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As of early 2025, the average cost of pet health insurance was $60 a month for dogs and $32 a month for cats, according to Met Life. As you might expect, the policy details, where you live, and the type of pet you have are among the factors that can impact pricing.

Pet insurance offers a way to help pay for the care of your beloved animal — whether it’s a routine checkup or an emergency. However, just like health insurance for humans, choosing the right pet insurance policy can be complicated.

There’s a wide range of coverage options and policy costs to consider. And pet insurance may not be the right fit for every pet owner. Here’s what to know.

What Is Pet Insurance?

Though it has a lot in common with human health insurance coverage, a pet policy falls under the property and casualty insurance classification.

Pet insurance has been around for almost 100 years, but has only been available in the United States since 1982, when a subsidiary of Nationwide sold its first policy to cover the dog that played Lassie on TV.

As with health insurance for humans, pet insurance has a range of options and costs to consider.

And it’s growing in popularity: The North American Pet Health Insurance Association reports that, as of 2024, the industry’s revenue grew 22% year over year and passed the $4 billion mark for the first time ever.

Most of the almost 5.4 million insured pets are dogs (80% in 2025) and cats (20%). But some insurers may offer coverage for birds, fish, and other pets.

Pet policies are designed to protect pet owners from the high cost of taking their animal to the vet, dealing with medical emergencies, and treating disease. If a pet needs care, it could otherwise drain their owner’s checking account.

(If a pet bites another animal or person, those costs typically are covered by homeowner’s insurance.)

Types of Pet Insurance

There are a few types of pet insurance. Coverage can be limited to accident-only care for an animal, or it can be more comprehensive and include treatment for injuries and illness.

Some policies also include wellness costs, such as vaccinations, dental care, and medical tests. A few include extra benefits, such as coverage for pet care when an owner has an emergency, or coverage for vet care when the owner travels out of the country with the pet.

But preexisting conditions and cosmetic procedures usually aren’t covered. And policies may come with a waiting period of, say, a few days or a month, which means if a pet is diagnosed with an illness or is injured before that time is up, treatment for that condition won’t be covered.

How Much Does Pet Insurance Cost?

The average cost of an accident and illness pet policy was $56.30 per month for a dog in 2025, or $675 per year, according to the North American Pet Health Insurance Association. For a cat, the average cost was $32 per month, or $384 per year. Adding wellness care and other benefits can increase the cost of a policy. So can the deductible, co-pay, and maximum coverage amounts the pet owner chooses. These costs are something to consider as you’re budgeting for a new dog or cat.

Reimbursement is typically 70%-90%, which means the insured pet owner can be reimbursed for up to 70%-90% of a qualifying claim. The deductible is typically $100, $250, or $500.

•  The cost of coverage also may be affected by where the pet owner lives. In cities or regions where veterinary practices generally charge more for office visits or treatments, the cost of pet insurance may be higher.

•  Coverage may cost more based on a pet’s breed and age as well. Because some purebred cats and dogs may be more susceptible to certain medical conditions, they can be more expensive to insure.

•  Age is a factor. The older a pet is, the more it may cost to get coverage — both at the time of enrollment and as the pet ages.

The good news is, there are typically no “out-of-network” provider charges to worry about with pet insurance. As long as the pet owner takes Fido or Fluffy to a licensed vet, and the expenses for the visit qualify, it’s just a matter of filing a claim. Some insurance companies may pay the vet directly, but most reimburse the pet owner after the claim is submitted and verified.

Recommended: 19 Tips to Save Money on Pets

How Can Pet Owners Find Prices and Plans?

Because every pet and every plan is a little bit different, it can pay to do some research.

An increasing number of employers now offer pet insurance in their benefits packages, which could mean a lower premium. So pet owners may want to check with their human resources department to see what their company has to offer.

It’s also easy to get an online price quote from many of the companies that offer pet insurance. A quick search will turn up several well-known insurers (Nationwide, Progressive, Geico, Allstate) that offer coverage, along with insurance companies that are strictly for pets. The insurer will ask a few questions (the pet’s name, age, gender, breed, any preexisting conditions), and then provide quotes for three or more plans, along with some details about the benefits those plans include.

It also may help to have an idea of what it costs to treat common (and not-so-common) problems a certain type of pet might encounter.

For example, a physical for a dog or cat can cost between $25 to $186 on average in 2025, depending on your location and the pet’s age. Those bills might be daunting but not necessarily devastating for a family’s budget. But an emergency vet visit with multiple overnight stays in an emergency clinic could be as much as $3,500. And surgeries your pet might require can run into the hundreds and even thousands of dollars.

Planning for those costs could help pet owners decide if insurance is something they should consider. (Your vet also may be able to provide some helpful information that pertains to your specific pet.)

💡 Quick Tip: If you’re faced with debt and wondering which kind to pay off first, it can be smart to prioritize high-interest debt first. For many people, this means their credit card debt; rates have recently been climbing into the double-digit range, so try to eliminate that ASAP.

So, Is Pet Insurance Worth It?

As with so many financial decisions, there are pros and cons to purchasing a pet health policy.

Insurance may take some of the stress out of making treatment decisions for a beloved pet based on the ability to pay. Although there still could be out-of-pocket expenses to consider, it might help avoid what the pet insurance association calls “economic euthanasia,” when a pet owner makes the heartbreaking choice to put down a sick or injured animal because the required care is just too expensive.

Insurance also might help a pet owner avoid taking on credit card debt or depleting their savings account to pay for their pet’s care.

Another plus: Because policies can be customized, it may be possible to find one that provides basic coverage and still works within the family budget. And pet owners who love their vet won’t have to switch to a new provider.

But pet insurance typically doesn’t cover pre-existing conditions, and premiums also may be higher for breeds that are vulnerable to costly health conditions. The cost also goes up as an animal gets older, which is when many pets start having problems that require expensive treatments.

And, as is the case for most types of insurance, if policyholders don’t use their benefits, they don’t get their money back. So, for example, if the pet owner opts for an accident and illness policy and the pet stays healthy for several years, the insurance bills could end up costing more than the vet bills. You may want to set up an emergency fund to help cover any healthcare costs for your pet instead.

Recommended: How to Pay for Medical Bills You Can’t Afford

The Takeaway

Pet health insurance currently costs about $60 a month for dogs and $32 a month for cats. It’s wise to look carefully at your options for pet health insurance to see if it suits your needs, considering such factors as price, coverage details, waiting period, and exclusions. You want to be sure you find the right fit, in terms of both the dollars involved and other needs, just as if you were choosing a new banking partner.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with eligible direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

FAQ

How much is pet insurance?

As of 2025, pet health insurance is typically around $60 a month for dogs and $32 a month for cats. Prices vary depending on the policy details and coverage, your pet’s breed, your location, and other factors.

Is pet insurance really worth it?

Pet insurance can be worthwhile if a pet’s care (such as emergency surgery) would not be covered by your emergency fund and could cause financial hardship. The decision of whether pet insurance is worthwhile has to be made based on your own particular situation.

What age is best to get pet insurance?

As with your own health insurance, you’ll likely find that health insurance for pets is more affordable when the animal is younger. For that reason, it may be a matter of sooner rather than later when it comes to getting pet insurance.

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

Eligible 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 (“Eligible Direct Deposit”) via the Automated Clearing House (“ACH”) Network every 31 calendar days.

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.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, Wise, 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 Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi Bank shall, in its sole discretion, assess each account holder's Eligible Direct Deposit activity to determine the applicability of rates and may request additional documentation for verification of eligibility.

See additional details at https://www.sofi.com/legal/banking-rate-sheet.
*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.

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.

This content is provided for informational and educational purposes only and should not be construed as financial advice.

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.

SOBNK-Q225-021

If you have a savings goal that’s coming up in the not-too-distant future — such as a large purchase, vacation, or wedding — you may want to consider some good short-term savings options.

There isn’t a hard and fast definition of short-term savings, but it’s typically considered to be money you want to use within the next few months or years.

While there are a number of options for short-term savings, one of the best places to start stashing cash for a short-term goal can be a savings account. They can offer safety (so you shouldn’t lose any money), liquidity (allowing you to access money when needed), and growth (meaning they are interest-bearing).

But some of these accounts offer more liquidity and higher interest than others. With a little reading and research, you can start socking your cash away in the right place — and start moving closer to those short-term savings goals.

Should You Invest Short-Term Savings?

Depending on your short-term savings goals, a savings account may be a wise move. One significant downside to any cash savings account is that they tend to have relatively low-interest rates.

You might however wonder: Should I invest this money in stocks or a mutual fund in order to meet my short-term goals more quickly?

Generally speaking, for short-term money, your goal is not necessarily to maximize returns. It is to control the risk — to keep it safe — so that the money is available when it’s needed.

While everyone’s risk tolerance is different, the downside to investing in the market is that you might lose money in the short term. Investment returns start to “smooth out,” or return their average yield, over longer periods. Shorter periods tend to be volatile and unpredictable — especially in the stock market.

To invest in the short-term would require complete flexibility — if the market were to fall steeply, it would likely be best to wait it out and avoid realizing losses. Suddenly, you’re on the market’s timeline, not your own.

Because of this, these investments may be inappropriate for an emergency fund, which needs to be accessible at all times. The same goes for those financial goals with a hard deadline (such as wanting to use this money as a down payment in two years).

That said, there’s a trade-off. Many of the options for short-term savings may not keep up with increasing prices, or inflation, and its impact on the cost of living. “For money you’ll use in three to seven years, you may be prepared to take slightly more risk than a savings account,” says Brian Walsh, CFP® and Head of Advice & Planning at SoFi. You might choose to use a brokerage account where you can invest that money in stocks, bonds, cash, or other asset classes. Just be sure to keep your comfort with risk in mind.”

If you’d prefer to avoid risk with your short-term savings, here are options to consider.

Option 1: Online Savings Account

Online savings accounts, also sometimes referred to as high-yield savings accounts, are an increasingly popular option for short-term savings. As their name implies, these accounts are offered by banks or financial institutions that only operate online. Here’s the scoop:

•   That means no brick-and-mortar locations and no chatting up a banker face-to-face. The upside: When you compare accounts offered by traditional banks vs. online banks, the latter typically have lower overhead costs and pass that savings onto their customers in the form of a higher annual percentage yield (APY).

•   A potentially higher rate of interest isn’t the only reason to use online-only savings accounts. The websites and mobile apps for online accounts essentially serve as storefronts, so online financial institutions often devote lots of resources to make sure they’re optimized and easy to navigate.

•   Additionally, many online-only institutions don’t have monthly account fees, which can be a real burden for those at the start of their savings journey. (For example, some traditional banks might charge a fee when you balance drops below the minimum.)

•   Banking online doesn’t mean you have to forgo the conveniences of your neighborhood bank. You can typically still do all of the important banking duties, such as depositing checks (via mobile deposit, or snapping a picture of the check on your phone), moving money back and forth between accounts, and speaking with a customer service rep.

In the past, the Federal Reserve limited savings account withdrawals to six per month, but this rule has been lifted. Even so, some banks have continued to put limits on the number of withdrawals you can make from a savings account. Before you sign up, you’ll want to understand the rules for accessing your money.

Also, while online banking is now considered mainstream, it’s always smart to do a little background research before you open an online account. You may want to check, for instance, to make sure an institution has Federal Deposit Insurance Corp (FDIC) coverage, a government-guaranteed program that protects your money up to certain limits.

Option 2: Certificate of Deposit

A certificate of deposit (CD) is a savings account that holds a fixed amount of money for a designated period of time, such as six months or three years. In exchange for the deposit, the bank pays a fixed rate of interest.

Generally, CDs with longer maturities offer higher interest rates. However, this isn’t always the case. For example, banks may offer high interest rates on short-term CDs when they expect the Federal Reserve to cut rates in the future. As a result, it pays to shop around and compare CD rates and terms.

You may also want to keep in mind that the interest rate on a CD is locked in at the point of purchase, as opposed to the interest rate in a savings account (both traditional and online-only), which may fluctuate. If you’re interested in locking in a certain rate, you may want to consider a CD. (Although be aware that you would be locking yourself into a lower rate if rates rise.)

While savings accounts are designed to provide regular access to your money, CDs are not. Because CDs have a fixed time frame, there may be a penalty to access the money before the period is over. And in exchange for the lock-up period, CDs generally offer higher rates than traditional savings accounts.

CDs can be a good option for people who don’t need to touch their short-term savings for a certain period of time. And they are typically FDIC-insured.

Option 3: Money Market Account

A money market account (MMA) is a mix between a savings and a checking account.

These accounts, offered by banks and credit unions, can allow you to write checks (though you may be limited on how often) and may also have a debit card. (Savings accounts, whether online or at a traditional bank, typically do not offer checks or a debit card.)

Returns on these accounts often beat those on traditional savings accounts. Depending on what’s happening in the economy overall, an MMA may be in line with that of an online-only bank account.

However, MMAs sometimes require higher minimum balances than other types of savings accounts. So, this might be a better option for those with more money to save.

MMAs are considered a safe choice since, like other types of savings accounts, they are typically covered by FDIC if held by a bank, and National Credit Union Administration (NCUA) if held by a credit union. (Although, it’s always a good idea to double-check insurance coverage to be sure.)

Keep in mind that MMAs differ from money market mutual funds, which are not FDIC- or NCUA-insured.

Option 4: Cash Management Account

A cash management account (CMA) is a cash account offered by a financial institution other than a bank or credit union. These accounts are designed to merge the services and features of checking, savings, and investment accounts, all into one offering.

While CMAs are typically offered by financial service providers that are not themselves technically classified as banks, they are still usually covered by FDIC deposit insurance like regular bank deposits — often through a partner bank.

Generally, CMAs function similarly to a traditional checking account, yet pay interest that is often higher than regular savings accounts.

Some brokerage firms require a large minimum deposit to open a CMA, or may charge monthly fees for anyone under that minimum. Before opening a CMA, it’s a good idea to ask about monthly fees and minimum balance requirements.

Also, since CMA providers typically “sweep” your uninvested cash into interest-paying deposit accounts held at partner banks, you’ll want to make sure those sweep accounts are FDIC-insured.

The Takeaway

Short-term savings is money that you likely will need in the not too-distant future, such as within a few months or years.

There are a number of options for short-term savings, but some good bets include online savings accounts, CDs, money market accounts, and cash management accounts. These accounts tend to be low-risk and generally offer a higher return than a traditional savings or checking account.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with eligible direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

SoFi Checking and Savings is offered through SoFi Bank, N.A. Member FDIC. 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.

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

Eligible 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 (“Eligible Direct Deposit”) via the Automated Clearing House (“ACH”) Network every 31 calendar days.

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.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, Wise, 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 Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi Bank shall, in its sole discretion, assess each account holder's Eligible Direct Deposit activity to determine the applicability of rates and may request additional documentation for verification of eligibility.

See additional details at https://www.sofi.com/legal/banking-rate-sheet.
*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.

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.

We do not charge any account, service or maintenance fees for SoFi Checking and Savings. We do charge a transaction fee to process each outgoing wire transfer. SoFi does not charge a fee for incoming wire transfers, however the sending bank may charge a fee. Our fee policy is subject to change at any time. See the SoFi Bank Fee Sheet for details at sofi.com/legal/banking-fees/.
Third Party Trademarks: Certified Financial Planner Board of Standards Center for Financial Planning, Inc. owns and licenses the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®

SOBNK-Q225-034

With a cash-back credit card, you receive a refund of a portion of your purchases as cash applied to your account. This is usually a small percentage of what you charge. This can be a money-wise bonus for using a given card. In fact, recent research shows that 68% of Americans have this kind of card in their wallet.

If you’re thinking about adding a credit card to your wallet or want to maximize your savings with the one you have, read on. Here is what you should know about cash-back rewards, including how cash-back rewards work, and whether this type of rewards card makes sense for you.

What Are “Cash-Back Rewards”?

Cash-back credit cards are offered by many credit card companies to qualified consumers. Consumers can use these credit cards to make purchases, and a certain percentage of that purchase is returned to the customer as a cash incentive. In other words, cash-back rewards can be an easy way to make the most of everyday expenses.

Typically, cash-back rewards range between 1% and 2%; however, a few cards offer more.

There are different types of credit cards, and rewards cards can vary. Some rewards cards offer a set number of points per purchase that can be redeemed later for cash or for goods like airline tickets, discounts at coffee shops, or gift cards.

How Does Cash Back Work?

Cash-back rewards are easy to use. All that consumers have to do is spend as they normally do, and in return, the credit card company calculates the percentage to return to the cardholder based on what they spent on eligible purchases.

For example: A card pays a flat rate of 2% cash-back on all purchases. If the cardholder spends $1,000 in a statement period, the card issuer will then give the cardholder $20 in cash-back rewards. Some more details to consider:

•   Some cards will raise the percentage refunded for certain categories for a limited time. For instance, during one quarter of the year, you might get a higher percentage back on gas purchases, and then for the next period, a higher percentage back on travel expenses. (More on that below.)

•   The card issuer pays out the percentage at the end of a given term, which could mean paying it out at the end of a statement period or billing cycle, or even once you hit a predetermined amount, like $20.

•   Cash-back cards might come in handy for everything from large purchases to everyday needs. Think of it this way — rather than purchasing things with cash, which doesn’t provide any added benefits, a cash-back card could return money right into a consumer’s pocket.

However, in order for that money to really pay off, the cardholder will likely want to pay off the credit card balance every month in full so they’re not accruing interest and fees, and negating that cash-back reward.

One thing to remember is that cash-back cards are different from other rewards cards. There are rewards cards that offer specific travel rewards, cards that partner with gas stations to earn free gallons, and many more.

Four Ways to Redeem Cash-Back Rewards

Depending on the cash-back card, there may be a number of different ways you can redeem cash back rewards. Here are some commonly offered options.

1. Credit card balance reduction: This allows you to have your cash rewards applied to your balance and use them to pay off a portion of your monthly bill.

2. Gift cards: Some card issuers allow you to redeem your cash-back rewards in the form of gift cards to your favorite retailers or restaurants. To sweeten this deal, some issuers partner with other companies, such as online retailers or airlines, to provide bonus payouts when cash-back rewards are redeemed with a gift card.

3. Charitable giving: Several card providers allow users to use their cash back for good, sending their rewards directly to the charity of their choice. All that users need to do is select the charity, and the card does the rest.

4. Paper check or direct deposit: You can often redeem your cash back as just that — cash. In this case, you ask your card issuer to transfer the money directly to your bank account or send a paper check.

The Different Types of Cash-Back Cards

While cash-back cards all work in a similar way, there are some differences between these cards to keep in mind.

•   Some are flat-rate cards, which means that cardholders receive the same exact cash-back percentage on every eligible purchase, be it groceries or plane tickets. This option is easy as users never have to think about the way they use their cards.

•   Another option is a bonus category cash-back card. These cards offer higher cash-back percentages on certain purchase categories. For example, you might get more cash back on gas and groceries (say 2% or 3%) than you do on other items (say 1%). If you opt for this type of card, it can be a good idea to make sure the higher variable percentage is for items you purchase often.

   Note: Just be careful that these promotions don’t encourage you to spend more than you planned just to get that cash-back bonus. That could drive up your credit utilization ratio and ding your credit score.

•   Some cards rotate these bonus purchase categories every quarter, and you need to activate your rotating bonus categories in order to earn rewards. Others allow you to choose your bonus category.

Any of these cards may offer additional features, such as:

•   Special promotions One way to earn even more cash back may be via a special promotion run through the credit card. For example, a credit card may typically offer 1% cash-back. However, for one billing cycle, it could partner with a large retailer for 5% cash back for all eligible purchases.

•   Sign-up bonuses Cash-back rewards cards might also come with sign-up bonuses to attract new customers. This might be a certain lump sum of cash back (say $100) if you spend a certain amount in the first three months. Or, you might be able to earn double or triple cash back for a set period of time.

Potential Drawbacks of Cash-Back Rewards

Cash-back credit cards can come with a few potential downsides that users may also want to be aware of. As with signing up for any new credit card, it’s a wise idea to read the fine print.

For instance, you may want to be sure to read through the contract carefully to understand exactly how the rewards work, what to expect along the way, and also suss out any hidden credit card fees such as late payment fees, balance transfer fees, foreign transaction fees, and more.

It can also be a good idea to find out if the card has a high annual fee, which may negate any earned rewards, and what the APR (annual percentage rate) is, in case you get into a bind and need to carry over a balance month to month. However, it’s key to keep in mind that carrying a balance nearly always outweighs any rewards.

It’s also important to note that many credit cards (cash-back or otherwise) can retain the right to change their bonus structure at any time. That means it could change the percentage of cash users receive in return for purchases for a lower (or higher) amount. So, users might want to be happy with the card and its rates and policies, not just the cash-back rewards, as that could change at any moment.

When looking at the fine print, consumers might also want to identify if the card comes with a cap on possible rewards. Many cards limit just how much money a user is allowed to claim, so make sure to know that number and be comfortable with the limit.

And, again, like all cards, it’s key to pay off a cash-back rewards card in a timely fashion. This way, users won’t be paying interest on purchases with a card that was meant to bring them a little money in return.

Recommended: Understanding Purchase Interest Charges on Credit Cards

The Takeaway

Cash-back is a credit card rewards benefit that refunds the cardholder a small percentage of some or all purchases made with the card. Every time you make an eligible purchase with your cash-back credit card, your card issuer will pay you back a percentage of that transaction. Your cash-back reward won’t necessarily pay out immediately. Like your statement balance, your rewards will accrue each month and show up on your monthly statement.

Whether you're looking to build credit, apply for a new credit card, or save money with the cards you have, it's important to understand the options that are best for you. Learn more about credit cards by exploring this credit card guide.

FAQ

How do cash-back cards work?

With cash-back rewards, you receive a small percentage of a purchase price back as a refund on your credit card account. Some credit card issuers may offer higher percentages in certain categories for a limited time.

Is cash back just free money?

While cash back may feel like free money, it’s actually just a small discount on your purchases. That’s a nice perk, but you are still spending money on credit that needs to be repaid.

Is cash back from a credit card a good thing?

Cash back is a nice perk to enjoy as a credit card holder, but keep in mind that cards offering this reward may charge higher interest rates than those that don’t offer this feature.

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.

This content is provided for informational and educational purposes only and should not be construed as financial advice.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

Regularly paying your bills on time can help you avoid doling out money on interest and fees. It can also help build your credit score, which might help you snag the best interest rates when qualifying for loans or getting a credit card.

Fortunately, organizing your bills isn’t hard. You might use an old-school accordion folder and a calculator to manage the process. Or you might decide to handle the whole process digitally.

Here are some smart ideas for how to organize those bills.

1. Setting Up a Bill-Paying Station

Do you have a convenient spot where you can open, organize, and pay your bills? If you get paper bills, consider setting up a dedicated desk or area or (if space is tight) a roll-away cart. The goal is simply to keep everything in one place, instead of scattered around in your car, bag, or on the kitchen counter.

It’s a good idea to stock your station with all the items you’ll need to get the job done. Depending on how you pay your bills, this might include: envelopes, stamps, pens, your checkbook, a calendar, a filing system for sorting paper bills as they arrive, and storing those you’ve paid.

Or, if you pay your bills digitally, you could set up a separate virtual bill paying space. You might, for instance, set up an email account just for bills. This will ensure that you don’t overlook an electronic bill in the midst of the other emails you receive. You might also use your current email and create a folder, with subfolders, for anything related to your finances. That way, you’ll know exactly where to look if you need to check on a bill or other financial correspondence.

2. Making a Master List of Monthly Bills

Creating a list of every single bill you pay can be another way to help ensure that nothing falls through the cracks. It can also help you see where your money goes and how much money you have left after paying bills (if any).

You can do this with pen and paper, or create a printed out or online spreadsheet that includes a column for each month (allowing you to simply check off each bill as it gets paid). Check your bank account and credit card statements for bills you pay less frequently (annual subscriptions, quarterly membership fees, tax bills, etc.), and anything that’s on autopay.

For each bill, consider including: the vendor/service provider/lender, the account number, contact information, the bill’s due date, the date you think you should send/make the payment so it’s always on time.

For loan/credit card bills, you may want to also include the balance owed, and the minimum monthly payment.

You can use this list to make decisions about which bills you might want to set up by automating your finances and which you’ll pay manually.

And once it’s done, you can keep a copy on your bulletin board and/or in your files to use as a checklist.

Recommended: How to Pay Bills When You’ve Lost Your Job

3. Using Automatic Payments When Appropriate

Looking for other ideas on how to organize bills? There are two basic automatic bill payment options.

•   One is setting up automatic debit payments with a merchant or service, which involves giving them your checking account or debit card number and authorizing them to withdraw money on a recurring basis to pay a bill.

•   Another way is to authorize your bank or credit union’s bill pay service to send recurring payments to a company.

Either way you set it up, there are both pros and cons to using automatic payments, or autopay.

Here are the pros:

•   Autopay can help simplify your finances, since you don’t have to write out checks or log on to various websites to pay online every month.

•   It also ensures that it happens. The money is whisked out of your account before you have a chance to think about it or forget to think about it. Automating this process can help you save on interest and fees.

Here are the cons, because that out-of-sight-out-of-mind factor has a downside.

•   Autopay can make it easier to forget that you’re still paying for a subscription service you don’t use anymore, for example, or you might not notice when a bill’s amount is incorrect.

•   If you don’t have enough money in your account when an autopay bill goes through, you could end up overdrafting your account, which can lead to overdraft or NSF fees.

If you generally have plenty of money in your account and you regularly check your bank and credit card statements to make sure the charges are accurate, autopay might be a good fit.

But if your account balance fluctuates, or you’re likely to forget about small or infrequent charges if they’re paid automatically, you may want to use a different payment method (or at least for certain bills).

One other point: If many of your bills hit on the same day of the month, you might talk to some of your payees about whether you can change your bill due date. That could help you spread out payments over the month is a way that eases your financial pressure.

4. Putting a Bill Paying System in Place

Once you’ve decided which (if any) bills you’ll manage with automatic payments, you can move on to choosing a strategy for paying all your other bills, as well as keeping track of autopayments.

You can go as full-on techie as you like, or handle it with classic pencil and paper. The key is simply having a system.

Some options to think about:

Paying Bills Right Away

There’s no reason you have to wait for a specific day of the week or month to pay your bills. With this method, you would just open and pay bills as they arrive in the mail or online.

Setting up Reminders

Another option is to set up reminders for when you need to pay each bill, whether in your digital calendar or a paper one, if you use it. In addition, some companies and service providers allow you to sign up for bill reminder emails or texts.

Paying Bills on a Specific Day

If you don’t want to (or can’t always) sit down immediately to write a check or get online to pay, you could make it a weekly, biweekly or monthly routine.

With this method, you would file any bills that arrive in a “to pay” folder or inbox. You might also consider opening them and organizing them by the due date.

If the due dates are all over the place or difficult to manage, you may be able to get the dates adjusted simply by calling or emailing the company or service provider. It’s also a good idea to go through autopay notices to make sure you agree with the amounts charged.

Choosing the Best Way to Pay Manually

Many service providers and lenders offer customers several different methods for paying their bills.

Besides autopay, you might be able to use an app, a website, an automated phone system, deliver a payment in person, or send it in the mail.

No matter which option you choose, try to remember to always keep some sort of record of the payment in your files.

5. Keeping Good Records

In addition to checking off each paid bill on your master list, you may also want to create a system for managing your records after you’ve made your payments.

One option is to file paper copies of all your bills, noting on each how much you paid, when you paid, and how you paid (including any confirmation numbers for online or phone payments or check numbers for payments you mailed). If any of these bills are needed for tax purposes, you may want to make a copy and file it with your yearly tax documents.

Another option is to scan each bill and file them digitally on your computer’s hard drive or in the cloud, using a folder for the year that has subfolders for each month.

You may also want to create a real or digital file with all your credit and debit card receipts until you have a chance to reconcile them with your statements. (It’s a good idea to hold onto any receipt, bill, or statement until you’re absolutely sure you won’t need it for taxes or some other purpose, such as an insurance claim.)

6. Designating a Family Bookkeeper

Here’s another way to go about organizing your bills. If one spouse or partner has a knack for organization and bookkeeping and the other is less inclined, you might want to have the “numbers” person take the lead on the household’s bill-paying duties. (Have you ever missed a payment because you each thought the other would take care of it?)

Another option is to sit down together to work through the bills. Or, you might decide to alternate from month to month. You could make it a “money date” and do it over coffee at home.

No matter which approach you choose, consider setting up a regular time to sit down together and review the household budget, see how you stand, and make sure you both have access to account information, including passwords.

You also may want to consider setting up a separate account for paying household bills.

7. Using Budgeting Tools/Apps

Technology can step in and help you manage your bills, too. There are an array of ways to track your spending and paying. Your financial institution may offer digital tools for this, or you can download apps for this purpose, whether free or paid options.

You might want to experiment with a few and see which suits you best, depending on, say, whether pumping up your savings account or avoiding late payments is your key goal with organizing your finances.

8. Using the Cash Envelope Method

There are a variety of budget techniques you might use. One popular one is the envelope method, which involves setting key budget categories, writing the name of each on an envelope, and putting the designated amount of cash for the month ahead into it.

Then you pay the bills from the appropriate envelope as needed. Once the money from an envelope is gone, it’s gone. You either have to forego spending in that category or else borrow from another envelope.

For those who prefer not to use cash, this program can be adapted to involve debit card payments or checks.

Recommended: Savings Calculator

The Takeaway

Setting up a simple bill organization system can save you time, stress, as well as money, and can also make it easy to access records you need come tax time. Smart ways to organize your bills include creating a master list of all your monthly bills, deciding when autopay makes sense (and when it might not), and creating a virtual or actual filing system to track and streamline the bill paying process.

You might have to try a few different methods to figure out what works best for your situation. Another move that might help you get your finances organized is finding the right banking partner.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with eligible direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

FAQ

What bills are most important to pay?

While all bills are important to pay, basic living expenses (the things that keep you up and running, such as rent, utilities, and healthcare) and debt (student loan payments, for instance) can be priorities.

How do I organize my monthly expenses?

There are many ways to organize your monthly expenses, depending on your personal preferences and financial style. You might use an app or pencil and paper; you could try the envelope budgeting method or set up autopay. Many people try a couple of techniques before they land on one that suits them best.

How do you simplify bill payments?

Many people find that either using an app or automating their bills makes payment simpler. Your bank might offer a good app, or you can download one. And automating bill payments is something that vendors may set up for you or you can set up with your financial institution.

SoFi Checking and Savings is offered through SoFi Bank, N.A. Member FDIC. 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.

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

Eligible 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 (“Eligible Direct Deposit”) via the Automated Clearing House (“ACH”) Network every 31 calendar days.

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.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, Wise, 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 Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi Bank shall, in its sole discretion, assess each account holder's Eligible Direct Deposit activity to determine the applicability of rates and may request additional documentation for verification of eligibility.

See additional details at https://www.sofi.com/legal/banking-rate-sheet.
*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.

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.

This content is provided for informational and educational purposes only and should not be construed as financial advice.

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

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Designed to help you cover life’s financial curveballs, an emergency fund is a stash of cash that can be kept in an array of places. One good option is a savings account that offers you convenient access to your money, a competitive rate on deposits, and minimal fees. This can be a much safer and less risky option than, say, keeping cash in a jar in your closet.

But that’s not the only alternative. Read on to learn more on this topic so you can decide where to put emergency funds.

Where to Keep Emergency Funds

There are a variety of places you can keep an emergency fund, which ideally amounts to at least three to six months’ worth of living expenses. When making a decision, it’s important to consider what works best for your lifestyle. And you’ll also want the security of knowing your money is safe, so it can be best to bank at a financial institution that is insured by the FDIC (Federal Deposit Insurance Corporation) or NCUA (National Credit Union Administration).

With that in mind, here are five possibilities you might consider when looking for the best way to store emergency funds.

1. Traditional Checking or Savings Accounts

You might consider keeping emergency savings in a traditional checking account or savings account at a brick-and-mortar bank. On the pro side, that could make it easier to access your money in an emergency. However, you may not get the best rate for your money. Also, checking accounts often don’t earn you any interest, and their accessibility can make it tempting to dip into the funds for something that isn’t a true emergency.

Traditional banks are not known for offering the highest annual percentage yields, or APYs, on savings accounts either. You’re also more likely to pay a monthly maintenance fee for a traditional savings account than one at an online bank.

Recommended: Emergency Fund Calculator

2. High-Yield Savings

High-yield savings accounts offer above-average rates on balances. For example, you might find a savings account with an APY that’s several times higher (or more) than the national average.

It’s more common to find high-yield savings accounts at online banks vs. traditional banks. That’s because online banks tend to have lower overhead costs so they’re able to pass on savings to their customers. You’re also less likely to pay a monthly fee for a high-yield savings account.

Of course, with an online bank, you won’t have branch banking access to your savings account. You may, however, be able to access your account via an ATM card or debit card, or by transferring funds to a linked account.

3. Bonds

A bond is a type of debt instrument. When you buy a bond, you’re agreeing to let the bond issuer use your money for a set time period. In return, the issuer agrees to pay interest back to you.

Bonds can be attractive since you can earn decent interest rates on savings. However, they’re not great for accessibility since you have to wait for the bond to mature to get your money back.

You could cash out a bond early but that might mean forfeiting some of the interest you could earn. So you may want to consider bonds for money that you’d like to invest, versus money that you might need to tap into for emergencies.

4. Certificate of Deposit (CD) Accounts

A certificate of deposit or CD is a time deposit account. When you put money into a CD, the bank agrees to pay interest on your balance over a set time period. Once the CD matures, you can either withdraw your initial deposit and the interest or roll it all over to a new CD.

CDs can be a reliable way to save, since interest rates are guaranteed. However, your money is locked in for the entire maturity term. If you need to break into a CD early, your bank may charge an early withdrawal penalty. That could cost you some or all of the interest earned.

If you’re interested in using CDs for emergency savings, you might consider a CD ladder. Laddering CDs means opening multiple CDs with different maturity terms. That way, you always have a CD maturity date on the horizon. CD laddering could also help you to capitalize on rising interest rates since you can roll expiring CDs into a new account with a higher APY.

5. Money Market Accounts

Money market accounts combine features of savings accounts with checking accounts. For example, you can earn interest on balances and you might also get a debit card or paper checks that you can use to access your money.

A money market account can offer flexibility since they’re easier to access than bonds or CDs. And you might find money market accounts at online banks that offer rates comparable to what you could get with a high-yield savings account or CD. However, read the fine print: There may be minimum account opening and balance requirements as well as monthly fees to be paid.

If you’re considering a money market account for your emergency fund, consider the fees. An online money market account might be preferable for minimizing what you pay in fees while getting a competitive rate. Remember, the best account for an emergency fund will be the one that suits your specific needs.

Recommended: Smart Ways to Manage Your Money

The Takeaway

Having an emergency fund can help you sleep easier at night if you know that you’re covered should an unexpected expense crop up. If you’re looking for the best emergency fund savings account option, you can start with your current bank then compare it to other banks. Look for a combination of high APY and low (or no) fees to make the most of your money.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with eligible direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

About the author

Rebecca Lake

Rebecca Lake has been a finance writer for nearly a decade, specializing in personal finance, investing, and small business. She is a contributor at Forbes Advisor, SmartAsset, Investopedia, The Balance, MyBankTracker, MoneyRates and CreditCards.com. Read full bio.

FAQ

What type of account is the safest for emergency funds?

A bank account at an FDIC-member bank is the safest option for holding your emergency fund. FDIC insurance protects your deposits in the rare event that your bank fails. Accounts that can be FDIC-insured include savings accounts, money market accounts, checking accounts, and CD accounts. NCUA serves a similar function insuring credit union accounts. Both offer $250,000 coverage per depositor, per account ownership category, per insured institution.

Should I open a separate bank account for my emergency fund?

Opening a separate bank account for an emergency fund can be a good idea if you’re worried that you might be tempted to spend savings that are mingled with other funds. Having a separate savings account that’s linked to your checking account can allow for easy transfers. You’ll also continue earning interest until you withdraw the money.

Should emergency funds be kept in cash?

Keeping an emergency fund in cash can be problematic as it increases the risk of the money being lost or stolen. You’re also not earning any interest by keeping emergency funds in savings. What’s more, certain emergency expenses might need to be paid using a check or debit card, which would still require you to deposit your cash into a bank account at some point.

More from the emergency fund series:

<

Emergency Fund: What It Is and Why It’s Important

How Much Money Should Be in Your Emergency Fund?

How to Build an Emergency Fund

Emergency Fund Calculator

When to Use Your Emergency Fund

Should You Ever Invest Your Emergency Fund?

>

Photo credit: iStock/dobok

SoFi Checking and Savings is offered through SoFi Bank, N.A. Member FDIC. 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.

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

Eligible 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 (“Eligible Direct Deposit”) via the Automated Clearing House (“ACH”) Network every 31 calendar days.

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.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, Wise, 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 Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi Bank shall, in its sole discretion, assess each account holder's Eligible Direct Deposit activity to determine the applicability of rates and may request additional documentation for verification of eligibility.

See additional details at https://www.sofi.com/legal/banking-rate-sheet.
*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.

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.

This content is provided for informational and educational purposes only and should not be construed as financial advice.

Third Party Trademarks: Certified Financial Planner Board of Standards Center for Financial Planning, Inc. owns and licenses the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®

SOBNK-Q225-015