SoFi

Your personal finances can be an important but challenging aspect of your life to manage. Even if you are brilliant at math, computing things like the payoff amount on student loans or the optimal goal for retirement savings can be complicated.

That’s where financial calculators can swoop in and help you. These tools can make it simple to see how much you are spending in, say, credit card interest or what a mortgage payment might look like on your dream house.

Here’s a resource with a variety of financial calculators. Read on to learn what kind of assistance is out there to help you take control of your money and your goals.

1. Student Loan Calculator

There are plenty of student loan calculators out there that can help you estimate your monthly payment and total interest cost.

In addition, you are likely to find student loan refinancing calculators to get a basic idea of how refinancing might affect your bottom line.

Typically, you enter your current loan information, then adjust the term “slider” to see how your monthly payment and total savings amount could be impacted by refinancing.

You could see valuable information like how much you might be able to save every month by refinancing or how much you could potentially save over the lifetime of a loan if you were to refinance. (Calculated payments and savings are only estimates, and don’t factor in your current credit picture or financial situation.)

Just keep in mind that refinancing isn’t necessarily the right choice for everyone. If you have federal student loans and refinance, you will forfeit federal protections and benefits. Also, if you refinance for an extended term, you may pay more interest over the life of the loan.


💡 Quick Tip: A low-interest personal loan from SoFi can help you consolidate your debts, lower your monthly payments, and get you out of debt sooner.

2. Retirement Calculator

It’s almost impossible for one online retirement calculator to take into account all the variables that retirement planning requires. But a calculator could still be useful to give you a general idea of how much money you may want to be saving and how big your retirement nest egg could grow.

It might also give you some insight into how much you’re contributing now, and if you might want to think about adjusting your IRA (individual retirement account), 401(k), or other retirement investment.

One online tool that may be helpful is AARP’s Retirement Calculator . It asks for quite a bit of information, including information about your age, income, current savings and lifestyle expectations in retirement (i.e., will you need more, less, or the same amount of money as you now spend).

The calculator then gives an estimate of how much wealth you’re likely to accumulate and changes you could make — like working longer or saving more — that might help improve your outcomes. Understanding when to retire and what your expenses will be like at that life stage can be an important part of your future planning.

3. Budgeting Calculator

Making a budget — and sticking to it — is one important step on the road to financial security. By making a budget and sticking to it, you might be able to save some extra cash and even be able to gain some new insight and understanding about how you’re currently spending your money.

Setting up a budget might have a snowball effect, potentially empowering you to save even more money once you have a holistic view of current spending. By tracking your finances with a budgeting tool, you can get a better sense of how your earnings, spending, and savings are tracking. It can also help you course-correct if, say, you get hit with a big unexpected bill or move to an area with a different cost of living.

4. & 5. Credit Card Debt Payoff Calculator

Various tools can be helpful if you’re focused on paying down some credit card debt.

•   You might want to use this debt snowball calculator to figure out how long it could take you to completely pay down your balance. In this method, you eliminate your smallest debt first, which can build your motivation. You may want to see how increasing your monthly payments could affect your debt and help you save on interest, which might help keep you motivated in your payoff goals.

You could also use a calculator to see how much faster you could pay off your debt with the debt avalanche method. With this technique, you go after your highest interest-rate debt first.

•   Additionally, to take a look at debt in terms of your credit card interest rate, you might spend some time using a credit card interest calculator. Since credit card debt can be one of the most challenging debts to pay off, you might want to understand how much you are paying overall.

This kind of calculator shows roughly how much interest you could end up paying on your credit card debt. It can give a broad estimate of when that debt could be paid off in full if you continue to make the same payments. Equipped with that information, you might decide to opt for a different way to pay down your debt, such as looking for a lower-interest personal loan.

6. Student Loan Payoff Calculator

If you’re budgeting for your student loans, you could try working with a student loan payoff calculator. Simply add your basic information, and it calculates when your estimated payoff date could be. Plus, you can often click through and discover additional information and tips you could use to potentially shorten that payoff period.

Some of these ideas might include things like seeing if you can find a lower interest rate or making additional payments. Plugging these two data points into the calculator might give you a basic estimate of how much sooner you could pay off your loans.

7. Housing Costs Calculator

Is your attention focused on buying a home? Are you all about mood boards for the primary bedroom and vegetable garden you’ll plant? Then you’re in the right place.

A home affordability calculator can help you look at how much house you can afford. It will help you factor in such considerations mortgage amount, interest rate, property taxes, and so forth. It can be a great way to get a handle on just how much homeownership might cost you.

Additionally, a mortgage calculator can help you get a sense of how much you can save on your monthly payment by changing your down payment. This intel can help you decide whether to start bidding soon or wait until you have a bigger chunk of cash to put down.

These tools can help you decide whether to rent or buy in the near future, as well as (when buying) how to determine the right balance of down payment and financing to suit your budget.

Get Started on Your Goals With These Tools

Your goals are probably pretty unique to you and where you’re at career-wise, with money, and maybe even with outstanding loans. So there’s probably not one end-all, be-all financial calculator to help you achieve all of your financial goals. But there are an array of tools that can help you track your money and determine good options as you move forward.

As you evaluate where your finances stand, you may want to consider ways to pay down debt, such as using a personal loan to eliminate high-interest debt and lower your monthly outlay of funds.

Think twice before turning to high-interest credit cards. Consider a SoFi personal loan instead. SoFi offers competitive fixed rates and same-day funding. See your rate in minutes.

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.

Most of us have debt, whether that means a student loan, a car loan, a credit card balance, or a combination of these. Although there are plenty of good reasons to take on debt, such as affording your education, buying wheels to get to work, and charging clothes to wear on the job, face it: Debt has a way of piling up, and that interest can keep ticking northward.

To deal with debt, it’s wise to be proactive about paying it off. Luckily, there are plenty of great resources and techniques to help you create your debt payoff plan — but only you will know what’s best for your unique financial situation.

While none of this is meant to replace financial advice from a professional, here are a few tips to consider. They can offer solid advice on techniques to help crush your debt.

Customize Your Debt Payoff Plan Approach

The words “snowball” and “avalanche” might sound like an increasingly alarming day on the mountain, but they also apply to three popular debt payoff methods, one of which may be just right for you.

•   The snowball method entails paying off your debts in order from smallest to largest, regardless of their respective interest rates. By getting that smallest debt paid off quickly, you may well feel a surge of motivation to keep on going with your debt repayment plan.

But people using the debt snowball method, beware: Ignoring interest rates usually means paying more money in the long run.

•   If savings is your main priority, you’ll probably want to look at the avalanche method, which has you putting more money toward your higher-interest rate debt first. Not only does this avalanche method save you money, it can also help you get debt-free sooner.

💡 Quick Tip: Before choosing a personal loan, ask about the lender’s fees: origination, prepayment, late fees, etc. One question can save you many dollars.

Try a Debt Detox

People often compare getting fiscally fit with getting physically fit, and with good reason. Whether you’re trying to achieve financial goals or health and fitness goals, you’re more likely to succeed if you have a good plan in place, a fair amount of willpower, and a desire to change your habits.

You might try what’s known as a spending fast, and only buy necessities for a month or two (or longer) and see how much you can save. The funds you accrue can go towards your debt. Seeing that debt shrink can inspire you to keep going.

Or you might try a technique such as only using your debit card or cash, to help you avoid more high-interest credit card debt.

Amp up the Minimum

Another approach for a debt payoff plan is to pay more than the minimum payment each month. Whether you have student loans or credit card debt, paying more than the minimum can help accelerate your debt payoff journey.

It can be tempting to just stick with paying the minimum balance due rather than adding to it. But paying as much as you can each month (without stretching yourself too thin) can add up. In order to make this happen, however, you may have to make a few sacrifices.

Making coffee at home, cooking for yourself, or exercising outside instead of paying for a pricey gym membership are all small changes that can help save extra money each month to put toward your debt.

By increasing how much is allocated toward monthly payments, you could pay off your debt faster and therefore save on interest. And who wouldn’t want to be out of debt sooner?

Consider a Balance Transfer

Balance transfer credit cards sometimes offer low or 0% introductory annual percentage rate, or APR, periods for high-interest credit card debt transfers. Typically, you may enjoy 18 months of 0% interest, which can help keep you from accumulating even more debt via interest.

Reasons people apply for a balance transfer credit card include:

•   Having high-interest credit card debt

•   A desire to simplify payments on one card, rather than managing payments on multiple credit cards

•   Wanting to take advantage of a good promotional deal (for example, up to months of 0% interest).

But it is important to remember that this debt payoff strategy is optimal if you know you can pay off your entire debt by the time the low- or no-interest period ends. Otherwise, you will go back to accruing interest on your debt after the introductory period ends.

A credit card interest calculator can help you discover how much you are paying in interest alone on your credit card debt. This can help you evaluate how much you might save.

Recalibrate Your Rate

High-interest rate debt is not only expensive, it can also take forever to pay off. But just because your loan or credit card came with a rate that’s higher than you’d like doesn’t necessarily mean you’re stuck with it forever.

•   For one thing, if you have student loans, student loan refinancing is one option. When you refinance your student loans with a private lender, you are taking out a completely new loan with a new interest rate.

You can refinance both private and federal student loans with a private lender, but understand that if you refinance federal loans you will lose access to all federal benefits like deferment, income-driven repayment plans, and public service loan forgiveness programs. In addition, if you opt for a loan with an extended term, you may pay more interest over the life of the loan, so think carefully about whether it’s the right move for you.

If you have an improved financial profile from when you took out your original loan, however, you may be able to qualify for a lower interest rate. By obtaining a lower interest rate, you could save money over the life of the loan. Or you may be able to select a shorter term with higher payments but a quicker payoff — and save money on interest payments.

•   If you have high-interest credit cards, you can look into consolidating them with a low-interest rate unsecured personal loan. One plus of taking out a personal loan to consolidate your debt is that personal loans are typically installment loans, which means they have a fixed repayment period. That means you’ll know exactly when your loan will be paid off.

In contrast, credit card debt is “revolving debt,” which means you can continuously add to the debt even while paying it off. That’s not an option with a personal loan. By consolidating your credit card debt with a personal loan, you could also potentially qualify for a lower interest rate, which can make your debt easier to manage.

On the flip side, a personal loan may not be right for everyone. Some personal loans come with origination fees, late fees, or prepayment penalties, which could potentially drive up the cost of your loan. When shopping around for debt payoff solutions, you may want to consider any hidden fees that could come with a personal loan.

No matter what debt payoff plan you choose, the key is to take control of your debt rather than letting it control you. Ultimately, executing a successful debt payoff strategy might help you focus on the positive outcomes that happened as a result of your debt rather than the frustration of having to pay it back.

The Takeaway

Debt, especially when it’s the high-interest variety, can be hard to pay off. By trying such tactics as budgeting, reducing spending, and considering balance transfer credit cards and loan financing, you can likely get on a path to lowering and then eliminating your debt.

Think twice before turning to high-interest credit cards. Consider a SoFi personal loan instead. SoFi offers competitive fixed rates and same-day funding. See your rate in minutes.

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.

SOPL1223022

Student loans are mounting for college and graduate students, with engineering majors being no exception. In fact, for the 2020-21 school year, 54% of bachelor’s degree holders left school with student loans—with a debt level of $29,100, on average. Nationally, Americans have $1.6 trillion in student debt combined. Given that engineering is the fourth most common major, many of those shouldering student debt are engineering students.

Since careers in engineering can come with salaries well into the six-figures, some students might consider taking on student loans in order to follow all the way through to a master’s degree in that area. But getting there isn’t cheap. The typical engineering grad school student can expect to spend upwards of $50,000 or more for their masters degree. And that doesn’t include possible balances carried over from their undergrad years. The average student debt for engineering undergrad students varies, but when you factor in graduate school and undergraduate debt, that could mean a substantial amount of student debt.

If you’re studying to be an engineer, you may assume there aren’t many loan assistance programs out there for you, and it’s true that there are no federal forgiveness programs specifically for engineers. But you do have options to save money on your loans, whether through public service loan forgiveness, income-driven repayment plans, state programs aimed at professionals in your field, or student loan refinancing. Here, you can learn about some of the opportunities that exist.

Federal Loan Repayment Options

It’s true that many engineering majors go on to lucrative careers. But that doesn’t mean you necessarily earn a high salary right away. And you may choose to apply your skills at a government agency or nonprofit, or work in a different field altogether, earning less than expected.

The federal government offers four different repayment plans that cap your monthly payments at a percentage of your income in order to make your student loans affordable. Once you make the minimum number of payments required, the balance on your loans is eligible to be forgiven. Which plans you’re eligible for will depend on the types of federal student loans you have and when you borrowed them:

•  The Saving on a Valuable Education (SAVE) Plan was created to replace REPAYE. Payments on SAVE are capped at 10% of your discretionary income (in July 2024, that threshold will be 5% for undergraduate loans). Certain borrowers will have their balances forgiven after 10 years, while others will need to make payments for up to 20-25 years before receiving forgiveness. Only Direct Loans are eligible, excluding Direct PLUS loans to parents.

•  The Pay As You Earn (PAYE) plan also limits payments to 10% of your discretionary income. The balance can be forgiven after 20 years of payments. Again, only Direct Loans are eligible, except Direct PLUS loans to parents.

•  Under the Income-Based Repayment Plan (IBR Plan), your payments are limited to 10% of your discretionary income if you borrowed on or after July 1, 2014, or 15% if you borrowed before that date. In the former case, the debt can be forgiven after 20 years; in the latter, it can be wiped away after 25 years. Direct Loans are eligible (except Direct PLUS loans to parents), as well as most loans under the earlier Federal Family Education Loan Program.

•  The Income-Contingent Repayment Plan (ICR Plan) limits payments to 20% of discretionary income in most cases, and the rest can be forgiven after 25 years. Only Direct Loans are eligible, but this is the only program that also allows Direct PLUS loans to parents to qualify, as long as they are consolidated into a Direct Consolidation Loan.

If you aren’t sure which plan is best for you, ask your loan servicer for guidance. You can apply to enroll in an IDR program by filling out an Income-Driven Repayment Plan Request online or by asking your loan servicer for a paper form.

Taking advantage of programs that base your payment on your income can potentially make your monthly payment affordable in the long term if you don’t expect your salary to go up much.

Note: the amount forgiven under an income-driven repayment plan may be considered taxable income.


💡 Quick Tip: Ready to refinance your student loan? With SoFi’s no-fee loans, you could save thousands.

Public Service Loan Forgiveness

There’s another way to take advantage of student loan forgiveness for engineers. If you work full-time for a government agency, non-profit, or certain other employers that serve the public interest, your federal loans might qualify for Public Service Loan Forgiveness. Those organizations include the military, as well as public safety, emergency management, and public health groups.

Under this program, once you make 120 qualifying payments (the equivalent of 10 years), the balance on your loans can be eligible for forgiveness. Make sure to submit an Employment Certification form annually or when you switch jobs. Note that only Direct Loans qualify for the program.

If you have older loans, you may be able to make them eligible by consolidating them through a Direct Consolidation Loan. You need to be enrolled in an income-driven repayment plan if you want to apply for Public Service Loan Forgiveness.

State Loan Assistance Programs for Engineers

Engineering is an in-demand profession. The U.S. Bureau of Labor Statistics estimates that 140,000 new engineering jobs will be created between 2016 and 2026. The fastest growing sub-specialties are civil, mechanical, and industrial engineering.

With this in mind, a couple of states have created programs that provide student loan assistance to people in the Science, Technology, Engineering, and Math (STEM) fields as incentive for professionals to reside there and pursue jobs in these areas.

For example, the Rhode Island Wavemaker Fellowship provides funds to college graduates who are pursuing a STEM-related career or starting a business in Rhode Island. Qualifying individuals receive a refundable tax credit certificate worth the value of their annual student loan burden for up to four years. Fellows are also invited to participate in various personal and professional programs and events.

The New Jersey STEM Loan Redemption Program incentivizes professionals to build careers in certain high-growth STEM fields in New Jersey. Program participants receive up to $2,000 to cover eligible student loan expenses each year, for up to four years, up to a maximum of $8,000. Half of each payment is funded by the New Jersey Higher Education Student Assistance Authority (HESAA), and the balance is matched by an equal contribution from the participant’s current employer.

When looking for student loan relief, steer clear of any scams promising fast, easy solutions at a hefty cost. Many of these companies end up filling out paperwork you could’ve completed yourself for free, or providing no services. Focus on official programs administered by federal or state governments, or by legitimate foundations or employers.


💡 Quick Tip: When refinancing a student loan, you may shorten or extend the loan term. Shortening your loan term may result in higher monthly payments but significantly less total interest paid. A longer loan term typically results in lower monthly payments but more total interest paid.

Look to Your Employer

With employers looking to retain talent, some companies offer loan assistance for engineers. For example, PriceWaterhouseCoopers, the professional services firm, pays $1,200 in student loans for associates and senior associates, for up to six years. Its employees include software engineers, data engineers, cloud security engineers, DevOps engineers, and more.

Abbott, a health technology company, assists with student loans in a slightly more indirect way. For full-time and part-time workers who qualify for the company’s 401(k) plan, and who are paying at least 2% of their salary toward student loans, the company will deposit its 5% match in the 401(k) plan even if the employee doesn’t contribute anything.

This way, it helps employees avoid the tradeoff between paying off loans and saving for retirement. Abbott hires for roles like engineering director, senior manufacturing process engineer, mechanical engineer, and more.

These are just a few examples of companies that offer loan repayment help to engineers. It’s worth keeping a lookout for this benefit throughout your job search.

The Benefits of Student Loan Refinancing

The above options may not be enough: Perhaps you don’t live in the right place or work for the right employer, or maybe you earn too much for an income based plan to make sense. If you don’t qualify for loan assistance, or even if you do have some benefits but not all of your loans are covered, refinancing your student loans can be a good way to potentially save money.

You can refinance federal loans or private loans with a variety of lenders and other financial institutions, often nabbing a lower interest rate or reduced monthly payment in the process. (You may pay more interest over the life of the loan if you refinance with an extended term.) And you may get a better rate if you have a good credit score, earn a decent income, and have a solid employment history. It takes just a couple of minutes to see if you pre-qualify online.

Engineer a Better Future

Student loans represent an investment in a solid career path, but they can be a burden even for people in thriving professions. If you’re an engineer, check out what options are available to reduce your student loans, whether that’s loan forgiveness, assistance from your state or employer, or student loan refinancing.

Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.

SoFi Student Loan Refinance
Terms and conditions apply. SoFi Refinance Student Loans are private loans. When you refinance federal loans with a SoFi loan, YOU FORFEIT YOUR ELIGIBILITY FOR ALL FEDERAL LOAN BENEFITS, including all flexible federal repayment and forgiveness options that are or may become available to federal student loan borrowers including, but not limited to: Public Service Loan Forgiveness (PSLF), Income-Based Repayment, Income-Contingent Repayment, extended repayment plans, PAYE or SAVE. Lowest rates reserved for the most creditworthy borrowers. Learn more at SoFi.com/eligibility. SoFi Refinance Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

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.

SOSL0823015

Moving is part of most people’s lives. Maybe you’re heading to grad school a couple of towns away. Or perhaps you have a job offer hundreds of miles away that you’re excited to accept.

Whatever the reason, the logistics of getting your stuff from the old place to the new one will need wrangling. Here, you’ll learn more about your options for moving, how much it may cost (from a couple of hundred dollars to thousands), and how to afford the expense.

DIY Moving Costs

Yes, you could move yourself. This could be a smart move for a small, local move, and it can help keep costs within your budget.

Exactly how much this might cost will be based on several factors:

•   Cost of transportation (can you borrow a friend’s van or do you need to rent one)?

•   Cost of the packing materials you use (recycled boxes and old newspapers vs. the pros’ higher-end and job-specific supplies

•   How much stuff you’re moving (and if you need to figure out insurance for any pricey items)

•   How far you’re going

•   Whether you need to store some things temporarily.

As you might guess, packing up the contents of a dorm room and moving it half a mile away to the apartment you’re renting with friends will cost one amount. Supplies might cost, say, $65.

Loading up the contents of the sweet bungalow you’ve been living in for a couple of years and depositing your worldly possessions at a new place 1,000 miles away will be a much more involved and expensive undertaking. Packing materials alone could be a few or several hundred dollars, and renting a moving truck could be anywhere from $20 to $100 per day, depending on your local cost of living. Also, you will likely have to pay to stay somewhere overnight and also spend at least a couple of hundred dollars on gas, dollies, and insurance.


💡 Quick Tip: Some personal loan lenders can release your funds as quickly as the same day your loan is approved.

Full Service Moving Costs

If you decide a full-service move best meets your needs, you’re probably going to want to gather some estimates, so you can nail down the details and be ready when it’s time to go. Some pointers as you do so:

•   Also, do check ratings and references carefully. There are plenty of instances of fraud and scams in this realm, and it’s wise to protect yourself.

•   Booking your truck four to eight weeks in advance is typically a good rule of thumb — maybe even further out if you’re moving in the busy summer months.

•   Professional moving companies can give you an estimate based largely on how many rooms of furniture you have. Most have websites, so you can often get a quick estimate online. A typical local (or fairly local, not long-haul) move for a three-bedroom home is about $2,100.

The average moving costs if you relocate cross-country can easily be twice that, or $4,300 for a distance of about 1,225 miles. Keep in mind, specifics will vary. Oversized or extremely heavy items might cost you extra — as could lots of stairs, or things that need to be taken apart and put back together.

Recommended: Average Personal Loan Rates

Extra Moving Costs to Think About

Then there are the extras that go along with getting out of one place and into another.

•   Transportation: If you’re taking your car across the country, you’ll probably want to get a tune-up before you go. And then there’s gas, hotel stays, and eating on the road. Having a car transported instead of driving it yourself could cost anywhere from $700 to $2,000.

If you’re in a hurry and decide to fly, that’s another expense. And if you’re taking a pet, you may have to add a little bit more to your overall bill, depending on the mode of transportation you choose for your furry friend.

•   Getting into your new home: Don’t forget about deposits you might have to make at your new location. That could be anything from first and last month’s rent and a pet deposit at a new apartment, to utility deposits at a new house.

•   Home repairs and cleaning: Be ready to pay for some home repairs on both ends of your move. You may have to make some quick fixes to get out of your rental without losing the deposit or maybe even major repairs if you’re selling a home. When you get to your new location, you could find some unexpected problems. Or you may just want to hire someone to come in and clean so you can cross that off your ever-growing moving to-do list.

•   Starting out fresh: You’ll probably need to buy some things at your new home (like curtains, curtain rods, hangers, bedding, etc.) that are easily overlooked. Then there’s that fridge to fill. All those little costs can add up.

•   Cash for tips: You will likely need to withdraw money from an ATM to thank people for their help when you move. Tips for the movers. Tips for the handyman or housekeeper who helps you get things in shape. Tips at your hotel. Tips for waitstaff at the restaurants you’ll be eating at until you get your new place up and running—or at the very least, tips for the pizza delivery guy.

Recommended: Typical Personal Loan Requirements Needed for Approval

Financing Your Move

If you have enough room on multiple credit cards, you could go that route, but should you? Interest rates can be considerable.

Or would a personal loan make more sense for you to cover all those costs, big and small?

Remember, even if you’ll be reimbursed by your employer or plan to take some moving deductions when you file your tax return, it’s very likely you’ll be paying at least some moving costs up front. And the longer those expenses sit on a credit card, the more interest racks up.

The Takeaway

Even if you have a small amount of stuff and aren’t moving very far, moving takes time, energy, organization, and money. With the average professional move costing a couple of thousand dollars, you may want to plan carefully for this expense. It’s likely not a good reason to dip into your emergency fund, so you may want to save in advance or consider a personal loan. If you qualify for a personal loan, your interest rate may be lower than a credit card, which can free up some cash and reduce your money stress.

Think twice before turning to high-interest credit cards. Consider a SoFi personal loan instead. SoFi offers competitive fixed rates and same-day funding. See your rate in minutes.

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.

SOPL1223011

Most Americans swipe and tap their way through the day, using credit cards for a variety of purchases. Plastic is quick and convenient, and it can help a person make purchases they otherwise wouldn’t be able to afford in a single transaction.

But with credit cards come high interest rates…and fees. Often, many different kinds of fees are levied on a single transaction.These charges may be part of the reason why there’s so much credit card debt right now. The average American carries an approximate credit card balance of $7,951.

If you’re trying to control your costs, read on to learn more about these fees, plus smart tips on how to dodge them. It can be a good path to taking control of your credit and your cash.

Breaking Down the 6 Main Credit Card Fees

The best way to sidestep credit card fees is to know what they are. Sounds obvious, but it can be your primary defense in the battle against fees. Here’s a summary of some of the most common credit card fees and advice on how to avoid them.

1. Annual Fees

An annual fee is the yearly price you pay to use a credit card. Not all credit cards have annual fees, but many reward-heavy and premium cards do. It’s not inherently bad to pay an annual fee on a credit card, but it does require busting out a calculator and doing some math. To justify paying an annual credit card fee, you should earn enough in rewards to cover the fee and then some.

How to avoid this fee: Lots of cards have no annual fee or will waive an annual fee in the first year. When choosing a credit card, you’ll want to do some comparison shopping and annual fees should be something you pay close attention to. Ultimately, if you’re going to pay a fee for using a rewards card, you should make sure you’ll be cashing in on rewards you’ll actually use.


💡 Quick Tip: Before choosing a personal loan, ask about the lender’s fees: origination, prepayment, late fees, etc. SoFi personal loans come with no-fee options, and no surprises.

2. Late Payment Fees

Late payment fees are pretty self-explanatory. Basically, some banks will ding you if you miss a payment. Currently, late payment fees can run up to $41, but there’s a movement afoot to cap these. The Consumer Financial Protection Bureau, for instance, has proposed a limit of $8. But for the time being, these fees are still quite steep.

There are other consequences of late payments worth noting. Your interest rate could go up, for instance.

How to avoid this fee: Consider automating your finances. Specifically, you could set up an automatic payment for at least the minimum monthly payment. That way, you are in a good position to avoid late fees.

If you do miss a payment, call your credit card company and ask them to waive the fee. (If you’re a first-time offender, they might be amenable to it.)

3. Cash Advance Fees

When you use a credit card to withdraw cash from a bank or ATM, you will almost always be charged a cash advance fee. Credit card cash advance fees generally cost 5% of the amount you withdraw or $10, whichever is higher. Also be aware the interest rate on a cash advance is likely to be higher than on “normal” credit card purchases, and interest accrues immediately.

How to avoid this fee: Don’t use your credit card like a debit card. If you’re going to take out cash, it should be with a debit card. If you do have to take out a cash advance on your credit card, try to pay it back as soon as possible. And to avoid needing to take out a cash advance in the future, establish a cash emergency fund that’s easily accessible.

Recommended: Credit Card Interest Rate Calculator

4. Balance Transfer Fees

When you transfer a credit card balance to a new card with a lower interest rate (often 0% interest for a promotional period of, say, 18 months), the new credit card issuer may charge you a fee. The fee is usually 3% to 5% of the balance being transferred. Balance transfer cards usually offer 0% interest rates to new customers who want to transfer their credit card debt — so charging a fee allows them to make some money on the initial transaction.

How to avoid this fee: If a balance transfer card would stress you out with its tight timeline before its interest rates change, you could instead consider taking out a personal loan to pay off your credit card debt. A personal loan will usually charge a lower interest rate than your credit card, but it can allow you to pay off your debt on a timeline that’s right for you.


💡 Quick Tip: Swap high-interest debt for a lower-interest loan, and save money on your monthly payments. Find out why credit card consolidation loans are so popular.

5. Foreign Transaction Fees

If you use a credit card while traveling outside of the country, you may be charged a foreign transaction fee of around 1% to 3%. Once very common, these fees are declining in popularity thanks to the rise of cards with no foreign transaction fees.

Also know that banks may charge currency conversion fees in addition to foreign transaction fees.

How to avoid this fee: Choose a card that doesn’t charge foreign transaction fees. There are lots of options out there, it’s just a matter of shopping around. Airline cards often don’t have foreign transaction fees, but plenty of other cards have dropped these fees as well.

You may also be able to use a debit card in a foreign country.

6. Interest

Interest is how credit card issuers stay in business, to a large extent. They are extending you credit to make a purchase, and interest is what you pay for that privilege. Credit card issuers assess interest on any balance that remains on your card after the due date. You will also see this interest rate called the purchase APR.

How to avoid this fee: Pay off your credit card balance in full each month. If you’re unable to do that, pay as much as you can — every dollar counts.

Recommended: Taking Out a Personal Loan to Pay Off Credit Card Debt

The Takeaway

Credit cards can be a convenient way to purchase, and most Americans use them. However, these cards can also charge fees that can add to any debt you carry. It’s worthwhile to acquaint yourself with these fees and work to avoid them so your balance doesn’t grow.

If you’re currently chipping away at a balance, you may want to consider taking out a personal loan to pay off your credit card. This can lower your rate of interest and make your debt less of a burden.

Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.

SoFi Student Loan Refinance
Terms and conditions apply. SoFi Refinance Student Loans are private loans. When you refinance federal loans with a SoFi loan, YOU FORFEIT YOUR ELIGIBILITY FOR ALL FEDERAL LOAN BENEFITS, including all flexible federal repayment and forgiveness options that are or may become available to federal student loan borrowers including, but not limited to: Public Service Loan Forgiveness (PSLF), Income-Based Repayment, Income-Contingent Repayment, extended repayment plans, PAYE or SAVE. Lowest rates reserved for the most creditworthy borrowers. Learn more at SoFi.com/eligibility. SoFi Refinance Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

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.