InvestY Archives | Page 87 of 97

Feb

2023

All About $15,000 Personal Loans

By Caroline Banton | Credit, Family Finances, personal_loan | Comments Off

Personal loans used to be considered a last resort to resolve cash flow issues. Today, according to the U.S. Chamber of Commerce, personal loans are the fastest growing lending vehicle in the nation. Personal loans are appealing partly because of their flexibility. They can be used for almost any purpose, whether to fix up a home or consolidate credit card debt. Borrowers can receive anywhere from $1,000 to $100,000, choose a fixed or variable interest rate, even select the length of the loan.

Read on to find out more about how personal loans work, how to qualify, their advantages and disadvantages, and whether a personal loan is right for you.

What Is the Required Credit Score for a $15,000 Personal Loan?

You will likely need a credit score of at least 660 for a $15,000 personal loan. Many lenders don’t state a minimum required credit score because they will vary the terms for each borrower depending on their credit history. The higher your score, the more money you can qualify for and the better the interest rate.

Benefits of a $15,000 Personal Loan

A $15,000 personal loan is a sizable amount that can serve many purposes. Common personal loan uses include making large purchases, covering living expenses for a defined period, consolidating debt, and paying off a credit card with a higher interest rate. Here are some other benefits:

Interest Rates and Flexible Terms

There are many types of personal loans, and interest rates can be fixed or variable. The interest rate that a lender charges will depend on the borrower’s credit rating and the length of the loan, but rates are typically lower than for other forms of debt. Loan lengths can vary from a few months to a few years.

No Collateral Required

Personal loans are typically unsecured, which means no collateral is required. If you don’t qualify only for an unsecured loan, you may select a loan cosigner with a stronger credit rating to help you get approved.

Recommended: Guarantor vs Cosigner

Fixed Monthly Payments

Most personal loans have fixed monthly payments based on the amount borrowed, the interest rate, and the term. This makes budgeting easier because the borrower knows how much they must pay each month.

Recommended: Try Our Personal Loan Calculator

Cons of a $15,000 Personal Loan

One disadvantage of a $15,000 personal loan is that it can be expensive, especially if you have bad credit or need to spread the payments out over many years. The longer the term, the more you will pay in interest. Here are some other issues to consider:

Taking on Debt

If you already have trouble paying your monthly bills, taking on more debt may not be a good idea. Some borrowers use a personal loan to consolidate other debt that charges higher interest, such as credit cards. For people who have a tendency to overspend, freeing up their credit may just encourage them to spend more again.

Higher Payments Than Credit Cards

Credit cards do not have a deadline to pay off the entire debt. For that reason, the monthly minimum payment is typically less than the payment on a personal loan. If a personal loan is used to consolidate credit card debt, some borrowers may find it difficult to make the higher payments of a personal loan.

Origination Fees and Prepayment Penalties

Some lenders will charge an origination fee to cover the cost of setting up the loan. Additionally, if the borrower wants to pay off the loan before the payoff date, the lender may charge a penalty. Borrowers should find out about any fees and penalties before deciding on a lender.

Interest Rates May Be Higher Than Other Options

For borrowers with poor credit, the interest rate on a personal loan can be high. In this case, a credit card might be a better option.

Where Can I Get a $15,000 Personal Loan?

Online lenders, traditional banks, and credit unions all provide $15,000 personal loans. Some online lenders pre-qualify borrowers so they can see the terms, and many will deposit funds into a bank account within one to two days.

Traditional banks or credit unions may offer better terms to their members because there is a pre-existing relationship. But they may also want to meet with a borrower in person to negotiate the loan.

How to Get a $15,000 Personal Loan

The steps to get approved for a personal loan are typically the same regardless of the lender. The first step, before you even apply, is to review your credit history. You can pull a report for free from each of the three major credit bureaus — Equifax, Experian, and TransUnion — from the website AnnualCreditReport.com. Then you can file a dispute online to have any inaccuracies removed. This can boost your credit rating and ensure you get the best terms from a lender.

Here are the basic application steps you’ll need to be prepared for:

1. Check Your Eligibility

Shop around for the best loan terms and find out if you qualify. Check both online lenders and traditional lenders, paying special attention to origination fees and prepayment penalties.

2. Get Pre-qualified

Getting pre-qualified will show you what terms the lender is offering based on your credit history. Fill out the online form, including how much you want to borrow and your desired payoff time frame.

Lenders will pull your credit report to pre-qualify you, which may ding your credit score. Focus on lenders who will perform a “soft inquiry” for pre-qualification, which will not affect your credit rating.

3. Check the Terms

Once you are pre-qualified, review the pre-approval letter and check the loan amount. Check whether it is an unsecured or secured loan, the annual percentage rate (APR), and whether the interest rate is fixed or variable. Pay attention to the monthly payment and the payback term. Also look for fees, penalties, and other potential charges.

4. Apply for the Loan

Gather the documents that you will need to apply for the loan. Borrowers typically need to upload a pay stub, mortgage or rent agreement, debt documentation, proof of identity, and their social security number.

Applying for Other Small Loan Amounts

Loan amounts can range from $1,000 up to 100,000. The terms for a small $3,000 personal loan will vary with those for a larger loan. Here are some examples of loan interest rates, terms, and monthly payments.

$5,000 Personal Loans

Here’s a typical scenario for a borrower with average credit (700–759 credit score): The monthly payments on a $5,000 personal loan, paid back over five years at an APR of 15.75% to 18.25%, would be around $121–$128.

$10,000 Personal Loans

For a $10,000 personal loan paid back over five years at an APR of 12.75% to 15.25%, a borrower with average credit would pay $226 to $239 per month.

$20,000 Personal Loans

For a $20,000 loan paid back over five years at an APR of 12.75% to 15.25%, a borrower with average credit would pay $452 to $478 per month.

The Takeaway

Personal loan interest rates are determined by a borrower’s credit rating and financial history. The higher the credit rating, the lower the interest rate. For consumers with good credit, a $15,000 personal loan can be a more affordable form of debt than credit cards. For consumers with bad credit, the higher interest rate may make a $15,000 personal loan less attractive.

SoFi offers competitive personal loans. There are no origination, prepayment, or late fees as there are with some other lenders, and our competitive interest rates are fixed, making budgeting easier.

SoFi’s Personal Loan was named NerdWallet’s 2022 winner for Best Online Personal Loan overall.

FAQ

What credit score is needed for a personal loan for $15,000?

A credit score of at least 660 is typically required for a $15,000 personal loan. Some lenders that cater to people with poor credit will charge higher interest rates and fees to cover their elevated risk.

How long can I get a $15,000 personal loan for?

Personal loans are typically for three, five, or seven years. The shorter the repayment period, the less interest you will pay over the life of the loan.

What would payments be on a $15,000 personal loan?

The monthly payments on a $15,000 loan depend on the interest rate and repayment terms. If you know how much you want to borrow, over what period, and at what interest rate, an online loan calculator can tell you what your payments will be.

Photo credit: iStock/fizkes

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.

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 .

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.

Checking Your Rates: To check the rates and terms you may qualify for, SoFi conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, we will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.

SOPL0322014

Feb

2023

What is Ethereum Classic (ETC)? ETC vs ETH

Ethereum Classic vs Ethereum 2.0: What’s the Difference?

By Brian Nibley | Growing Wealth, invest, Investing | Comments Off

Ethereum 2.0 is the new and improved version of the original Ethereum project, while Ethereum Classic is a smaller, less well-known fork from the original Ethereum blockchain, dating back to 2016. The native coin of Ethereum 2.0 is ETH, unchanged from the original Ethereum project. The native coin of Ethereum Classic is ETC.

Ethereum 2.0 features a series of innovations and upgrades that became known as The Merge, when the project shifted from a proof-of-work system to a more efficient proof-of-stake algorithm in September 2022.

Ethereum Classic, meanwhile, still exists, but ETC has a much smaller market cap and lower price compared with ETH.

What Is Ethereum 2.0 (ETH)?

Although Ethereum is the second-largest crypto by market cap, the road to Ethereum 2.0 has been long and complicated.

History of Ethereum 2.0 and Ethereum Classic

It helps to think of Ethereum as evolving in three stages:

• The original Ethereum project and crypto (ETH) were created by Vitalik Buterin and launched in 2015 as the first programmable blockchain.

• In 2016, a hacking incident resulted in a hard fork of that original blockchain, which divided the Ethereum project in two. Users loyal to the original blockchain became part of Ethereum Classic — essentially the original Ethereum, untouched — creating a new coin ETC.

Those who favored the upgrade, which reconfigured the blockchain to address the hack and cyber theft, built a version known simply as Ethereum, which kept ETH as its native coin. Call it Ethereum 1.0.

• Then in late 2022 the Ethereum 1.0 blockchain completed a major shift from its legacy proof-of-work system, migrating to proof-of-stake. This more efficient blockchain is sometimes called Ethereum 2.0 — but that moniker is fading now that some of the major changes are in place.

So when people talk about Ethereum 2.0, they are referring to the latest upgrade to the far more energy-efficient, proof-of-stake consensus mechanism. But Ethereum 2.0 is really the same big crypto competitor that has been #2 in size and scope to Bitcoin’s #1 for years.

What Is Ethereum Classic (ETC)?

Ethereum Classic was created from a hard fork of the original Ethereum blockchain, and ETC is its native token. The hard fork was an effort to cope with a cyber attack in which $50 million was stolen.

ETH and ETC shared the same blockchain record prior to the hard fork. Since they both stem from the same project, Ethereum Classic has many of the same features as Ethereum 2.0. But owing to the substantial technological differences between the two chains, Ethereum Classic wasn’t able to support the kinds of innovations that have built Ethereum into the DeFi powerhouse it is today.

Ethereum is best known as one of the most successful programmable blockchain platforms, with the capacity to support smart contracts, dApps (decentralized apps), non-fungible tokens (NFTs), and other DeFi projects. For these and other reasons, Ethereum remains a crypto industry leader, pointing to some of the reasons investors may consider crypto.

As of February 7, 2023, ETC was the #23 largest cryptocurrency, with a price of $22 and a market cap of just over $3.1 billion. By comparison, Ethereum (ETH) is the second-largest cryptocurrency with a price of $1,638 and a market cap of about $200 billion. Both tokens can be traded as speculative assets and both are listed on many of the most popular crypto exchanges.

Bitcoin remains the oldest and still the largest cryptocurrency, with a market cap of $442 billion, as of February 7, 2023.

What Is a Smart Contract?

A smart contract is an agreement between two parties written in code. The blockchain will execute the terms of the contract automatically, when certain conditions agreed upon by the two parties are met.

Because blockchain technology is also immutable (a blockchain’s records cannot be changed, at least in theory), smart contracts create many opportunities for businesses to do things faster, more efficiently, and in a way that doesn’t require the time and money costs of third-party oversight.

Smart contracts are a critical part of how crypto works. Many different types of cryptocurrencies can use smart contracts, but Ethereum was the first and remains the most prominent leader in the space.

How Ethereum Classic Works

Ethereum Classic is the original Ethereum, and still adheres to the rules and functions of the original Ethereum blockchain. As such, the upgrades that have been implemented over time, leading to Ethereum’s current incarnation (Ethereum 2.0), are not compatible with Ethereum Classic.

Accordingly, Ethereum Classic retains a proof-of-work consensus mechanism, in which miners can generate additional ETC through crypto mining.

Ethereum Classic also doesn’t adhere to the ERC20 token standard. The primary purpose of ERC20 tokens is to work with smart contracts and define a common list of rules that all tokens on the Ethereum blockchain abide by.

Ethereum Classic History

The history of Ethereum Classic is complicated and technical. A simplified summary of the altcoin might go something like this:

• Developers created the DAO, or decentralized autonomous organization, on Ethereum with the goal of funding future development of decentralized applications.

• The DAO had its own tokens that were interchangeable with ETH tokens and executed contracts using proof-of-work.

• In 2016, after hackers took advantage of a flaw in the DAO smart contract and stole $50 million worth of ETH, the community decided that the network would create a hard fork to solve its security challenges.

• The new blockchain, created as a result of the fork, would be called Ethereum. Ethereum began a bigger evolution in 2021 and shifted to proof-of-stake consensus algorithm in 2022. The old blockchain is called Ethereum Classic.

Difference Between Ethereum 2.0 and Ethereum Classic

If you’re looking to build a well-balanced crypto portfolio, you probably want to choose one but not both Ethereum and Ethereum Classic.

While the Ethereum 2.0 and Ethereum Classic networks allow software developers to use smart contracts to build applications, one advantage of Ethereum 2.0 is that it has a larger market cap and user base than Ethereum Classic. This may make ETH less volatile overall. Certainly the token has higher liquidity, and is more popular on exchanges.

ETH also has the added use case of being fuel or “gas” for decentralized applications (dApps). Many developers build decentralized finance (DeFi) protocols on top of Ethereum.

To use those kinds of apps, users need ETH tokens. Sometimes ETH is the only token that users can exchange for other tokens necessary for participating in the platform. Other times, dApps require small amounts of ETH to perform certain functions.

For example, Crypto Kitties was one of the first big decentralized applications, or dApps. The game allowed users to buy, sell, and trade virtual cats that could be “bred” with one another, creating new, unique virtual cats. To participate in the game, users needed ETH tokens.

Ethereum 2.0 also has stronger support from something called the Enterprise Ethereum Alliance, which counts many large companies among its members.

Choosing Which Ethereum to Invest in

If you want to invest in one of the two Ethereums — Ethereum 2.0 or Ethereum Classic — the decision will ultimately come down to your personal preferences and goals as an investor. As discussed, the two are similar, but there are some stark differences that may make one more attractive than the other.

For the average crypto investor, though, it may make sense to stick to the larger cryptocurrency, which is Ethereum 2.0. It has more liquidity and a larger market cap, which might make it a more attractive choice. On the other hand, if you’re interested in being able to mine crypto, Ethereum Classic may be more suited to your tastes.

Price of Ethereum Classic vs Ethereum 2.0

In terms of price or value, Ethereum 2.0 (ETH) is more valuable than Ethereum Classic (ETC). As noted above, Ethereum 2.0 tokens were trading for roughly $1,638 each as of Feb. 7, 2023. That is down significantly from its all-time high of more than $4,600 in the fall of 2021.

Ethereum Classic, conversely, trades for around $22. That, too, is far off its all-time high, which was around $120 in the spring of 2021.

The Future of Ethereum Classic

What is the future of Ethereum Classic? It’s hard to say.

Looking at Ethereum Classic vs. Ethereum 2.0, it’s not hard to see that Ethereum appears to have better prospects for the future. For instance, there’s more trust in the ETH network, it has more backing, and it has a much larger market cap when compared to the Ethereum Classic value. There are also a lot of DeFi platforms and other dApps built on Ethereum 2.0 — more so than on any other smart contract platform.

To make matters worse, the Ethereum Classic network has suffered several 51% attacks. This can happen when attackers gain enough hashing power to control the majority of the network. Then they can alter the blockchain, leading to potential problems like double spent transactions, where users can send the same coins more than once.

The Takeaway

Ethereum Classic is the original version of Ethereum, which itself has undergone several upgrades and is now Ethereum 2.0. The two are similar, and have their roots on the same Ethereum blockchain, but now are two different cryptocurrencies entirely, operating on their own blockchains.

Ethereum Classic still adheres to the original Ethereum’s standards and protocols, including its proof-of-work consensus mechanism. Ethereum 2.0, on the other hand, has adopted new and improved standards, including a proof-of-stake model. It’s also vastly more popular and valuable.

FAQ

Is Ethereum Classic the same as Ethereum?

No, Ethereum Classic is its own project on a separate blockchain network, that adheres to the original Ethereum’s standards and protocols. It’s more accurate to say that Ethereum 2.0 is the “original” Ethereum, as it is the old Ethereum having undergone upgrades and updates.

Which is better: Ethereum 2.0 or Ethereum Classic?

It’s impossible to say which is better, as that’s a subjective call. But Ethereum 2.0 has many advantages over Ethereum Classic, since it’s bigger, more widely used, and more valuable. But prospective miners may give Ethereum Classic the edge.

Is there a future for Ethereum Classic?

Ethereum 2.0 appears to be winning over more investors and market participants. Ethereum Classic is still one of the largest crypto, however, so it’s not time to rule it out.

Photo credit: iStock/MStudioImages

SoFi Invest®

INVESTMENTS ARE NOT FDIC INSURED • ARE NOT BANK GUARANTEED • MAY LOSE VALUE

SoFi Invest encompasses two distinct companies, with various products and services offered to investors as described below: Individual customer accounts may be subject to the terms applicable to one or more of these platforms.
1) Automated Investing and advisory services are provided by SoFi Wealth LLC, an SEC-registered investment adviser (“SoFi Wealth“). Brokerage services are provided to SoFi Wealth LLC by SoFi Securities LLC.
2) Active Investing and brokerage services are provided by SoFi Securities LLC, Member FINRA (www.finra.org)/SIPC(www.sipc.org). Clearing and custody of all securities are provided by APEX Clearing Corporation.
For additional disclosures related to the SoFi Invest platforms described above please visit SoFi.com/legal.
Neither the Investment Advisor Representatives of SoFi Wealth, nor the Registered Representatives of SoFi Securities are compensated for the sale of any product or service sold through any SoFi Invest platform.

Crypto: Bitcoin and other cryptocurrencies aren’t endorsed or guaranteed by any government, are volatile, and involve a high degree of risk. Consumer protection and securities laws don’t regulate cryptocurrencies to the same degree as traditional brokerage and investment products. Research and knowledge are essential prerequisites before engaging with any cryptocurrency. US regulators, including FINRA , the SEC , and the CFPB , have issued public advisories concerning digital asset risk. Cryptocurrency purchases should not be made with funds drawn from financial products including student loans, personal loans, mortgage refinancing, savings, retirement funds or traditional investments. Limitations apply to trading certain crypto assets and may not be available to residents of all states.

Terms and conditions apply. Earn a bonus (as described below) when you open a new SoFi Digital Assets LLC account and buy at least $50 worth of any cryptocurrency within 7 days. The offer only applies to new crypto accounts, is limited to one per person, and expires on December 31, 2023. Once conditions are met and the account is opened, you will receive your bonus within 7 days. SoFi reserves the right to change or terminate the offer at any time without notice.

First Trade Amount		Bonus Payout
Low	High	Bonus Payout
$50	$99.99	$10
$100	$499.99	$15
$500	$4,999.99	$50
$5,000+		$100

SOIN1222005

Jan

2023

Promotional Certificate of Deposit (CD): How It Works

Understanding Promotional Certificate of Deposit (CD) Rates

By Caroline Banton | Growing Wealth, Investing, money | Comments Off

There’s a good chance that you’re familiar with certificates of deposit, or CDs, a financial product that typically pays a fixed interest rate if you keep your funds on deposit for a specific period of time. Sometimes, though, you may encounter an offer for a promotional CD, or bonus CD. This is a type of savings account offered by a bank or credit union for a short time, usually with a higher interest rate, to entice new deposits.

As with standard certificates of deposit, interest is earned on the funds that the account holder agrees to invest. This interest accrues until the CD matures, or reaches its maturity date, which is usually in several months or a few years. Because CDs are insured up to $250,000, they can offer a secure way to grow one’s money.

Promotional CDs can sweeten the deal by offering a higher-than-normal interest rate. That said, they may also require a higher initial deposit or a longer term in order to snag that loftier return.

Is a promotional or bonus CD right for you? Read on to learn:

• What is a promotional certificate of deposit?

• What are the pros and cons of a promotional CD?

• When do promotional CDs make sense?

• Are bonus CDs worth it?

What Is a Promotional CD?

A promotional CD is a timed deposit account, similar to a regular CD, but offered with more advantageous terms, such a higher rate. However, there’s usually a requirement or condition to nab that rate, such as making a larger deposit, keeping the funds on deposit longer, or already being a client of the bank.

Banks and credit unions offer these accounts to attract new investors and build capital, which they can then invest at a higher rate elsewhere. Just like regular CDs, promotional CDs usually earn interest on the deposited amount at a set rate until maturity. Most CD accounts are insured by the FDIC or NCUA (Federal Deposit Insurance Corporation or the National Credit Union Administration), depending on whether the money is on deposit at a bank or credit union.

Because there are a wide variety of CDs — including jumbo CDs and brokered CDs, and more — it’s wise to explore the exact terms of the CD you’re interested in, including interest rates, fees, and other stipulations.

How Does a Promotional CD Rate Work?

As noted above, CD promotional rates can be used to attract new investors and to build capital that they can then invest elsewhere at a higher interest rate. Promotional CDs will probably have better rates than a regular savings or CD account, but they may also require a higher initial deposit (perhaps closer to that of a jumbo CD) or longer term.

Like any CD these are low-risk investments, so generally the returns will be lower than other investments, like stocks. While bonds are also generally lower-risk vehicles, and bonds can seem similar to CDs in that they pay a fixed rate, the typical rate on a CD is often lower than a bond.

At maturity, promotional CDs are often rolled over into another CD that pays a lower interest rate, or they can be cashed out. Some banks might offer a higher rollover rate to retain the investment. The financial institution will generally charge a fee if an account holder withdraws the funds before the maturity date (there are no-penalty CDs, but they tend to pay a lower interest rate).

Recommended: What Is a Variable Rate CD?

Example of a Promotional CD Rate

Let’s say an investor wants to set up a certificate of deposit investment plan. They invest $5,000 in a CD for five years. A bank that offers a five-year promotional CD with a competitive 4% annual percentage yield (APY) would provide earnings of around $1,083. A regular savings account with a lower rate of 3.5% would earn about $938 with the same $5,000 deposit, or almost $150 less.

When to Consider Opening a Promotional CD?

A promotional CD makes sense when a bank or credit union is offering a better interest rate than a regular CD or savings account, you have the required amount to invest, and you don’t need the funds for the length of the CD term. While it’s impossible to say for sure which investments are the safest, if you’re worried about the higher risk associated with investing in assets like stocks or bonds, a promotional CD is a reasonably safe investment.

For example, CDs are sometimes used as college savings accounts or when parents are thinking about how to create an investment plan for a child.

How to Get a Promotional (Bonus) Rate CD

If you’re in the market for a promotional or bonus rate CD, follow these steps:

• Do a bit of research to see what may be offered. Often, the best or only deal is what your bank may offer you.

• Read the fine print. Make sure you qualify for the account and fully understand the term, the rate, and penalties for early withdrawal, among other features.

• Apply for the CD when you are ready to invest, and set up funding to transfer money into your new CD account.

When a Promotional CD Does Not Make Sense

Now that you know how certificate of deposit promotions work, consider whether it’s really the right move for you. A promotional CD does not make sense if you may need the funds before the maturity date of the CD. The bank or credit union will likely charge a fee if you withdraw your funds early. In some cases, you might want to consider a no-penalty certificate of deposit.

Also, CDs do not keep up with inflation, so once taxes are paid on the interest earned, there may not be much of a return on the investment. If you want to explore other ways to earn interest, you might consider high-yield savings or fixed-income investment.

The Pros of Promotional CD Rates

The main advantages of promotional CDs are that they are safe and predictable.

• Promotional CDs, like regular CDs, are likely a safe investment with a guaranteed rate of return.

• Funds are typically insured by the FDIC up to $250,000.

• The interest rate is usually fixed for the life of the CD, which helps to predict income.

The Cons of Promotional CD Rates

The main disadvantages of promotional CDs are that they do not offer high returns because they are low-risk.

• The promotional rate is generally only offered for shorter maturity terms, and the rollover option is often to a standard CD at a lower rate (not the promotional rate).

• Promotional CDs often require a larger initial deposit.

• Promotional CDs may demand a longer term.

• These financial products may only be available to current clients of a specific financial institution.

Promotional CD Rates vs Regular CD Rates

Promotional CD rates pay depositors a premium for parking their funds into a particular financial institution. The exact APY offered will depend on the bank, the length of the term, and the amount deposited. Most promotional CDs are shorter-term: e.g. about a year or less. Rates as of January 27, 2023 might be as high as 5.5% (the higher rates are likely to be offered by an online bank vs. a traditional bank or at a credit union).

Rates ranged from about 4.25% at CapitalOne, 0.02% at Chase, and 0.03% at Bank of America for CDs of a year or two in length with a deposit of less than $10,000.

Are Promotional CD Rates Worth It?

Do your research and think seriously about financial security as you consider a certificate of deposit promotion. A couple of points to recognize:

• When interest rates are down, investing in the stock market using an IRA or 401(k) may make more sense than a CD in terms of helping your money grow, though investing carries risk.

• Promotional CDs are often offered by banks with low interest rates overall, and what one bank considers a competitive rate might be much lower than other banks’ standard rates. In other words, if a financial institution is offering an additional 0.05% for opening a new CD, but their base APY is very low, it’s likely not the best deal for you.

The Takeaway

For risk-averse investors who want to invest a sum of money safely and know exactly what return they can expect, a promotional CD can be a good option. It’s a way to take advantage of temporary favorable interest rates offered by a bank or credit union that can yield a higher return than a simple savings account.

That said, there are also some savings accounts that offer higher rates and could be the right place to stash your cash. When you open an online bank account with SoFi, you can qualify for a competitive APY when you set up direct deposit. In addition, these innovative, all-in-one accounts offer all the convenience of spending and saving in one place with no minimum balance requirement or account fees.

Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.20% APY on SoFi Checking and Savings.

🛈 While SoFi does not offer Certificates of Deposit (CDs), we do offer alternative savings vehicles such as high-yield savings accounts.

FAQ

Can a certificate of deposit be discounted?

CDs are not sold at a discount, unlike other short-term money market instruments. CDs pay interest on the money deposited usually on an annual basis. For CDs with a maturity of less than one year, interest is paid at maturity, and taxes are due on the earnings each year. However, for investors who don’t need to receive interest payments each year, a zero-coupon CD provides a return by being sold for their face value at maturity, which is higher than the initial investment.

What is the typical interest rate for a certificate of deposit?

A typical interest rate for a CD could range from 0.03% to 5+% for CDs with a one-to-five-year term and deposit of less than $10,000. It depends on the bank and the terms. CD rate promotions typically add to these rates.

What is the typical minimum balance for a certificate of deposit?

A typical minimum balance for a CD ranges from $500 to $5,000 or more, depending on the CD and the bank. Jumbo CDs typically require a $50,000 or higher deposit. Some banks offer CDs with no minimum balance requirement.

Photo credit: iStock/Ridofranz

SoFi members with direct deposit activity can earn 4.20% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate. SoFi members with direct deposit are eligible for other SoFi Plus benefits.

As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant. SoFi members with Qualifying Deposits are not eligible for other SoFi Plus benefits.

SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.20% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.

Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.

Interest rates are variable and subject to change at any time. These rates are current as of 10/31/2024. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2024 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

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

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

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.

SOBK0123034

Jan

2023

Is Mining Cryptocurrency Worth It in 2021?

Is Crypto Mining Still Profitable in 2023?

By Brian Nibley | Growing Wealth, Investing | Comments Off

Crypto mining is still profitable, but it’s potentially not as profitable as it was in years past. That’s true for a number of reasons, including the fact that for most of 2022 and into early 2023, crypto values were down way off their peaks.

Cryptocurrencies generally still have value, but calculating miner profitability can be a bit trickier than before, given the expense of computer hardware and software, as well as the energy it takes to keep that mining equipment running.

As the oldest and largest crypto, Bitcoin uses a proof-of-work consensus mechanism, and as such it is one of the main sources of crypto mining. Before deciding whether Bitcoin mining is worth it, and crypto mining in general, it’s important to know how it works and what the pros and cons are.

Table of Contents

Why Bitcoin Mining Exists
How Much Does a Miner Earn?
Bitcoin Mining Advantages and Disadvantages
The Risks of Crypto Mining
Bitcoin Mining Pools
How Long Does it Take to Mine 1 Bitcoin in 2023?
How Many Bitcoins Will Be Mined in 2023?
Alternatives to Mining Bitcoin

Why Bitcoin Mining Exists

Mining Bitcoin isn’t just the creation of Bitcoin (BTC). It’s also the decentralized global system by which miners validate and secure all Bitcoin transactions — and earn Bitcoin themselves.

It goes back to the blockchain technology that Bitcoin and other cryptocurrencies are built on. To run these networks, miners rely on powerful computer systems — or in some cases cloud-based technology — to solve complex mathematical puzzles and validate blocks of digital transactions.

This system is known as proof-of-work (PoW). With Bitcoin and other PoW systems, every transaction gets recorded in a transparent, immutable, public ledger known as the blockchain. The miner/s who solved it get rewarded with new Bitcoin.

What Is Bitcoin Halving?

It takes about 10 minutes for miners to confirm a 1MB block of transactions and earn new Bitcoin. But remember mining is intensely competitive, especially because the reward is halved every 210,000 blocks and now stands at 6.25 BTC.

As more Bitcoins are mined and the supply of new Bitcoins drops, the amount of Bitcoins released with every new block diminishes over time. This is known as Bitcoin halving, and generally, the value of Bitcoin increases after periodic Bitcoin halving.

So, to sum it all up, mining serves the purpose of validating a crypto network, and generating rewards for network participants, sometimes called validators or miners.

How Much Does a Miner Earn?

As of January 2023, a Bitcoin miner that successfully validates a new block on Bitcoin’s blockchain will earn 6.25 BTC. That reward will be reduced, however, during the next halvening.

And remember, Bitcoin is a deflationary cryptocurrency — so fewer BTC are produced every year, until the total amount of 21 million BTC is mined. If miners are working in teams or in pools, however, that reward is split up between them, too.

Hurdles to Mining BTC

While Bitcoin mining may seem lucrative, there are some caveats. For instance, to mine crypto effectively and efficiently, specialized machines built and tuned specifically to mine cryptocurrencies are often required. It also requires space — and a great deal of energy — to house and cool these powerful machines that operate around the clock.

There’s also competition to consider: The mining market is dominated by large companies who secure large warehouse facilities to house their army of ASIC mining rigs. Some of these companies might run mining pools that smaller miners can contribute to in order to get a piece of some block rewards in exchange for a small fee.

This is all to say that today, mining Bitcoin as an individual is rarely profitable unless someone has access to extra low-cost electricity and affordable equipment.

Bitcoin Mining Advantages and Disadvantages

Here are some positive and negative aspects of mining crypto.

Advantages

• Proven track-record. Proof-of-work (PoW) consensus algorithms, which are the basis for crypto mining, have been around for many years. During that time, the Bitcoin network hasn’t seen a significant security problem.

Many in the industry believe this is a result of Bitcoin’s significant hash rate, which refers to the amount of computing and process power being contributed to the network through mining.

In the past, hackers have been able to destabilize smaller PoW networks, although the same can be said for smaller proof-of-stake (PoS) networks.

• Cryptographic security. When trusting a network with large sums of money, PoW might be the best bet. It’s difficult to attack a PoW blockchain, so much so that would-be hackers are often content to become honest miners instead.

Disadvantages

• Energy usage. Bitcoin mining uses a lot of electricity. Critics point to this as the main flaw of PoW. It’s possible that the Bitcoin network uses as much energy as an entire small country. Although Bitcoin’s overall energy usage is decreasing and much of it now comes from sustainable sources, this is still a primary concern.

• Barriers to entry. PoW mining becomes more difficult with time, making it harder for the average person to get involved. A major principle of a decentralized PoW network is to distribute tasks as well as profits among many users. But as mining becomes more complex and difficult, a handful of large companies — which can afford to build warehouses full of mining machines — dominate the mining sphere.

Crypto Mining Advantages	Crypto Mining Disadvantages
Proven track record	High energy usage
Cryptographic security	Greater barrier to entry
Difficult to attack	Gets more difficult over time

The Risks of Crypto Mining

While crypto mining can be profitable in some instances, it does have its risks and downsides. Here’s a brief rundown.

Environmental Risks:

As mentioned, crypto mining is resource-intensive. Running mining rigs eats up a lot of electricity, which, in turn, generates environmental pollution.

Security Risks:

Malware and other security risks exist in the mining sphere, too. For instance, it’s possible that bad actors could use techniques (like phishing) to access someone’s computer, and then load mining codes and programs onto it without them knowing. As such, the victim could be sharing their computing resources and electricity mining with a hacker without even realizing it.

Regulatory Risks:

Regulation has yet to make it to the crypto space, but the federal government is working on it, and anyone involved in crypto can probably expect new rules and regulations to be announced within a few years. Those new rules and regulations will likely affect miners, too, so that’s another thing to keep in mind.

Investment Risk:

Crypto mining requires some upfront investment. You’ll need to buy a “rig,” first and foremost, and stocking up on computer power isn’t always cheap. But, as with any investment, there are risks in doing so. Mining may not be as profitable in the future, meaning your investment may not earn you the types of returns you were hoping for.

Or, if new regulations make mining illegal (though there’s no indication that will happen), investing in mining equipment may have all been a sunk cost.

Bitcoin Mining Pools

Due to the high cost and rising difficulty of mining Bitcoin, most miners today use something called a mining pool, as mentioned previously. Participating in mining pools is considered by many to be the only way for smaller miners to make any profit today, and even then it can be difficult to recoup the costs of equipment and electricity.

Within a mining pool, individual miners pool their resources together with other miners, improving their chances of mining a block and earning the Bitcoin rewards. When a block gets mined, the rewards are then split up among the different miners in proportion to the amount of computing power (known as hashing power) they contributed.

Mining pool owners typically charge mining fees for maintaining and participating in the pool. There are several different pools to choose from, each with their own structure.

Further, there are also Bitcoin cloud mining opportunities out there, which effectively allow miners to use computing resources over the internet. Miners using this strategy are renting others’ equipment, which incurs more costs.

Factors to Consider When Choosing a Mining Pool

After securing the Bitcoin mining equipment and electricity required for mining, a small miner will need to find a suitable mining pool. There are a few important factors to consider:

• Fees: Most, but not all, Bitcoin mining pools charge fees. The fees are taken from the reward payout and can be as high as 4%.

• Pool size: The larger the pool, the more frequent the potential payout, as more hashing power equals more blocks being found. However, this also means that the payouts are smaller, since rewards are shared between more people. On the flip side, smaller pools pay out less frequently, but in larger amounts.

• Security and reliability: Miners might want to find a mining pool that they can trust won’t steal users’ funds or get hacked. Joining established pools with long histories may help to reduce these risks.

• Required equipment investment: You’ll need to bring some power to the pool, too. And it’s becoming increasingly expensive to mine. When Bitcoin was first created, the computer power required for Bitcoin mining was enough for the computer-processing unit (CPU) of an average laptop computer to handle. But over time, the calculations have become more complex. Today, mining can mostly only be accomplished with advanced Application Specific Integrated Circuit (ASIC) machines, created specifically for mining Bitcoin.

And yet the hardware needs of Bitcoin mining is constantly evolving, as older machines become obsolete. An ASIC that was powerful enough to be profitable six months ago might not be able to produce enough coins to match the cost of electricity needed to run that same ASIC today. When this happens, miners must acquire new, more advanced hardware.

If you plan to try Bitcoin mining on your own, here are some things to consider when purchasing equipment:

• Equipment cost

• Electricity cost

• The time it will take to recoup equipment costs

• How BTC price fluctuations might impact profitability

• The frequency with which you will need to buy newer, more powerful machines and sell old ones

How Long Does it Take to Mine 1 Bitcoin in 2023?

There’s no correct answer here: The amount of time it takes to mine one whole bitcoin varies, and depends largely on the amount of hashing power a miner contributes.

In general, the more hashing power, the faster a block will be solved, resulting in the miner reaping the block reward in the form of newly minted bitcoins. Mining difficulty is another important variable. The lower the difficulty, the greater the odds of finding a new block.

When prices rise, more people are generally motivated to mine crypto. Then, as the Bitcoin hash rate increases due to more miners coming online, the difficulty adjustment (which happens every two weeks) tends to increase.

When prices fall, the opposite tends to happen, as the costs of Bitcoin mining equipment and electricity rise in relation to the value of the coins being mined. As hashing power comes offline, the difficulty tends to adjust downward.

How Many Bitcoins Will Be Mined in 2023?

There are about 900 new Bitcoins being mined every day. Assuming that rate held up during the entirety of 2022, then about 328,500 Bitcoin would’ve been mined in total. That should hold true during 2023, too. Roughly speaking, the amount of Bitcoin remaining to be mined totals around 2 million.

The interesting thing to note is that more people mining Bitcoin does not lead to an increase in the number of coins being mined. The block reward is currently set at 6.25 (this will remain true until the next Bitcoin halving), and one block gets mined roughly every 10 minutes. Increased competition for blocks leads to a higher hash rate, but the number of new coins being minted remains the same.

Alternatives to Mining Bitcoin

For those who choose to undertake the cumbersome task of mining crypto, the best cryptocurrency to mine might be the one with the lowest difficulty and highest price. But it’s critical to remember that these dynamics are in a constant state of flux, so the best cryptocurrency to mine today might not be the best one to mine tomorrow.

Historically, the only time altcoin miners have made significant profits has been when they were mining lesser-known, cheaper coins in the weeks and months before a large increase in prices, or an “alt season.” This has happened twice so far — once in 2017 and again in late 2020/early 2021.

Is It Worth Mining Ethereum In 2023?

Ethereum is the crypto market’s second-largest player. But unfortunately for miners, mining is no longer possible on the Ethereum network.

That’s because the “Ethereum 2.0” upgrade has gone into effect, which changed the consensus mechanism for Ethereum from proof-of-work to proof-of-stake. As such, the network no longer utilizes mining.

Only those who hold large quantities of ETH will be able to stake their tokens and become “validators.” Validators will have a chance at winning the next block rewards, with the highest odds going to those with the greatest amount of ETH staked. You can do more research about crypto mining vs. staking to learn more.

The Takeaway

Crypto mining is still profitable in 2023, however, it’s not as profitable as it once was, given that crypto prices have fallen from their peaks, and that mining operations have become more expensive to run and maintain. That’s not to say that prospective miners won’t make a profit, but there are more things to consider than in years past.

With that in mind, mining is a complex operation that carries considerable costs and risks. Most people interested in crypto mining may find it more worthwhile to join a mining pool than to try and go it alone.

FAQ

Is Bitcon mining profitable?

Bitcoin mining can be profitable, but there are many things prospective miners need to take into consideration. Given lower crypto prices and increased costs for equipment and resources, it may not be profitable for everyone.

What is the average profit margin for mining crypto?

It’s difficult, if not impossible to say what the average profit margin for mining crypto is without knowing a miner’s costs for electricity, mining equipment, and more. Those taking part in a mining pool, too, would have different costs to consider as well.

What risks are associated with mining crypto?

Some of the main risks associated with crypto mining include environmental concerns, security risks, investment risks, and regulatory risks. These are all things that any and all miners should take into consideration.

Photo credit: iStock/Chris Tamas

SoFi Invest®

INVESTMENTS ARE NOT FDIC INSURED • ARE NOT BANK GUARANTEED • MAY LOSE VALUE

First Trade Amount		Bonus Payout
Low	High	Bonus Payout
$50	$99.99	$10
$100	$499.99	$15
$500	$4,999.99	$50
$5,000+		$100

SOIN1222002

Jan

2023

What Is Greenwashing?

By Laurel Tincher | Growing Wealth, invest, Investing | Comments Off

Greenwashing is when a company markets itself as more environmentally friendly than it actually is. Also known as “green sheen,” this tactic is used to attract consumers who prefer products with high environmental standards.

The term greenwashing is taken from whitewashing, which is when a company or individual conceals its wrongdoings by presenting a cleaned-up version of their actions that isn’t actually true.

A typical reason companies engage in greenwashing these days is that consumers want to purchase the most sustainable products they can. According to GreenPrint’s 2021 Business of Sustainability Index, 75% of millennials and 64% of Gen X consumers claimed they would spend more money on a more environmentally friendly product.

Before you buy products marketed as sustainable or eco-friendly, or invest in a green company that makes similar claims, it may help to know some of the red flags of greenwashing.

Identifying the Different Types of Greenwashing

There are a few common marketing tactics that constitute greenwashing. Many of these can be convincing, so in order to decide whether a company is engaging in actual greenwashing or not, you may have to do your own research.

Here are some red flags to look out for when purchasing a product, or investing in a company that claims to embrace sustainability or ESG investing (i.e. good environmental, social, and governance practices):

• Vague terminology: Labels such as “eco-conscious,” “clean,” or “100% sustainable” don’t actually mean anything in terms of a company’s manufacturing processes or adherence to environmental policies. Be sure to research terms and standards that reflect actual environmental practices.

• Imagery: If a polluting company uses marketing images of flowers, trees, beaches and so forth, they may be trying to appear more environmentally friendly than they really are. Be sure to check whether the product lives up to the advertising.

• Greenwashing a traditionally polluting product: Companies may attempt to improve the branding of a product by making it seem more environmentally friendly without actually changing much or anything about it.

• False associations: Brands can make it seem like they are endorsed by a third party when they really aren’t, or the third party is simply their own subsidiary.

• Green products from a polluting company: A company might make a product that has a lower environmental impact, such as an electric vehicle, but manufacture it in a way that creates significant waste and greenhouse gas emissions.

• Fabricated data: Companies might fund research that will have results that make them look better, or make data up completely.

Again, because socially responsible investing has grown so rapidly, and many companies want to attract the attention of investors and consumers, there is a commensurate growth on the greenwashing side, so it does pay to be cautious when making choices.

Example of Greenwashing

A few examples of what would be considered greenwashing are described on the U.S. Federal Trade Commission (FTC) website:

• A company labels a trash bag they are selling as “recyclable.” Although this may be true, it’s unlikely that a trash bag full of trash will be emptied and then recycled on its own. This label makes the product appear to have an environmental benefit, but in reality it doesn’t.

• In another example, a company labels a product as having 50% more recycled content than a previous product did. This makes it sound like a significant amount, but in fact the company may have increased the recycled content from 2% to only 3%, so there has been hardly any change in reality.

• A company labels a product as “recyclable” but they don’t say specifically whether all parts of it are recyclable, just some parts, or just the packaging.

Other real-world examples include: an oil company that’s known for environmental negligence releasing advertisements that state their dedication to the environment — or companies promising to do environmental cleanups, but failing to actually follow through on those promises. You can compare these to alternative or solar energy companies that are making a difference.

💡 Recommended: A Beginner’s Guide to Invest in Solar Energy

The Negative Effect of Greenwashing on a Company

Although in the short term greenwashing can benefit a company if it leads to more people buying their products, there can be negative consequences. If consumers realize the company is engaging in greenwashing there can be a big PR backlash. Companies can also face legal ramifications for their misleading claims. And investors interested in true impact investing may take their business elsewhere.

In the long term, the biggest negative consequence is the actual environmental impact of manufacturing practices that are not, in fact, green or sustainable. Companies rely on clean water and air, quality soil, and a stable climate to operate. A thriving economy requires a healthy planet, and greenwashing ultimately doesn’t support either.

How to Avoid Greenwashing

Whether purchasing products or investing in companies, if you are looking for the most sustainable options, there are a few ways to avoid greenwashing.

1. Clear and Transparent Language

Watch out for vague terms and language. If a brand makes sustainability claims, look for specifics such as certifications, verifiable third-party endorsements, industry credentials, and details about exactly what the brand is doing.

2. Evaluate the Data

If a brand uses statistics and numbers to back up its sustainability claims, make sure they are backed up with credible data.

3. Compare Similar Products

A company may make sustainability claims when in fact their product has basically the same environmental impact as their competitor’s. Compare ingredients, packaging, and manufacturing information to see whether one product is really better than another.

4. Look Beyond the Final Product

Even if a company is improving the impact of its products, it may not be addressing the waste and emissions associated with its operations. If this is the case, they may be just making changes for marketing purposes. Check out their website and other materials to see how much effort is going into sustainability at the corporate level.

5. Look for Goals and Timelines

If a company is truly implementing a comprehensive sustainability plan, it would include measurable goals and timelines. Ideally those are shared with consumers at least to some extent.

6. Check Ingredients and Materials

Some terminology and product labels can be misleading. For instance, a company might say that their product is made from organic cotton or recycled plastic, when in fact only a small percentage of the cotton or plastic is organic or recycled and the rest is not. The FDA has no guidelines for what the term “natural” means, and according to the USDA the term simply means that a product is “minimally processed” with “no artificial ingredients.”

Greenwashing vs Green Marketing

There is nothing wrong with a company telling the story of its environmental initiatives and the steps it is taking to produce products more sustainably. That’s green marketing at its best and most transparent. By contrast, greenwashing is when a company attempts to cover up their bad practices using fake versions of legitimate claims.

Actual green marketing may include:

• Certifications and endorsements from established regulatory organizations

• Clearly labeled manufacturing processes

• Recyclable, compostable, or biodegradable materials (but watch out for these labels, sometimes a product can actually only be composted or biodegrade in very specific conditions that aren’t realistic).

• Products free from toxic chemicals

• Use of renewable energy

• Transportation measures such as EVs

• Purchase of carbon offsets for any unavoidable emissions

• In-office programs and measures such as renewable energy, LEED certified buildings, on-site composting, or elimination of single use plastic

• Doesn’t use too much packaging, and ideally avoids plastic packaging

• Circularity programs that allow consumers to send back the product for repair or reuse

• High-quality manufacturing made to last rather than one-time or short-term use

• Fair trade and ethical labor practices

• Environmental programs outside the company, such as donations or volunteer efforts

The Takeaway

Greenwashing is a marketing tactic some companies use to align themselves with the growing consumer and investor desire for sustainable products and investments. It’s related to the concept of “whitewashing,” which means covering up the truth with a positive-sounding story.

Greenwashing can take a number of different forms, including imagery that appears eco-friendly (but doesn’t reflect anything about the actual product), advertising and marketing language that is misleading, or the greenwashing of traditional pollutants (e.g. fossil fuels and the like).

Ready to invest in your goals? It’s easy to get started when you open an investment account with SoFi Invest. You can invest in stocks, exchange-traded funds (ETFs), mutual funds, alternative funds, and more. SoFi doesn’t charge commissions, but other fees apply (full fee disclosure here).

Take a step toward building your portfolio with SoFi Invest®.

FAQ

What is ESG greenwashing?

ESG greenwashing is the practice of using marketing tactics to exaggerate sustainability efforts in order to attract customers, employees, investors, or positive media attention.

What are the three most common kinds of greenwashing?

Three common types of greenwashing are the use of environmental imagery, misleading labels and language, and hidden tradeoffs where the company emphasizes one sustainable aspect of a product but they also engage in environmentally damaging practices.

Photo credit: iStock/fizkes

SoFi Invest®

INVESTMENTS ARE NOT FDIC INSURED • ARE NOT BANK GUARANTEED • MAY LOSE VALUE

SOIN0522005

All About $15,000 Personal Loans

What Is the Required Credit Score for a $15,000 Personal Loan?

Benefits of a $15,000 Personal Loan

Interest Rates and Flexible Terms

No Collateral Required

Fixed Monthly Payments

Cons of a $15,000 Personal Loan

Taking on Debt

Higher Payments Than Credit Cards

Origination Fees and Prepayment Penalties

Interest Rates May Be Higher Than Other Options

Where Can I Get a $15,000 Personal Loan?

How to Get a $15,000 Personal Loan

1. Check Your Eligibility

2. Get Pre-qualified

3. Check the Terms

4. Apply for the Loan

Applying for Other Small Loan Amounts

$5,000 Personal Loans

$10,000 Personal Loans

$20,000 Personal Loans

The Takeaway

FAQ

What credit score is needed for a personal loan for $15,000?

How long can I get a $15,000 personal loan for?

What would payments be on a $15,000 personal loan?

Ethereum Classic vs Ethereum 2.0: What’s the Difference?

What Is Ethereum 2.0 (ETH)?

History of Ethereum 2.0 and Ethereum Classic

What Is Ethereum Classic (ETC)?

What Is a Smart Contract?

How Ethereum Classic Works

Get up to $1,000 in stock when you fund a new Active Invest account.*

Access stock trading, options, alternative investments, IRAs, and more. Get started in just a few minutes.

Ethereum Classic History

Difference Between Ethereum 2.0 and Ethereum Classic

Choosing Which Ethereum to Invest in

Price of Ethereum Classic vs Ethereum 2.0

The Future of Ethereum Classic

The Takeaway

FAQ

Is Ethereum Classic the same as Ethereum?

Which is better: Ethereum 2.0 or Ethereum Classic?

Is there a future for Ethereum Classic?

Understanding Promotional Certificate of Deposit (CD) Rates

What Is a Promotional CD?

How Does a Promotional CD Rate Work?

Example of a Promotional CD Rate

When to Consider Opening a Promotional CD?

How to Get a Promotional (Bonus) Rate CD

When a Promotional CD Does Not Make Sense

The Pros of Promotional CD Rates

The Cons of Promotional CD Rates

Promotional CD Rates vs Regular CD Rates

Are Promotional CD Rates Worth It?

The Takeaway

FAQ

Can a certificate of deposit be discounted?

What is the typical interest rate for a certificate of deposit?

What is the typical minimum balance for a certificate of deposit?

Is Crypto Mining Still Profitable in 2023?

Why Bitcoin Mining Exists

What Is Bitcoin Halving?

How Much Does a Miner Earn?

Hurdles to Mining BTC

Bitcoin Mining Advantages and Disadvantages

Advantages

Disadvantages

The Risks of Crypto Mining

Environmental Risks:

Security Risks:

Regulatory Risks:

Investment Risk:

Bitcoin Mining Pools

Factors to Consider When Choosing a Mining Pool

Get up to $1,000 in stock when you fund a new Active Invest account.*

Access stock trading, options, alternative investments, IRAs, and more. Get started in just a few minutes.

How Long Does it Take to Mine 1 Bitcoin in 2023?

How Many Bitcoins Will Be Mined in 2023?

Alternatives to Mining Bitcoin

Student Loan
Refinancing

Personal
Loans

Online
Investments