SoFi

How America shops is shifting in a fundamental way.

Shoppers are turning to discount stores such as Dollar Tree, ALDI, and Big Lots more often, driven largely by spiking inflation, which peaked at 9.1% in June 2022. These days, shoppers are increasingly asking themselves, Why pay more? as they place a higher premium on value.

According to SoFi’s Discount Shopping Survey of 1,500 consumers fielded in August 2023, 81% of respondents are currently shopping at discount stores at least monthly, regardless of their income level.

Surely, the impetus may vary:

•   For many, discount stores are a vital tool when sticking to a tight budget.

•   For others, it might be a way to find splurges, both large and small, at the right price.

Still, though circumstances may vary, a whopping 78% of respondents are laser-focused on snagging the lowest possible prices for items on their list.

While shoppers may have been swayed by ambience and amenities at stores in the past, now it’s all about getting top value for every hard-earned dollar. Sticking to — and stretching — one’s budget is the new black. Also worth noting: Among the ranks of discount shoppers are high-earners pulling in six figures.

SoFi’s proprietary research found intriguing and unexpected facts about just who’s hitting the discount stores, what they are hunting for at these retailers, and why the face of shopping may never be the same again.

Where the Buyers Are: 74% of Respondents Dropped Into Dollar Tree

Curious about which discount retailers are topping shoppers’ lists? According to SoFi’s Discount Shopping Survey, almost three-quarters (74%) of discount shoppers have dropped into a Dollar Tree, where the motto is “Extreme Value Every Day,” over the past year.

It isn’t just those living paycheck to paycheck who are shopping at Dollar Tree:

•   64% of the survey’s highest earners (households bringing in $150,000+) say they’ve bought items at Dollar Tree in the last 12 months.

Discount shoppers are also looking elsewhere to find where the best buys are. Over the past year:

•   65% have shopped at Dollar General

•   42% at Five Below

•   41% at ALDI

•   38% at Big Lots

•   37% at T.J. Maxx

•   35% at Ross Dress for Less

•   35% at Marshalls

Where else are moneywise shoppers queuing up? It turns out that 22% have shopped at HomeGoods, while one in five (20%) has rung up items at brand-name outlets (Nordstrom Rack, for instance).

Discount Stores: The New Social Media Darlings

Reflecting their new status as many shoppers’ go-to destination, discount stores are accumulating hefty followings. As of September 2023, the stats are:

•   ALDI USA has 955K Instagram followers; 184K on TikTok

•   Dollar Tree has 675K Instagram followers; 76.6K on TikTok

•   Five Below has 706K Instagram followers; 214.3K on TikTok

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81% Discount-Shop at Least Once a Month

People aren’t just hitting the discount shops for an occasional find. Rather, SoFi’s discount shopping research uncovered that these retailers are quickly gaining traction as routine destinations for shoppers.

•   81% of respondents shop at discount stores at least once a month.

•   38% — practically four out of ten people — shop at discount stores weekly.

•   14% of respondents say you’ll find them shopping at discount stores several times a week. (These may be people who are saving money daily with their shopping habits.)

Compelling find: Close to half of high-income earners (those making $100,000+ a year) say they shop at discount stores at least weekly.

Inflation Surge Drives Shoppers to Discount Stores

If you’re wondering why discount shopping is surging, consider the economic state of our union. After inflation rates fell month after month for a solid year, July 2023 saw an uptick in prices that surely set some people on edge. (Inflation in July 2023 increased 3.2% from July 2022.)

What’s more, the cost of living is soaring. Social Security recipients enjoyed a cost of living adjustment (COLA) to the tune of 8.7% in 2023, one indicator of how steeply the price of, well, everything has been rising.

Indeed, consider this:

•   Nearly two-thirds of discount shoppers (63%) say inflation and rising costs have prompted them to shop at discount stores over the last 12 months.

•   In addition, nearly half of discount shoppers have ramped things up, with 49% saying they are hitting discount stores more frequently than they did before the inflation surge.

When it comes to defending one’s paycheck against price hikes, bargain-hunting is a smart maneuver. ”Inflation is real for just about all of us,” says David Bakke, a consumer finance expert and writer at personal finance blog Dollar Sanity. “My discount shopping has definitely increased. I find myself spending a lot more time at ALDI, Dollar General, and the like.”

Indeed, inflation is making over the way Americans shop. SoFi’s discount shopping data shows this significant stat:

•   40% of respondents say they “always” search for ways to save on their purchases when shopping.

•   Only 2% said they never search for ways to save.

Here are some of the leading tactics discount shoppers have used to cut costs:

•   41% have used couponing websites.

•   40% have subscribed to company emails.

•   31% have followed a company or brand on social media.

•   21% have joined a Facebook group or other online community.

•   18% have followed an influencer on social media who talks about discount shopping.

More Than Half Discount-Shop to Benefit Their Budget

In these challenging economic times, many consumers are embracing budgeting as a way to manage their finances. Almost six out of 10 discount shoppers (58%) say one of the biggest benefits of shopping at discount stores is the ability to stick to a budget.

This holds true for 62% of those with household incomes under $75K, as well as 46% of those pulling in $100K or more.

Other reasons to love these retailers? SoFi’s discount shopper respondents said:

•   Regular availability of discounted products (47%)

•   The convenience and accessibility of discount stores (46%)

•   The ability to find trendy or seasonal items at lower prices (45%)

Another shopping pattern that SoFi’s discount shopping survey uncovered: A significant number of discount shoppers are making most of their purchases from these lower-priced retailers:

•   36% make more than 50% of their purchases at discount stores.

•   Almost one in 10 (9%) of those with household incomes of $150,000 or more do more than 75% of their shopping at discount stores.

First on the Discount Shopping List: Groceries

It’s no secret that food prices can trigger sticker-shock, and that’s not just for luxuries like a pumpkin spice latte. Overall, food prices are ratcheting up 5.9% this year, per the USDA’s numbers, which may explain why consumers are hitting the low-cost stores for items they might otherwise buy at a standard supermarket.

According to the SoFi discount shopping research, groceries are the most common purchase made by discount shoppers: 78% buy groceries at discount stores.

And no wonder: These stores often have an array of staples and snacks, from coffee to cookies, and some are putting a health spin on things, as with Dollar General’s “Better for You” selections. Shopping at discount stores can be a solid way to save money on food.

“I shop at discount grocer ALDI,” says Melissa Cid, consumer savings expert with MySavings.com. “Chips, peanuts, cookies, yogurt, and ice cream are 25% to 50% cheaper than at traditional grocery stores.”

After food, the next most popular items:

•   Fashion and apparel: 58%

•   Beauty and skin care: 49%

•   Home decor: 40%

11% Splash Out When Discount Shopping

Think shoppers are only grabbing cereal, socks, and a bottle of shampoo? Not necessarily.

Yes, many people are hunting for lower-priced essentials at the discount stores, but super-low prices are also leading to big-ticket purchases, for some. According to SoFi’s survey:

•   11% of discount shoppers say the most expensive item they’ve purchased at a discount store in the past 12 months cost $250 or more.

Here is what shoppers say are some of the priciest items they purchased at a discount store:

•   18% say it was a fashion/apparel item.

•   16% say it was an electronic item.

•   13% say it was a home decor item.

“Tech gadgets and home essentials top the list of items that I purchase from discount stores,” explains Thomas Paddock, an Amazon FBA Six-Figure Seller and the founder of Learn Retail Arbitrage, an online selling resource. “These categories often carry substantial markups in conventional retail outlets. Discount stores can offer high-quality items at a more
reasonable cost.”

There is, however, a bit of a gender gap when it comes to shopping for certain items at discount stores:

•   36% of men have purchased electronics vs. 27% of women.

•   67% percent of women have made clothing purchases vs. 44% of men.

•   Nearly 3x as many men (22%) have made sports/outdoor purchases vs. women (8%).

Finding Fashion at Discount Shops? Yes, Says Gen Z

The SoFi discount shopping stats reveal that 67% of young people (aged 16-24) have purchased fashion and apparel items at a discount store within the last year.

Given that Gen Z is broadly recognized as the first digitally native generation, it’s probably no surprise that social media may have led many of them to these style purchases:

•   30% of respondents aged 16-24 have followed an influencer on social media who talks about discount shopping, vs. 18% of total respondents.

And the presence these retailers have on social media channels is significant. On Instagram, as of September 2023, T.J. Maxx has 2+ million followers, Nordstrom Rack has 1+ million followers, and Ross Dress for Less has 537K followers. All three have tens of thousands of followers on TikTok.

Almost 50% of Shoppers Seek Seasonal Wares

Seasonal and holiday shopping is (very) big business in the U.S., with Halloween spending, for instance, totalling $10.6 billion in 2022.

“Here today, gone tomorrow” items are part of the allure of discount stores, where goods can be found at a rock-bottom price. Consider these numbers from the SoFi survey:

•   45% of discount shoppers say one of the biggest benefits of discount stores is the availability of lower-priced trendy or seasonal items.

•   65% of discount shoppers are hunting for clearance or end-of-season items.

•   70% of women look for clearance and end-of-season deals at discount stores vs. 56% of men.

More Than Half of Discount Shoppers Spend Serious Time Bargain-Hunting

The new wave of smart shoppers are dedicated bargain-hunters. They will invest hours to get a great deal. In fact, more than half (51%) will spend between one and three hours extra to find savings or specific items at discount stores. A dedicated 4% are willing to spend five hours or more. (Of these, 63% have a household income of less than $50,000.)

Discount Shoppers Also Prioritize Availability

Low prices are the leading reason for the popularity of discount shopping, but availability of desired products is another big incentive:

•   52% head to these retailers for the specific items they know they can find there.

Whether it’s a favorite energy bar or shower gel, items that are part of a person’s usual shopping list are a big draw for discount shoppers.

This is especially true of the deep-pocketed respondents to the SoFi survey. Why spend top-dollar on your favorite matcha beverages or other small luxuries when you can buy them for much less?

•   60% of the highest earners (household income of $150,000 or more) say one of the reasons they shop at discount stores is for specific items they know they can find there.

There are a good number of impulse buyers among the aisles though:

•   Almost one in five (19%) discount shoppers say they don’t go to the stores looking for any particular item. Rather, they “go in without a plan and buy things that speak to them.”

As for the rest of the respondents to SoFi’s survey:

•   More than half of discount shoppers (51%) say they know what they need when they go to a discount store, but are open to buying items not on their list.

•   More than a quarter (26%) say they buy what they need and exit ASAP.

•   Only 3% say they just browse and rarely actually purchase anything.

And the Biggest Frustration With Discount Shopping Is…

Obviously, there is much to love about discount shopping, as detailed above. But, yes, there are a couple of pain points. Here, the two biggest downsides:

•   38% of discount shoppers say the items they want aren’t always available. That suggests that consumers would buy even more at these retailers if they could find everything they are hunting for.

•   22% say that the biggest downside is that the items are of a lower quality.

It seems that getting what you want, when you want it, may matter even more than an item’s quality.

That said, Thomas Paddock of Learn Retail Arbitrage contends that you can find good quality if you shop smart. “Contrary to general assumptions, not every item in a discount store is of inferior quality. Many times, these are overstock products or emerging brands,” he says. “Discount stores can be an avenue to discover value.”

The Takeaway

As inflation increases, shoppers of all income levels are finding that discount stores can serve their needs. Of the 1,500 consumers surveyed for SoFi’s Discount Shopping Survey in August 2023, 81% say they are visiting discount stores (think Dollar Tree, ALDI, and Five Below) at least once a month. Popular purchases are food, fashion, personal care, and home decor items.

What frustrates discount shoppers when seeking their budget buys? Lack of availability first and foremost, followed by lower quality of some goods.

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Annual percentage yield (APY) is variable and subject to change at any time. Rates are current as of 12/23/25. There is no minimum balance requirement. Fees may reduce earnings. Additional rates and information can be found at https://www.sofi.com/legal/banking-rate-sheet

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Although we do our best to recognize all Eligible Direct Deposits, a small number of employers, payroll providers, benefits providers, or government agencies do not designate payments as direct deposit. To ensure you're earning the APY for account holders with Eligible Direct Deposit, we encourage you to check your APY Details page the day after your Eligible Direct Deposit posts to your SoFi account. If your APY is not showing as the APY for account holders with Eligible Direct Deposit, contact us at 855-456-7634 with the details of your Eligible Direct Deposit. As long as SoFi Bank can validate those details, you will start earning the APY for account holders with Eligible Direct Deposit from the date you contact SoFi for the next 31 calendar days. You will also be eligible for the APY for account holders with Eligible Direct Deposit on future Eligible Direct Deposits, as long as SoFi Bank can validate them.

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See additional details at https://www.sofi.com/legal/banking-rate-sheet.
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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After graduation and your six-month federal student loan grace period, it’ll be time to start paying your dues. If you are on the Standard Repayment Plan, you’ll pay at least $50 a month for 10 years. But there are other ways to pay back your student loans: through income-driven repayment plans.

Not all of these plans have the same repayment strategy, and not all federal loans qualify for income-driven repayment. We’ll help you find the one that aligns with your financial situation before you commit.

How Does Income-Driven Repayment Work?

The U.S. Department of Education offers two income-driven repayment (IDR) plans for holders of federal student loans. (Two other plans, PAYE and Income-Contingent Repayment, are no longer accepting new enrollments.) The current plans are:

•   Income-Based Repayment (IBR)

•   Saving on a Valuable Education (SAVE) Plan

For IDR plans, your monthly payment is calculated as a portion of your discretionary income. The Department of Education defines discretionary income as your adjusted gross income in excess of a protected amount.

Discretionary income under the SAVE Plan, for example, is any adjusted gross income you have above 225% of the federal poverty guideline appropriate to your family size. You’ll have a $0 monthly payment under the SAVE Plan if your annual income doesn’t exceed the protected amount of $32,805 for a single borrower and $67,500 for a family of four in 2023.

If you don’t qualify for a $0 monthly payment on the SAVE Plan, your monthly payment beginning in July 2024 is set at 5% of discretionary income for undergraduate loans, 10% for graduate loans, and a weighted average if you have both.

On the IBR plan, your monthly payment is typically set at 10% to 15% of your discretionary income above 150% of the federal poverty guideline appropriate to your family size. But unlike the SAVE Plan, a borrower’s monthly payment on the IBR plan will never be more than what you would have paid through the Standard Repayment Plan.

IDR Loan Forgiveness

All federal IDR plans can end with your remaining loan balance being forgiven after 20 or 25 years, but some borrowers may receive forgiveness sooner under the SAVE Plan. Beginning in July 2024, federal student loan borrowers with original principal balances of less than $12,000 can have their remaining loan balance forgiven after 10 years of monthly qualifying payments on the SAVE Plan.

For more details on federal IDR debt relief benefits, check out our Guide to Student Loan Forgiveness.

Your personal circumstances and goals may dictate which student loan repayment plan is right for you. You can estimate how much your monthly payments will be through the federal Loan Simulator calculator.

💡 Quick Tip: Ready to refinance your student loan? You could save thousands.

The Difference Between Income-Driven Repayment Plans

Deciding which IDR plan is right for you (and that you may qualify for) depends on your financial situation and your loan type(s). Here’s what they mean:

•   IBR (Income-Based Repayment). This plan is based on your income and family size. The potential IBR payment must be less than what you would pay under the Standard Repayment Plan to qualify. Any remaining balance is forgiven after 20 or 25 years.

•   SAVE (Saving on a Valuable Education). This IDR plan replaced the former REPAYE Plan. Anyone with qualifying student loans can enroll into the SAVE Plan. However, you could end up paying more per month under this plan than the Standard Repayment Plan. You’ll have a $0 monthly payment under the SAVE Plan if your annual income falls below 225% of the federal poverty guideline appropriate to your family size.

Alternatives to Income-Driven Repayment Plans

The 2023 debt ceiling bill officially ended the three-year Covid-19 forbearance, requiring federal student loan interest accrual to resume on Sept. 1, 2023, and payments to resume in October 2023.

Aside from the Standard Repayment Plan, there are a few options to consider instead of IDR:

Consolidation

If you have federal student loans, you can get a Direct Consolidation Loan. This will move all your eligible federal student loans into one monthly payment. Your new interest rate is the weighted average of all your loans, rounded up to the nearest eighth of a percent.

This can be helpful if you have many smaller loans that each have a minimum monthly payment. It typically won’t lower your monthly payment, however, but it can make it manageable and easier to keep track of. Only federal loans are eligible for a Direct Consolidation Loan.

Refinancing

Refinancing is similar to consolidation. You get one loan to replace all of your other loans, but it’s a new loan with a new interest rate from a private lender or bank. Your credit report and other personal financial factors are considered to see if you’re a responsible borrower. If you previously had a co-borrower, such as a parent, you can look into refinancing without a cosigner.

Many lenders allow you to refinance all of your student loans, not just federal student loans. So if you have a mix of private student loans and federal student loans, refinancing will create one new loan with one payment to replace them.

If you qualify for a lower interest rate and a shorter term, it could reduce the amount of money paid in interest over the life of the loan. You may pay more interest over the life of the loan if you refinance with an extended term. You can explore different scenarios with our Student Loan Refinance Calculator.

You may ask, “Should I refinance my federal student loans?” Refinancing federal student loans with a private lender forfeits your access to Public Service Loan Forgiveness (PSLF), Teacher Loan Forgiveness, and federal IDR plans. You can weigh the pros and cons when determining whether student loan refinancing is right for you.


💡 Quick Tip: Refinancing could be a great choice for working graduates who have higher-interest graduate PLUS loans, Direct Unsubsidized Loans, and/or private loans.

How Do You Calculate Income for an Income-Driven Plan?

The Department of Education considers three different components when calculating a borrower’s income. While this may seem needlessly complicated, it actually benefits borrowers:

Annual Income

Any income that’s taxable counts toward the Education Department’s calculation. That means regular wages, plus interest and dividends from savings and investments, unemployment benefits, etc. On the flip side, any income that isn’t taxed doesn’t count: gifts and inheritances, cash rebates from retailers, child support payments, and so on.

Spouse’s Income

If you and your spouse file a joint tax return, then their income must also be factored in. If you file separately, only your income counts.

Family Size

Your family size is the number of people who live with you and receive more than half their support from you. This includes children but also dependent adults, such as an older parent.

The Takeaway

There are now two income-driven repayment plans for federal student loan holders, IBR and SAVE. The PAYE and Income-Contingent Repayment plans stopped accepting new borrowers as of July 1, 2024, although current enrollees can remain on the plan after that date.

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.

With SoFi, refinancing is fast, easy, and all online. We offer competitive fixed and variable rates.

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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).

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

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., Puerto Rico, U.S. Virgin Islands, or American Samoa, and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 4/22/2025 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

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

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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