Father-Daughter Getaways?

Family bonding doesn’t have to be just for the guys in the family. For those looking for fun father-daughter getaways, as with father-son trips, it’s all about your shared interests. Beach lovers can spend a couple of days by the shore. Or if snowboarding is more your speed, head to the mountains. Can’t resist a musical or some other live theater? Try a visit to NYC and some Broadway shows.

For dads of younger daughters, Disney vacations can be a treat, or a weekend that revolves around a visit to one of the nine American Girl stores can be a great bonding experience.

The Takeaway

A father-son trip can be a fantastic way to have some quality time and make amazing memories. What’s more, by planning ahead, budgeting wisely, and knowing how to find good deals, you can have an experience that’s as affordable as it is unforgettable.

Whether you want to travel more or get a better ROI for your travel dollar, SoFi can help. SoFi Travel is a new service exclusively for SoFi members that lets you budget, plan, and book your next trip in a convenient one-stop shop. SoFi takes the guessing game out of how much you can afford for that honeymoon, family vacation, or quick getaway — and we help you save too.


SoFi Travel can take you farther.

Photo credit: iStock/VioletaStoimenova

1See Rewards Details at SoFi.com/card/rewards.


**Terms, and conditions apply: This SoFi member benefit is provided by Expedia, not by SoFi or its affiliates. SoFi may be compensated by the benefit provider. Offers are subject to change and may have restrictions, please review the benefit provider's terms: Travel Services Terms & Conditions.
The SoFi Travel Portal is operated by Expedia. To learn more about Expedia, click https://www.expediagroup.com/home/default.aspx.

When you use your SoFi Credit Card to make a purchase on the SoFi Travel Portal, you will earn a number of SoFi Member Rewards points equal to 3% of the total amount you spend on the SoFi Travel Portal. Members can save up to 10% or more on eligible bookings.


Eligibility: You must be a SoFi registered user.
You must agree to SoFi’s privacy consent agreement.
You must book the travel on SoFi’s Travel Portal reached directly through a link on the SoFi website or mobile application. Travel booked directly on Expedia's website or app, or any other site operated or powered by Expedia is not eligible.
You must pay using your SoFi Credit Card.

SoFi Member Rewards: All terms applicable to the use of SoFi Member Rewards apply. To learn more please see: https://www.sofi.com/rewards/ and Terms applicable to Member Rewards.


Additional Terms: Changes to your bookings will affect the Rewards balance for the purchase. Any canceled bookings or fraud will cause Rewards to be rescinded. Rewards can be delayed by up to 7 business days after a transaction posts on Members’ SoFi Credit Card ledger. SoFi reserves the right to withhold Rewards points for suspected fraud, misuse, or suspicious activities.
©2024 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender. NMLS #696891 (Member FDIC), (www.nmlsconsumeraccess.org).


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


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

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Apr
17
2023
Guide to Negotiating Financial Aid

Can You Negotiate Financial Aid?

By | Family Finances, Student Loans, student_loan | Comments Off on Can You Negotiate Financial Aid?

After you file the Free Application for Federal Student Aid (FAFSA®), you’ll receive a financial aid award from the colleges to which you’ve been granted admission. You may receive scholarships, grants, and loans. When you receive your financial aid awards from institutions, they may not cover every dollar of tuition, room, board, and fees. As a result, you may find that you cannot afford a particular institution.

It may be possible to negotiate your financial aid award with the financial aid office at each institution you’re considering. Continue reading for more information about how to negotiate financial aid awards and how to get more money from colleges.

What Is Financial Aid?

Financial aid is money you receive based on your financial aid award. There are different types of financial aid components that make up a financial aid award. You may want to think of it as a puzzle that could include grants, scholarships, work-study, and federal student loans. You can accept and decline different parts of the “puzzle” to create your own financial aid award. Applying for student loans, grants, certain scholarships, and work-study involves filing the FAFSA.

Grants and scholarships are forms of financial aid that you don’t have to pay back. Grants typically come from the federal government, states or colleges, and the amount you can get in grant money depends on your need and the type of institution you attend.

Scholarships on a financial aid award letter typically come from the institution for various reasons. They may be based on merit (for example, for good grades) or on talents you possess, such as music or athletic talent.

Work-study is a type of financial aid in which students who have financial need qualify for part-time employment on campus.

Federal student loans may also appear on your financial aid award. Federal student loans, which come from the federal government, must be repaid — with interest.

Every college offers a different amount of financial aid to the same student. In other words, if you apply and get accepted to five different schools, you will likely get five different aid awards. It’s worth learning more about how financial aid works at each institution by asking a financial aid professional at each institution you visit.

Recommended: FAFSA Guide

Is Your Financial Aid Amount Negotiable?

Yes, you can negotiate your financial aid amount. However, it’s important to realize that some pieces of the financial aid award are not negotiable. For example, first-year undergraduate dependent students can qualify for no more than $5,500 in subsidized and unsubsidized federal student loans. No more than $3,500 of this amount may be in subsidized loans.

In addition, it’s also important to understand that colleges may be limited in the amount they can offer you for additional financial aid. Even if you ask for all the gaps to be covered between the total cost and the amount you receive in financial aid, colleges may only be able to offer a small amount of additional financial aid.

5 Tips for Negotiating Financial Aid

Let’s take a look at a few tips for negotiating financial aid, from the presentation process to writing a letter for financial aid, as well as providing relevant supporting documentation.

1. Present the Financial Aid Office With a Specific Amount You Need

You can present the financial aid office with a specific amount you need, but before you do that, it’s a good idea to think through a few other factors beyond the numbers you see on your financial aid award. When you review financial aid awards, it’s important to go over each one with a fine-toothed comb.

Each financial aid award will list the financial aid you’ve received, but it’s a good idea to get an idea of the full costs, including tuition, room, board, and fees, before you choose a college. Some fees may not pop up until later, such as lab fees, club organization dues, athletic fees, parking fees, and more. Ask the financial aid office for a comprehensive list of fees that might crop up.

It’s also important to factor in tuition increases. You can ask the financial aid office for the average increase amount.

Note that scholarships usually don’t increase as tuition increases occur, which means that if scholarships don’t change and tuition increases, you’ll be responsible for making a larger tuition payment. Some schools do freeze tuition, so find out more about how that works at the institutions you’re considering attending.

After you’ve done all your homework, you can then decide on a specific amount of money you’d like to see from each financial aid office.

2. Put Everything in Writing

Ask the financial aid department about their financial aid appeal process or consult the website of the financial aid office to find out about the supportive documentation you need to provide to qualify for more financial aid. Following directions may help increase your chances of success.

Write a high-quality financial aid appeal letter to the director of financial aid, using a business letter format, and a formal tone — skip the fancy fonts! Your letter should be as businesslike and respectful as possible, but very direct. Explain how interested in the school you are and identify the forms you’ve submitted.

3. Explain Why You Should Get More Money

It’s important to shore up your desire to obtain more financial aid by demonstrating a need for more financial aid. In other words, you have to have a good reason to need more financial aid — in most cases, you can’t just say you simply want more financial aid. Financial aid offices also will likely not award you more aid just because a parent is unwilling to contribute to education costs or file the FAFSA or if a parent does not claim the student as a dependent.

The institutions you’d like more money from could require you to fill out a special circumstances form, which is a form that shares situations that affect your family’s ability to pay for college. A special circumstances form shares your family’s unique financial circumstances with the institution when you appeal.

The following situations may qualify as special circumstances and could allow you to receive more financial aidIf your family is:

•   supporting multiple households,

•   has experienced a one-time jump in income,

•   has secondary or elementary school expenses,

•   had to make a retirement fund withdrawal for emergency purposes,

•   has funeral expenses or unreimbursed medical and dental expenses, educational debt, a job loss, or has had a significant reduction in income.

Read the instructions carefully to learn how to successfully submit the special circumstances form for your institution.

4. Provide Any Relevant Supporting Documents

When writing your letter and filling out your special circumstances form, you’ll likely need to provide evidence of your family’s situation, which could include:

•   Divorce documentation or decree

•   Court documentation to substantiate a separation

•   Copy of parent marriage certificate

•   Copy of family member death certificate

•   Letter from employer documenting the last date of employment if no longer employed

•   Documentation of year-to-date earnings, unemployment, and/or disability benefits

•   Copies of three most recent paycheck stubs

•   Documentation of termination of child support payments

•   Documentation one-time income or benefits

•   Documentation of medical expenses not covered by insurance for family members

•   Documentation of elementary or secondary school tuition paid

Follow the instructions your school’s financial aid office includes.

5. Follow Up

You may need to allow several weeks for the financial aid appeal to be processed (sometimes four to six weeks), but if you don’t hear back from the financial aid office about a change in your award letter, you may want to reach back out to make sure you’ve submitted all the required documentation. You may have forgotten a critical component of the financial aid appeal, which could hold up a final decision.

Alternatives to Financial Aid

While financial aid can help you get through school, it’s not the only way to pay for college. There are alternatives to relying completely on financial aid to get through school. Consider working while in school, asking relatives for help, and accessing private student loans. Let’s take a look.

Working While in School

Working while in school or on breaks during the summer can help alleviate some of the costs of college. You may not be able to rely on the work-study award to pay for the full cost of college because work-study is limited to a specific number of hours, as determined by your financial aid award.

Finding a part-time job can help pay for a wide variety of college expenses and can offer valuable professional experiences.

Asking Relatives for Help

Relatives may be willing to help you pay for college. When parents, aunts, uncles, grandparents or other relatives chip in, it can alleviate a chunk of college costs, particularly when combined with a part-time job while in school.

It’s a good idea to make sure both you and your relative(s) agree that these types of payments are gifts, not loans. You don’t want to be surprised by a relative that expects repayment as soon as you’re done with school. You may even want to write down the amount of money, terms, and conditions involved, and have both parties agree and sign before you accept any money for college.

Private Student Loans

Private student loans are loans that, unlike federal student loans, do not come from the federal government. Private student loans typically come from private organizations, such as banks, credit unions, and other organizations. You can also check with the college or university you plan to attend for information about private student loans.

Like federal student loans, however, private student loans must be repaid along with interest payments. Repayment terms and benefits vary depending on the lender, and interest rates could be fixed or variable. (All types of federal student loans offer fixed interest rates only.)

Unlike federal student loans, private student loans may not offer the borrower protections afforded to their federal counter parts, so they are generally considered as a last-resort option. Take the time to shop around among several private student lenders before you land on the right one for you. Learn more about private student loans in our private student loans guide.

Explore SoFi’s Private Student Loan Options

If you think you may need to cover some of your college costs with a private student loan, SoFi offers private loans that could help you pay for your education. Explore and compare federal and private loan options, terms, and interest rates to determine the best option for your educational needs.

Worried about rising interest rates? SoFi offers competitive interest rates for qualifying private student loan borrowers.

FAQ

Can you negotiate your financial aid offer?

Yes, you can negotiate your financial aid offer. Check with the college, university, or other postsecondary institution(s) you receive a financial aid award about the process before you attempt to negotiate. The institution may have very specific requirements in order to negotiate your award.

How can I negotiate more money for college?

Requesting more financial aid can be done by following the financial aid appeals process at the college(s) you’re considering. Typically, you can present a letter to the financial aid office, fill out the special circumstances document provided by the institution, and provide supporting documentation. Follow up if you haven’t heard back from the institution between four and six weeks.

How do I ask a college to match the financial aid another school offered me?

If you received two financial aid awards from two colleges, you can use a negotiating college tuition technique by showing the school that offers you less the better aid award from the other school. Doing this may make the most sense if they are similar institutions, such as if they are both private liberal arts colleges or if they are both large state universities. You’re most likely going to get a better response if you compare apples to apples instead of apples to oranges.

Photo credit: iStock/jacoblund

SoFi Loan Products
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.

SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.

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., 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 04/24/2024 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891. (www.nmlsconsumeraccess.org).

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

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

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Apr
17
2023
How Safe Is a Checking Account?

How Safe Is a Checking Account?

By | Budgeting & Goals, Financial Independence, money | Comments Off on How Safe Is a Checking Account?

In light of recent events, some bank customers may wonder how safe a checking account is in terms of stashing their cash.

Banks are far better for protecting your hard-earned cash than you keeping a wad of bills hidden somewhere in your home — mainly because the money you deposit in a bank is insured up to $250,000 or possibly more1.

But there’s more to the story. So read on, and we’ll tell you in detail how banks make sure your money is well defended — and what you can do to help keep those dollars safe.

Is My Money Safer at a Bank?

It’s only natural to wonder where your money is safest, and keeping your cash on deposit at a bank is one of the safest things you can do. For one thing, carrying cash with you — or, worse, hiding it in your house — leaves you vulnerable to theft or loss (or some other unforeseen event).

In addition, banks are highly regulated and, as mentioned, deposits are insured. And as many people now know, the government is fully invested in protecting the cash of its citizens.

Why Your Money Is Safer in the Bank

Here are some of the protections your checking account may have:

•   FDIC insurance

•   NCUA insurance

•   Capital requirements

•   Protection from fires, floods, and thefts

Read on for a brief description of these protections.

FDIC Insurance

The Federal Deposit Insurance Corporation (FDIC) protects people who deposit money into FDIC-insured financial institutions against loss. This kind of insurance is backed by the federal government and depositors are automatically insured, generally up to $250,000 per depositor, per FDIC-insured institution, per ownership category. (Some banks participate in programs that extend the FDIC insurance to cover millions.) If your bank were to go out of business, you’re covered up to the cap.

NCUA Insurance

Maybe you’re the kind of person who prefers to keep your cash at a credit union. Don’t worry; it’s still safe. Congress created the National Credit Union Administration (NCUA) in 1970 to insure deposits of up to $250,000 at federally insured credit unions. The $250,000 is for each member, per insured credit union, per ownership category. Basically, NCUA is an agency that provides coverage for credit union members that’s comparable to what FDIC does for bank customers.

Capital Requirements

Banks and other financial institutions that accept deposits must have enough liquid assets to cover their expenses while still being able to provide cash when depositors request withdrawals. Formulas to calculate capital requirements can be complicated, but know that they are in place and are protecting you.

A financial institution is required to have a risk-to-asset ratio of at least 4% to safeguard people who deposit funds into their institution.

Protections From Fires, Floods, and Thefts

Banks purchase banker blanket bonds, which protect the institution in case of fire, flood, robbery, embezzlement, earthquakes, and other causes of lost funds. As a result, even if the bank loses money, customers won’t lose their funds.

Get up to $300 when you bank with SoFi.

No account or overdraft fees. No minimum balance.

Up to 3.80% APY on savings balances.

Up to 2-day-early paycheck.

Up to $3M of additional
FDIC insurance.


Advantages of Keeping Money in a Checking Account

Now, let’s pull back and take a big-picture look at why a checking account is such a sweet spot for protecting your money. Some of the pluses:

•   Your money is covered from loss when deposited in an FDIC-insured bank or an NCUA-insured credit union.

•   If your funds exceed the amount of these significant coverages ($250,000), then you can simply open accounts at an institution that offers an insurance program with a higher amount. Or you might open additional accounts at other insured banks and be covered through those institutions.

•   Interest-bearing checking accounts (though not all checking accounts do pay interest) allow you to earn money simply by keeping it in the account.

•   You can easily use your deposited funds by writing a check, withdrawing money from the bank or by an ATM, or transferring it.

•   Checking accounts that come with debit cards make it simple to make purchases through a card reader in person or by entering data online. (Note: There are cons of using a debit card online, like less fraud and purchase protection.)

•   Mobile banking makes it easy to conduct financial transactions wherever you go. You may be wondering, Is mobile banking safe? The answer is yes, most of the time, but you do need to take some precautions to avoid potential hacking activity (more on that below).

•   You can have your paycheck automatically/directly deposited into your checking account. This eliminates a paper check that could get lost or stolen; plus, you don’t have to physically deposit it yourself on payday.

•   A checking account can provide a record of what you spent — and when and where — which is helpful with budgeting, at tax time, and more.

•   Some banks allow you to get paid up to two days early — meaning that your direct deposit is available 48 hours before it’s actually deposited.

Your Role in Protecting Your Money in the Bank

You’ve learned about how banks safeguard your deposits…but what about your role in protecting your money? Yes, even when your dinero is locked up tight at a bank, your actions can impact its security. Consider the following points:

•   If you have any reason to believe that fraudulent activity is occurring or has occurred with your checking account, contact your bank immediately as well as local law enforcement.

•   Create a unique password for your checking account; consider storing it in a secure password management system. Then regularly change your password.

•   Regularly check your balance and balance your statements. This way, you can spot suspicious-looking activity early and address any discrepancies. Identity theft is not unusual and a proactive approach is the best way to protect yourself.

•   Be especially careful when using public Wi-Fi at libraries, coffee shops, and the like. While they’re convenient for information gathering, when you’re conducting financial transactions on them, the open connection makes it easier for hackers to do bad things.

•   Keep your own computer up to date, installing appropriate software updates, malware blockers, and so forth.

•   Sign up for fraud alerts with your bank. Receiving real-time transaction info through texts, emails, or mobile apps allows you to quickly respond to any attempts at fraud.

•   Also, don’t share your banking information with anyone by phone or email. For example, if someone claims to be a representative from your financial institute, hang up. Then use the contact information you have for your bank and share what happened.

The Takeaway

So, how safe are checking accounts? At insured institutions, depositors enjoy deep levels of protection. Besides being safe, there are numerous advantages to having a checking account. Definitely a win-win versus hiding your bucks somewhere at home. But depositing your funds is just part of the bargain: Then you have to do your share and keep vigilant and make sure that fraudsters don’t get their fingers on your dough.

If you’re looking for a bank that protects your money with 24/7 account monitoring, apply for an online bank account with SoFi. SoFi recently announced that deposits may be insured up to $2 million through participation in the SoFi Insured Deposit Program. But here’s what else: If you sign up for direct deposit with us, you’ll earn a competitive APY. Plus, you’ll pay no account fees, and you’ll be able to access your paycheck up to two days early.

Better banking is here with  up to 3.80% APY on SoFi Checking and Savings.

FAQ

Is your money safe in a checking account?

Yes, your money is safe in a checking account. Federally insured banks and credit unions automatically protect depositors like you for up to $250,000 per person, per insured institution, per ownership category (or possibly more). These financial institutions are even covered in case of fire, flood, and earthquakes, as well as when crimes, such as robbery and embezzlement, occur.

What are the risks of a checking account?

Checking accounts come with plenty of benefits and, at federally insured financial institutions, with solid protection against risk. That said, there are a couple of potential disadvantages to checking accounts. For example, not all of them pay interest (although some do). Some come with monthly fees (which can get pricey). And some financial institutions will require a minimum balance in your account.

There’s also some risk of criminal activity: If you ever suspect that someone has hacked into or otherwise fraudulently used your checking account, contact your bank and local law enforcement.

Can someone steal your checking account?

Physical checks and debit cards can be stolen, and your account could be hacked. So keep all personal data in a secure place and, if any items are lost, contact your financial institution immediately. If you believe your checks or debit card to be stolen, also inform your local law enforcement.

Photo credit: iStock/akinbostanci

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

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2025 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.

SoFi members with direct deposit activity can earn 3.80% 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 3.80% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant. SoFi members with Qualifying Deposits are not eligible for other SoFi Plus benefits.

SoFi Bank shall, in its sole discretion, assess each account holder’s 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 3.80% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have 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.

Separately, SoFi members who enroll in SoFi Plus by paying the SoFi Plus Subscription Fee every 30 days can also earn 3.80% APY on savings balances (including Vaults) and 0.50% APY on checking balances. For additional details, see the SoFi Plus Terms and Conditions at https://www.sofi.com/terms-of-use/#plus.

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

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Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. To qualify, a borrower must be a U.S. citizen or other eligible status, be residing in the U.S., and meet SoFi's underwriting requirements. Not all borrowers receive the lowest rate. Lowest rates reserved for the most creditworthy borrowers. If approved, your actual rate will be within the range of rates at the time of application and will depend on a variety of factors, including term of loan, evaluation of your creditworthiness, income, and other factors. If SoFi is unable to offer you a loan but matches you for a loan with a participating bank, then your rate may be outside the range of rates listed above. Rates and Terms are subject to change at any time without notice. SoFi Personal Loans can be used for any lawful personal, family, or household purposes and may not be used for post-secondary education expenses. Minimum loan amount is $5,000. The average of SoFi Personal Loans funded in 2023 was around $33K. Information current as of 2/26/24. SoFi Personal Loans originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org). See SoFi.com/legal for state-specific license details. See SoFi.com/eligibility for details and state restrictions.

✝ 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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