A health maintenance organization, or HMO, is a type of health insurance plan that typically offers lower premiums and out-of-pocket costs in exchange for members using the plan’s network of providers.
That network is usually confined to a certain city or geographic area.
An HMO can be a good choice for healthy people who don’t anticipate needing a lot of specialized care in the coming year.
However, these plans tend to offer less flexibility in where you can go for care than other types of health plans, such as preferred provider organizations (PPOs).
Read on to learn if an HMO could be the right plan for you and your family.
How Do HMOs Work?
HMOs contract with a group of doctors, hospitals, and other healthcare providers within a certain area for a negotiated fee.
In return for accepting lower payments, HMOs offer providers a steady stream of patients. Insurers can then pass the savings onto patients in the form of lower premiums and out-of-pocket costs.
To take advantage of these lower costs, HMO members must, for the most part, receive care only from network providers.
This starts with your primary care physician (PCP). HMO members typically should choose a PCP from the plan’s network. Your PCP takes care of annual check-ups and other medical needs that require an office visit.
In an HMO, your PCP is typically also the gatekeeper for your other health needs. To see a specialist, such as a podiatrist or a dermatologist, you would likely need to first visit your PCP to get a referral to a specialist within the network.
There are often some exceptions to network-only care, however. Emergency care received out-of-network is usually covered. And, with some preventive care services, such as mammograms and gynecological visits, you may be able to see a network doctor without first getting a referral.
In cases where you may have a serious health condition requiring a specialist not included in the network, the HMO may cover that treatment as long as you request pre-approval.
In addition to low premiums, there are often low or no deductibles with an HMO. Instead, the plan will typically charge a copayment, or copay, for each clinical visit, test, or prescription.
How Do HMOs Compare With Other Types of Health Insurance?
Another commonly available health plan offered by employers and health insurance companies is a preferred provider organization, or PPO. These plans have many features in common with HMOs, but also a few key differences.
As with an HMO, members of a PPO plan have access to a network of providers. When they use providers within that network, they will typically pay less out-of-pocket costs, such as copays.
Unlike an HMO, however, care outside of the network is usually also covered, but at an additional cost.
How much the PPO will pay for an out-of-network doctor may be capped at what the PPO deems the “customary and usual” payments for providers in your area. Depending on where you live, that could mean a small or potentially large additional out-of-pocket cost.
Depending on where you live, that could mean a small or potentially large additional out-of-pocket cost.
Another key difference between these two types of plans: With a PPO, you typically do not need a referral to see a specialist, either within or outside of the network.
In addition, PPO plans usually have deductibles, while some HMOs do not. PPO plans also typically have more expensive premiums than HMOs.
However, not having to see your PCP (and pay a copay) to get a referral to a specialist can be a cost saver for members of PPOs.
💡 Quick Tip: Next time you review your budget, consider making room for additional insurance coverage. Think of it as an investment that can help protect you from a major financial loss.
The Pros and Cons of HMOs
It can be a good idea to weigh the advantages and disadvantages of HMOs before you choose a plan, just as you would with any other option.
Here are some of the most common pros and cons.
Advantages of HMOs
• Lower costs. Premiums, deductibles, and copays are usually lower with an HMO compared to other types of health care plans. Some plans even have no deductible. Your out-of-pocket costs will also likely be lower for your prescriptions.
• Less paperwork. Because your care is managed through your PCP and you are receiving care through the HMO network, billing tends to be less complicated for those with an HMO.
• Care is often high quality. Because preventive services are generally fully covered and because your PCP can act as your advocate for early intervention medical care, many people find HMOs provide good quality of health care.
Disadvantages of HMOs
• Provider Restrictions. With an HMO, you must choose a primary care physician from the plan’s network. This doctor will manage your care and refer you to specialists within the network. If your current doctor is not in the HMO network, you would likely need to switch.
• Restricted emergency care. Emergency care is usually covered even if it is received from out-of-network providers. But HMOs often have strict rules on what constitutes an emergency and which emergency providers will be covered.
• Geographic restrictions. Because HMO networks are usually located within one geographic area, your network of providers will only be available within that location. That means if you’re traveling and you need medical care, those bills may not be covered, unless it is an emergency. Also, dependent college children who attend school out of state are usually not covered.
The Takeaway
HMO plans can be a very efficient, low-cost way to manage your health care needs. These plans can foster a close relationship with your primary care physician, who can help you navigate both preventive and specialty care.
Some consumers feel the restrictions on receiving care from out-of-network providers and the hassles of getting a referral can be an obstacle to optimal care.
HMOs are often compared to PPOs, which generally allow members more freedom to see out-of-network providers (though going out of network may cost more). PPOs typically don’t require referrals to see specialists.
To determine which type of health plan is best for you, you’ll likely want to weigh the costs and plan offerings against your budget and health needs. Before choosing a plan, it might also be helpful to track your spending for a few months to see how much you are currently spending on medical care.
When the unexpected happens, it’s good to know you have a plan to protect your loved ones and your finances. SoFi has teamed up with some of the best insurance companies in the industry to provide members with fast, easy, and reliable insurance.
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You probably have things you want to do with your money down the road: buy a house, save for retirement, fund college for your kids, maybe even go on a big trip or do a major remodel. And you may be wondering if investing can help you achieve those goals.
It’s never too early or too late to start investing. There are a number of different ways you can put your money to work, including choosing different investment types.
9 Types of Investments
Before deciding on your investments, ask yourself what your financial goals are. Then try to build a portfolio that achieves those goals, balancing risk with return and maintaining a diverse mix of assets.
When you think of investing and investment types, you probably think of the stock market. They are, essentially, investment fund basics. A stock gives an investor fractional ownership of a public company in units known as shares.
Only public companies trade on the stock market; private companies are privately owned. They can sometimes still be invested in, though the process isn’t always as easy and open to as many investors.
A stock makes money in two ways: It could pay dividends if the company decides to pay out part of its profits to its shareholders, or an investor could sell the stock for more than they bought it.
Some investors are looking for steady streams of income and therefore pick stocks because of their dividend payments. Others may look at value or growth stocks, companies that are trading below their true worth or those that are experiencing revenue or earnings gains at a faster pace.
Pros and Cons of Stock Investments
Pros
Cons
If the stock goes up, you can sell it for a profit.
There are no guaranteed returns. For instance, the market could suddenly go down.
Some stocks pay dividends to investors.
The stock market can be volatile. Returns can vary widely from year to year.
Stocks tend to offer higher potential returns than bonds.
You typically need to hang onto stocks for many years to achieve the highest potential returns.
Stocks are considered liquid assets, so you can typically sell them quickly if necessary.
You can lose a lot of money or get in over your head if you don’t do your research before investing.
2. Bonds
Bonds are essentially loans you make to a company or a government — federal or local — for a fixed period of time. In return for loaning them money, they promise to pay it back to you in the future and pay you interest in the meantime.
When it comes to bonds vs. stocks, the former are typically backed by the full faith and credit of the government or large companies. Because of this, they’re often considered lower risk than stocks.
However, the risk varies, and bonds are rated for their quality and credit-worthiness. Because the U.S. government is less likely to go bankrupt than an individual company, Treasury bonds are considered to be some of the least risky investments. However, they also tend to have lower returns.
Different Types of Bonds
Treasurys: These are bonds issued by the U.S. government. Treasurys can have maturities that range from one-month to 30-years, but the 10-year note is considered a benchmark for the bond market as a whole.
Municipal bonds: Local governments or agencies can also issue their own bonds. For example, a school district or water agency might take out a bond to pay for improvements or construction and then pay it off, with interest, at whatever terms they’ve established.
Corporate bonds: Corporations also issue bonds. These are typically given a credit rating, with AAA being the highest. High-yield bonds, also known as junk bonds, tend to have higher yields but lower credit ratings.
Mortgage and asset-backed bonds: Sometimes financial institutions bundle mortgages or other assets, like student loans and car loans, and then issue bonds backed by those loans and pass on the interest.
Zero-coupon bonds: Zero coupon bonds may be issued by the U.S. Treasury, corporations, and state and local government agencies. These bonds don’t pay interest. Instead, investors buy them at a great discount from their face value, and when a bond matures, the investor receives the face value of the bond.
Pros and Cons of Bond Investments
Pros
Cons
Bonds offer regular interest payments.
The rate of returns with bonds tends to be much lower than it is with stocks.
Bonds tend to be lower risk than stocks.
Bond trading is not as fluid as stock trading. That means bonds may be more difficult to sell.
Treasurys are considered to be safe investments.
Bonds can decrease in value during periods of high interest rates.
High-yield bonds tend to pay higher returns and they have more consistent rates.
High-yield bonds are riskier and have a higher risk of default, and investors could potentially lose all the money they’ve invested in them.
💡 Quick Tip: Investment fees are assessed in different ways, including trading costs, account management fees, and possibly broker commissions. When you set up an investment account, be sure to get the exact breakdown of your “all-in costs” so you know what you’re paying.
3. Mutual Funds
A mutual fund is an investment managed by a professional. Funds typically focus on an asset class, industry or region, and investors pay fees to the fund manager to choose investments and buy and sell them at favorable prices.
Pros and Cons of Mutual Fund Investments
Pros
Cons
Mutual funds are easy and convenient to buy.
There is typically a minimum investment you need to make.
They ate more diversified than stocks and bonds so they carry less risk.
Mutual funds typically require an annual fee called an expense ratio and some funds may also have sales charges.
A professional manager chooses the investments for you.
Trades are executed only once per day at the close of the market, which means you can’t buy or sell mutual funds in real time.
You earn money when the assets in the mutual fund rise in value.
The management team could be poor or make bad decisions.
There is dividend reinvestment, meaning dividends can be used to buy additional shares in the fund, which could help your investment grow.
You will generally owe taxes on distributions from the fund.
4. ETF
Exchange traded funds can appear to be similar to a mutual fund, but the main difference is that ETFs can be traded on a stock exchange, giving investors the flexibility to buy and sell throughout the day. They also come in a range of asset mixes.
Pros and Cons of ETF Investments
Pros
Cons
ETFs are easy to buy and sell on the stock market.
The ease of trading ETFs might tempt an investor to sell an investment they should hold onto.
They often have lower annual expense ratios (annual fees) than mutual funds.
A brokerage may charge commission for ETF trades.This could be in addition to fund management fees.
ETFs can help diversify your portfolio.
May provide a lower yield on asset gains (as opposed to investing directly in the asset).
They are more liquid than mutual funds.
5. Annuities
An annuity is an insurance contract that an individual pays upfront and, in turn, receives set payments.
There are fixed annuities, which guarantee a set payment, and variable annuities, which put people’s payments into investment options and pay out down the road at set intervals. There are also immediate annuities that begin making regular payments to investors right away.
Pros and Cons of Annuity Investments
Pros
Cons
Annuities are generally low risk investments.
Annuities typically offer lower returns compared to stocks and bonds.
They offer regular payments.
They typically have high fees.
Some types offer guaranteed rates of return.
Annuities are complex and difficult to understand.
Can be a good supplement investment for retirement.
It can be challenging to get out of an annuities contract.
6. Derivatives
There are several types of derivatives but two popular ones are futures and options. Futures contracts are agreements to buy or sell something (a security or a commodity) at a fixed price in the future.
Meanwhile, in options trading, buyers have the right, but not the obligation, to buy an asset at a set price.
Derivatives allow investors to lock in a price on a security or commodity.
Derivatives can be very risky and are best left to traders who have experience with them.
They can be helpful for mitigating risk with certain assets.
Trading derivatives is very complex.
They provide income when an investor sells them.
Because they expire on a certain date, the timing might not work in your favor.
💡 Quick Tip: How to manage potential risk factors in a self-directed investment account? Doing your research and employing strategies like dollar-cost averaging and diversification may help mitigate financial risk when trading stocks.
7. Commodities
A commodity is a raw material — such as oil, gold, corn or coffee. Trading commodities has a reputation for being risky and volatile. That’s because they’re heavily driven by supply and demand forces. Say for instance, there’s a bad harvest of coffee beans one year. That might help push up prices. But on the other hand, if a country discovers a major oil field, that could dramatically depress prices of the fuel.
Investors have several ways they can gain exposure to commodities. They can directly hold the physical commodity, although this option is very rare for individual investors (Imagine having to store barrels and barrels of oil).
So many investors wager on commodity markets via derivatives — financial contracts whose prices are tied to the underlying raw material. For instance, instead of buying physical bars of precious metals to invest in them, a trader might use futures contracts to make speculative bets on gold or silver. Another way that retail investors may get exposure to commodities is through exchanged-traded funds (ETFs) that track prices of raw materials.
Pros and Cons of Commodity Investments
Pros
Cons
Commodities can diversify an investor’s portfolio.
Commodities are considered high-risk investments because the commodities market can fluctuate based on factors like the weather. Prices could plummet suddenly.
Commodities tend to be more protected from the volatility of the stock market than stocks and bonds.
Commodities trading is often best left to investors experienced in trading in them.
Prices of commodities are driven by supply and demand instead of the market, which can make them more resilient.
Commodities offer no dividends.
Investing in commodities can help hedge against inflation because commodities prices rise when consumer prices do.
An investor could end up having to take physical possession of a commodity if they don’t close out the position, and/or having to sell it.
8. Real Estate
Owning real estate, either directly or as part of real estate investment trust (REIT) investing or limited partnerships, gives you a tangible asset that may increase in value over time.
If you become invested in real estate outside of your own home, rent payments can be a regular source of income. However, real estate can also be risky and labor-intensive.
Pros and Cons of Real Estate Investments
Pros
Cons
Real estate is a tangible asset that tends to appreciate in value.
Real estate is not liquid. You may have a tough time selling it quickly.
There are typically tax deductions and benefits, depending on what you own.
There are constant ongoing expenses to maintain a property.
Investing in real estate with a REIT can help diversify your portfolio.
Owning rental property is a lot of work. You have to handle managing it, cleaning it, and making repairs.
By law, REITs must pay 90% of their income in dividends.
With a REIT, dividends are taxed at a rate that’s usually higher than the rate for many other investments.
REITs offer more liquidity than owning rental property you need to sell.
REITs are generally very sensitive to changes in interest rates, especially rising rates.
REITs don’t require the work that maintaining a rental property does.
REITs can be a risky short-term investment and investors should plan to hold onto them for the long term.
9. Private Companies
Only public companies sell shares of stock, however private companies do also look for investment at times — it typically comes in the form of private rounds of direct funding. If the company you invest in ends up increasing in value, that can pay off, but it can also be risky.
Pros and Cons of Investing in Private Companies
Pros
Cons
Potential for good returns on your investment.
You could lose your money if the company fails.
Lets investors get in early with promising startups and/or innovative technology or products.
The value of your shares in the company could be reduced if the company issues new shares or chooses to raise additional capital. Your shares may then be worth less (this is known as dilution).
Investing in private companies can help diversify your portfolio.
Investing in a private company is illiquid, and it can be very difficult to sell your assets.
Dividends are rarely paid by private companies.
There could be potential for fraud since private company investment tends to be less regulated than other investments.
Investment Account Options
An investor can put money into different types of investment accounts, each with their own benefits. The type of account can impact what kinds of returns an investor sees, as well as when and how they can withdraw their money.
401(k)
A 401(k) plan is a retirement account provided by your employer. You can often put money into a 401(k) account via a simple payroll deduction, and in a traditional 401(k), your contribution isn’t taxed as income. Many employers will also match your contributions to a certain point. The IRS puts caps on how much you can contribute to a 401(k) annually.
Pros and Cons of 401(k)s
Pros
Cons
Contributions you make to a 401(k) can reduce your taxable income. The money is not taxed until you withdraw it when you retire.
There is a cap on how much you can contribute each year.
Contributions can be automatically deducted from your paycheck.
Most withdrawals before age 59 ½ will incur a 10% penalty
Your employer may provide matching funds up to a certain limit.
You must take required minimum distributions from the plan (RMDs) when you reach a certain age.
You can roll over a 401(k) if you leave your job.
You may have limited investment options.
IRA
IRA stands for “individual retirement account” — so it isn’t tied to an employer. There are IRS guidelines for IRAs, but, essentially, they’re retirement accounts for individuals. IRAs allow people to set aside money pre-tax for retirement without needing an employer-backed 401(k).
Pros and Cons of 401(k)s
Pros
Cons
Contributions are tax deferred. You don’t pay taxes until you withdraw the funds.
Low contribution limits ($6,500 in 2023).
You can choose how the money is invested, giving you more control.
There is a 10% penalty for most early withdrawals before age 59 ½.
Those aged 50 and over can contribute an extra $1,000 in catch-up contributions.
Brokerage Accounts
A brokerage account is a taxed account through which you can buy most of the investments discussed here: stocks, bonds, ETFs. Some brokerage firms charge fees on the trades you make, while others offer free trading but send your orders to third parties to execute — a practice known as payment for order flow. Investors can be taxed on any realized gains.
You might also consider enlisting the help of a wealth manager or financial advisor who can provide financial planning and advice, and then manage your portfolio and wealth. Typically, these advisors are paid a fee based on the assets they manage.
There are even a number of investment options out there not listed here — like buying into a venture capital firm if you’re a high-net-worth individual or putting funding into your own business.
Pros and Cons of 401(k)s
Pros
Cons
Offer flexibility to invest in a wide range of assets.
You must pay taxes on your investment income and capital gains in the year they are received.
Brokerage accounts provide the potential for growth, depending on your investments. However, all investments come with risks that include the potential for loss.
Investments in brokerage accounts are not tax deductible.
You can contribute as much as you like to a brokerage account.
There is a risk that you could lose the money you invested.
Investing With SoFi
It might still seem overwhelming to figure out what kinds of investments will help you achieve your goals. There are different investment strategies and finding the right one can depend on where you are in your career, what your financial goals are and how far away retirement is.
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).
Invest with as little as $5 with a SoFi Active Investing account.
FAQ
What is the most common investment type?
Stocks are one of the most common and well-known types of investments. A stock gives an investor fractional ownership of a public company in units known as shares.
How do I decide when to invest?
Some prime times to start investing include when you have a retirement fund at work that you can contribute to and that your employer may contribute matching funds to (up to a certain amount); you have an emergency fund of three to six months’ worth of money already set aside and you have additional money to invest for your future; there are financial goals you’re ready to save up for, such as buying a house, saving for your kids’ college funds, or investing for retirement. Please remember you need to consider your investment objectives and risk tolerance when deciding the “right” time to start investing.
Should I use multiple investment types?
Yes. It’s wise to diversify your portfolio. That way, you’ll have different types of assets which will increase the chances that some of them will do well even when others don’t. This will also help reduce your risk of losing money on one single type of investment. In short, having a diverse mix of assets helps you balance risk with return. However, diversification does not eliminate all risk.
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Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
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Most people aren’t prepared for the wild and sometimes-bumpy ride of negotiating counter offers in real estate, even though the experience is remarkably common.
Home sellers are free to make a counter offer if they’re dissatisfied with a buyer’s initial bid. Usually, that counter offer indicates they’ve accepted the buyer’s offer subject to certain changes, including updates to contingencies, closing date, and sales price.
Counter offers are a fairly standard part of the home-buying process, but the rules of engagement might not seem remotely intuitive at the time. To help understand how counter offers in real estate work, what the typical negotiating steps look like, and how to counter offer on real estate, here’s a little guide you can cram with.
Common Reasons for Counter Offers
From the beginning of the home-buying process, unexpected twists and turns can arise. After sifting through hundreds of listings, attending several showings, and putting an offer in on a dream home (or two, or three), the deal can be far from done.
There are many reasons why it takes time to buy a house, and counter offers can certainly be one of them. Counter offers in real estate can come into play in these scenarios:
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A Change in Sales Price
One of the most commonly contested items in the purchase of a house is the sales price. If buyers come in lower than the asking price with their offer, sellers might counter with the original asking price (if they’re unwilling to negotiate) or somewhere between the asking price and the offer.
Sometimes sellers simply need more time to vacate the premises. Whether they have unfinished business or unexpected plans, they may present a counter offer that extends the escrow period to allow them more time to move out.
Increasing the Earnest Money Deposit
In some cases, the seller could up the ante by increasing the earnest, or “good faith,” money deposit the buyer submits with the offer. Earnest money deposits are typically between 1% and 3% of the purchase price, but in a hot market, there’s a chance the seller could ask for more to ensure the buyer is serious about purchasing the property.
💡 Quick Tip: To see a house in person, particularly in a tight or expensive market, you may need to show the real estate agent proof that you’re preapproved for a mortgage. SoFi’s online application makes the process simple.
The Removal of Certain Contingencies
Contingency clauses are actions or conditions that must be met before a real estate contract becomes binding. If you’re a first-time homebuyer (or even if you aren’t) it’s wise to brush up on these terms. Common contingencies, which most sellers will see as standard in a real estate offer, are:
• An appraisal contingency to protect buyers if the property is valued lower than the amount they offer.
• A financing contingency that allows buyers adequate time to get a mortgage or other financing to purchase the property.
• An inspection contingency that ensures buyers have the right to a thorough inspection of the property within a specified period of time.
Some contingencies, however, are considered less than standard. For example, a home sale contingency grants buyers a set amount of time to sell their existing home so they can finance the new property. Some sellers may find this contingency burdensome, particularly in a hot market, so they could make a counter offer that removes the home sale contingency. They can also counter with a “kick-out clause” that gives a real estate agent the right to keep showing the house while buyers attempt to sell their existing home.
Requesting Repairs
If a home inspection reveals necessary repairs or renovations to the property, the buyer could submit a counter offer to negotiate a lower price or ask the seller to complete the repairs before closing.
Deciding Who Covers Closing Costs
In a buyer’s market, it might be possible to negotiate the house price or some or all of the closing costs to be paid by the seller. These costs include appraisal fees, settlement fees, title policies, recording fees, land surveys, and transfer tax. Many buyers are surprised by how expensive closing costs are, but in particularly hot markets with multiple offers, sellers can counter with a simple “no” to indicate they won’t be covering those costs for the buyer.
How Do Counter Offers Work in Real Estate
While real estate counter offers vary depending on the market, the seller’s unique circumstances, and other standalone factors, there are some fairly standard parameters to the counter offer process:
What’s a ‘Normal’ Number of Counter Offers?
There’s no legal limit to the number of counter offers in real estate transactions. Initial offers, counter offers, and subsequent counter offers could ping pong back and forth for weeks or more.
Knowing the local real estate market trends can be key here. In a buyer’s market with plenty of houses for sale, sellers might want to be cautious about submitting an unnecessary number of counter offers.
Similarly, in a seller’s market where inventory is low and buyer competition is high, buyers might want to limit the number of counter offers they push back at the seller.
Can a Seller Make Simultaneous Counter Offers?
Depending on the state where the real estate transaction takes place, a seller may or may not be able to make counter offers to more than one buyer. That said, most real estate agents advise against multiple simultaneous counter offers, as it could end up in two legally binding contracts for the seller.
How Long Does the Process Take?
Number of counter offers aside, homebuyers can expect a closing to take about 45 days, on average. But how long it takes still varies from buyer to buyer, with factors like whether they’re paying cash, how long it takes them to find an inspector, and if the house appraises at a lower value, affecting the overall timeline.
💡 Quick Tip: You deserve a more zen mortgage. SoFi Mortgage Loan Officers are dedicated to closing your loan on-time — backed by a $5,000 guarantee offer.‡
How to Counter Offer in Real Estate
To some degree there’s such a thing as real estate counter offer etiquette. Here are a few things to consider when engaging in the counter offer process:
Have a Comprehensive Picture of Costs
For buyers, having an accurate handle on what it will cost to buy the house is essential for negotiating counter offers discerningly.
Closing costs can be one of the most negotiated items between buyers and sellers and add up to as much as 5% of the mortgage amount. Having a firm grasp of how much to expect in closing costs can help guide the counter offer process.
Setting realistic expectations for the monthly housing payment (including the mortgage principal and interest, insurance, maintenance, any homeowners association fees, and other costs) and what they can afford to pay as a lump sum at closing can help shape this picture for the buyer.
A mortgage calculator helps buyers break down the cost of purchasing a home. Understanding the various factors that might affect your home loan costs is important, too.
A “strong” offer is backed by data that defines what’s happening in the market, and research (with the help of an agent) around what’s considered “fair market value.” Being preapproved for a home loan will make you an attractive candidate from the seller’s point of view.
Coming in at 15% or more under the fair market value is generally considered a “lowball” offer and can start buyers off on the wrong foot. In some cases, sellers might skip right over anything that isn’t considered a strong offer.
Know What Can Be Negotiated
One of the first steps in making a real estate counter offer is knowing what can be negotiated:
• Possession date. Giving the sellers more time to move out could mean an exchange for a condition the buyer desires. Buyers hoping to move in sooner might make a counter offer requesting an earlier possession date.
• Personal property. Some of the seller’s personal property like furniture, window treatments, artwork, or gardening tools could be negotiated into the contract in a counter offer.
• Home warranty. Older houses can come with their own unique sets of systems and appliances, so buyers might make a counter offer asking the sellers to cover the cost of a one- to two-year home warranty ($350 to $600 annually, on average) if unexpected repairs need to be made after move-in.
• Earnest money deposit. Whether buyers are trying to reduce their risk of something going wrong during closing or strengthen their offer, they can negotiate a lower or higher earnest money deposit with a counter offer.
Be Timely and Responsive
Real estate offers and counter offers often come with a set expiration date, so time is usually of the essence. Forty-eight hours is a standard acceptance window in many real estate markets, but in hot markets offers might expire within 24 hours or less.
Some sellers take this concept to a whole new level, setting stringent requirements around offer acceptance. It’s up to buyers to determine whether or not they’re willing to reply quickly enough to meet the sellers’ time demands or risk losing the deal.
Try Not to Take Things Personally
It might not feel like “all’s fair in buying and selling a home” since it’s one of the biggest financial transactions many will make in their lifetime. But buyers and sellers shouldn’t be surprised if it comes with a little bit of literal give and take.
And while it might seem like a personal affront to have a real estate offer rejected, it’s possible (and even likely) that the seller has multiple offers or was simply able to strike a better deal.
When push comes to shove and purchase comes to close, buying a house is a matter of business, no matter how personal the home-buying journey can feel.
The Takeaway
Real estate offers and counter offers are a common form of business negotiation, and a first step in making a counter offer is knowing what can be negotiated. Being cognizant of counter offer etiquette can be helpful.
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FAQ
How do you handle counter offers in real estate?
Counter offers are an expected part of the negotiation process so approach any counter offer calmly. Know your goal for the overall cost of your home purchase or sale, and what levers you can pull to get there (lower/higher price? Change in contingencies or closing timeline?). Come back with your strongest counter offer but always be prepared to walk away.
What are the steps in a counter offer?
Understand the complete picture of costs in the transaction. Go in with your strongest counter offer, in a timely fashion, and don’t take it personally if you don’t get 100 percent of what you want from the deal.
What is the general rule of counter offers?
The number one rule of counter offers, whether you’re buying or selling, is to know what total price you can ultimately afford. Keep calm and negotiate on, but don’t get emotionally involved — you may need to walk away at any time.
*SoFi requires Private Mortgage Insurance (PMI) for conforming home loans with a loan-to-value (LTV) ratio greater than 80%. As little as 3% down payments are for qualifying first-time homebuyers only. 5% minimum applies to other borrowers. Other loan types may require different fees or insurance (e.g., VA funding fee, FHA Mortgage Insurance Premiums, etc.). Loan requirements may vary depending on your down payment amount, and minimum down payment varies by loan type.
‡SoFi On-Time Close Guarantee: If all conditions of the Guarantee are met, and your loan does not close on or before the closing date on your purchase contract accepted by SoFi, and the delay is due to SoFi, SoFi will give you a credit toward closing costs or additional expenses caused by the delay in closing of up to $10,000.^ The following terms and conditions apply. This Guarantee is available only for loan applications submitted after 04/01/2024. Please discuss terms of this Guarantee with your loan officer. The mortgage must be a purchase transaction that is approved and funded by SoFi. This Guarantee does not apply to loans to purchase bank-owned properties or short-sale transactions. To qualify for the Guarantee, you must: (1) Sign up for access to SoFi’s online portal and upload all requested documents, (2) Submit documents requested by SoFi within 5 business days of the initial request and all additional doc requests within 2 business days (3) Submit an executed purchase contract on an eligible property with the closing date at least 25 calendar days from the receipt of executed Intent to Proceed and receipt of credit card deposit for an appraisal (30 days for VA loans; 40 days for Jumbo loans), (4) Lock your loan rate and satisfy all loan requirements and conditions at least 5 business days prior to your closing date as confirmed with your loan officer, and (5) Pay for and schedule an appraisal within 48 hours of the appraiser first contacting you by phone or email. This Guarantee will not be paid if any delays to closing are attributable to: a) the borrower(s), a third party, the seller or any other factors outside of SoFi control; b) if the information provided by the borrower(s) on the loan application could not be verified or was inaccurate or insufficient; c) attempting to fulfill federal/state regulatory requirements and/or agency guidelines; d) or the closing date is missed due to acts of God outside the control of SoFi. SoFi may change or terminate this offer at any time without notice to you. *To redeem the Guarantee if conditions met, see documentation provided by loan officer. 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.
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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.
Students want to see one word when they get letters from their prospective colleges: accepted. Unfortunately, that likely isn’t going to be the result every time. Some students will end up on the college waitlist, but that doesn’t mean they won’t be accepted eventually.
Being waitlisted is not the same as being rejected. There’s still a possibility of getting accepted and attending that dream school.
So what does it mean to be on a college waitlist? It means you’re still up for consideration based on how many spaces are left after decision day. Getting accepted from the waitlist depends on how many accepted students choose to attend the school.
Decision day is May 1, when incoming freshmen are required to notify schools whether they will be attending or not. If not enough students accept their invites for schools to meet enrollment numbers, then students on the waitlist will be reevaluated and potentially accepted.
There’s no guarantee that accepting a spot on the waitlist will lead to being admitted, but that doesn’t mean you should give up. There are still things you can do to boost your chances.
Key Points
• Being waitlisted means there is still a chance of admission if spots open up after decision day, which is typically May 1st for colleges.
• Students should accept their waitlist position and follow instructions from the college, including expressing continued interest through a letter.
• Requesting an interview can help strengthen a student’s case for admission off the waitlist, allowing for a personal connection with the admissions team.
• It’s advisable to secure a spot at a second-choice school while pursuing opportunities for admission from the waitlist to ensure college attendance.
• Maintaining strong senior year grades is crucial, as they can impact waitlist decisions, and transferring to the dream school later is an option if necessary.
Waitlisted or Deferred?
In some cases, a student may receive a letter saying they’ve been deferred rather than being put on the waitlist. So what’s the difference? A deferral usually involves students who applied for early action or early decision. These applications are generally turned in during November of senior year.
If a student applies via early action or decision and they receive a deferral, that means they have not yet been accepted but their application has been changed to regular decision. The application will be reviewed again during the regular decision time frame.
A deferral is different from a waitlist, but students who have been deferred generally want to take the same actions as those who have been waitlisted to better their chances of admission.
💡 Quick Tip: You’ll make no payments on some private student loans for six months after graduation.
What to Do When You Get Waitlisted
Students who have been waitlisted but still want to attend the school must first do one thing: Accept their position on the waitlist.
If you neglect to contact the school and accept your position, you’ll be removed from the list and won’t be considered for admission if there are spots left after decision day.
Once you’ve accepted your spot on the waitlist, there are a few steps you can take that may better your chances of being accepted. Here’s a close look.
Contact Admissions
When you receive a letter informing you that you’ve been waitlisted, there might be some instructions included. First and foremost, it’s a good idea to follow them.
Next, it’s often recommended that students contact admissions with a letter to further stress their commitment to attending the school. The letter should detail why you want to attend that school and why you believe that school is the best fit for you. You might also want to ask that the letter be kept in your file along with your other application materials.
Request an Interview
Asking for an interview can be helpful in getting off the waitlist. Meeting with someone in person may make you more memorable when it comes time to accept applicants from the waitlist.
If you already did an interview, it’s okay to request another one after receiving a waitlist decision. A second interview provides the chance to reinforce your commitment to the school and add any recent accomplishments to the conversation. This can be a great time to bring up anything special you have achieved during the spring semester.
Reserve a Spot at Your Second Choice
Even though it can be discouraging, it’s highly recommended that students who’ve been waitlisted for their first-choice school put a deposit down for their next-best option. Putting a deposit down on another school isn’t giving up on your dream school; it’s just an important safety net to ensure you have somewhere to attend.
Some students may opt to take a “gap year” if they don’t make it into their school of choice. This choice is highly personal, though, and there isn’t a clear recommendation on how beneficial or harmful it is. Some students may find a gap year useful and productive, while others may find that it deters them from going back to school on time.
Anyone committed to attending college in the fall will likely find it a smart move to put a deposit down on their second- or even third-place school, and then continue working on getting accepted off the waitlist for their first choice.
Retake Tests
Students who did not score well on the SAT or ACT may want to consider retaking those tests if they’ve been waitlisted. Before you do that, however, it’s a good idea to contact the college to make sure it’s willing to accept additional application information. If the school will accept it, and you think you can get better scores, it could be helpful to go ahead and retake the tests.
Most colleges will accept scores from either test, but it’s best to check with each school to be sure. Both tests have a similar goal, testing for college readiness, but they vary slightly in timing and types of questions asked.
If you need to improve your test scores but have limited time or money, it may help to research the difference between the two tests and take the one you feel you can perform better on. Taking practice tests can also help you determine which test suits you better. Many students do take both tests, so that is an option as well.
Make the end of senior year impressive. Don’t let that waitlist cause discouragement. If you truly want to make it off the waitlist, you’ll want to work even harder at the end of your senior year. Senior grades can still affect admissions, so keeping them high may help those who are on the waitlist.
If you still don’t get accepted to your dream school, it doesn’t mean you have to give up. Even if you’re not accepted from the waitlist, there are still a couple of options. You can accept admission from a different school and aim to transfer to your dream school after one to two years. This allows time to earn good grades, get the necessary credits, then transfer.
If your plan is to transfer schools, however, you’ll want to work closely with your counselor to make sure you’re taking the correct courses and carefully consider your choice of major, since not all credits will transfer to all schools.
💡 Quick Tip: Would-be borrowers will want to understand the different types of student loans that are available: private student loans, federal Direct Subsidized and Unsubsidized loans, Direct PLUS loans, and more.
Ready to Start. What’s Next?
Whether you make it off the waitlist and get into your dream school or choose to accept admission at your second choice, you’ll be faced with tuition. So how to cover the cost? Tuition, fees, books, food, plus all the other costs of living… it adds up quickly.
Luckily, there are resources available to help students finance their college education. The first step for most should be filling out the Free Application for Federal Student Aid (FAFSA). The application will determine eligibility to receive federal aid. The eligibility for undergraduates to receive aid is most often based on their parents’ income. This process will inform students of how much federal aid they can receive, and what kind.
Federal aid can come in the form of grants, loans, and work-study. Grants don’t need to be repaid (unless you withdraw from school and owe a refund), but loans do. Federal loans come with some benefits that students won’t get with private student loans, including income-driven repayment plans and potentially lower interest rates.
Another option for funding the college experience is a private scholarship. There are a wide variety of scholarships available, with different eligibility requirements for each one. Some scholarships are need-based; some are merit-based.
If you can’t finance college completely with federal aid and scholarships, private student loans are also available. The eligibility for private student loans is usually based on the student’s (or cosigner’s) income and credit history. Rates and terms vary by lender, so it’s important for students to research their options before making a choice.
If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.
Cover up to 100% of school-certified costs including tuition, books, supplies, room and board, and transportation with a private student loan from SoFi.
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SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.
SoFi Private Student Loans Please borrow responsibly. SoFi Private Student loans are not a substitute for federal loans, grants, and work-study programs. We encourage you to evaluate all your federal student aid options before you consider any private loans, including ours. Read our FAQs.
Terms and Conditions Apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. SoFi Private Student loans are subject to program terms and restrictions, such as completion of a loan application and self-certification form, verification of application information, the student's at least half-time enrollment in a degree program at a SoFi-participating school, and, if applicable, a co-signer. In addition, borrowers must be U.S. citizens or other eligible status, be residing in the U.S., and must meet SoFi’s underwriting requirements, including verification of sufficient income to support your ability to repay. Minimum loan amount is $1,000. See SoFi.com/eligibility for more information. Lowest rates reserved for the most creditworthy borrowers. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change. This information is current as of 04/24/2024 and is subject to change. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891. (www.nmlsconsumeraccess.org).
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.
A budget can be a great and necessary way to take control of your finances. It helps you track money coming in and going out, which could mean your spending on necessities, fun experiences, and saving for the future.
While many people prefer a monthly budget, a weekly budget can be a better option for others. It gives added control and flexibility in wrangling your finances. For instance, if you get hit with a bigger than expected bill in the first week of a month, you can take steps to accommodate that. Or, if you wind up getting a rebate, you might decide to allocate that towards debt ASAP.
Here, you’ll learn more about this process, including:
• What is a weekly budget?
• How do you budget weekly?
• What are the pros and cons of a weekly budget?
What Is a Weekly Budget
A weekly budget is a way to organize your finances and manage your money on a weekly cycle. It can help show you the money you have coming in, how much you’ll need for the necessities of life (housing, food, utilities, healthcare, etc.), how much you can spend on the wants in your world (dining out, entertainment, travel, cool gear), and how much should be set aside for savings.
For many people, a weekly guardrail like this helps them ensure their cash is tracking properly.
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How Weekly Budgets Work
Here’s how a weekly budget works:
• Figure out your take-home pay per week. This likely requires a bit of basic division since many people are paid bi-weekly or at another cadence.
• Next, look at your spending on necessities, such as housing, utilities, basic food (but not dining out or those vanilla lattes), minimum debt payments, healthcare, and insurance.
• Subtract those expenses from your income. See how much is left.
• From this remaining amount, allocate how much you can spend on “fun” items, such as dining out or takeout, clothing that isn’t vital, entertainment, travel, and the like.
• Also remember to allocate funds for savings. Many experts recommend a figure of 20% but that may vary depending on your cost of living, debt, and other factors.
• Now that you see how much money is coming in and how much remains for spending after the needs of life are paid for, you can track and manage your spending and saving weekly to make sure you are hitting your marks.
Benefits of a Weekly Budget
If you think tracking your money with a monthly household budget is a pain, the idea of putting even more effort into the process — and breaking it down by the week — may feel like overkill. But there could be some benefits to be had from the effort.
Here are a few pros and cons to consider:
Pro: More Flexibility
Life doesn’t always follow a schedule. A monthly budget can be a good fit for fixed expenses that are paid once a month (rent and car payments, student loan payments, etc.), or even quarterly or annual bills (insurance payments, subscriptions, and memberships). But other costs can be less predictable, such as dining out with friends, unexpected car repairs, clothing purchases; gifts; or an occasional massage or pedicure splurge.
Especially when it comes to discretionary expenses, using a weekly budget could help you spot when, where, and why you overspent in a certain category. And you can react more quickly to make changes to get back on track. In these ways, living on a budget can be a real advantage.
If you sit down to review your spending every week, instead of just once a month, you may be able to run through your transactions more quickly. And the less time-consuming and tedious your budget routine is, the less annoying it may be — which might make it easier to stay with it.
Pro: Planning Around Paychecks
If, like most Americans, you’re paid every week or every other week — or your spouse is — a weekly or biweekly budget could offer more flexibility for saving and spending.
People who are paid weekly have some months with four paychecks and some months with five. Those who are paid every other week have some months with two paychecks and some months with three.
A weekly budget could help pinpoint those extra paydays so you can take advantage of the opportunity to work on a short- or long-term goal. You might stockpile a few grocery-store staples that could help tide you over during leaner months, for example. Or you may want to set aside the money to start an emergency fund. Or you could use it to save for a wedding, honeymoon, or vacation.
Pro: Simplifying Savings
Switching to a budget that aligns with weekly or biweekly paydays also could make saving more manageable.
If you’re enrolled in a 401(k) or similar investment savings plan at work, you may already be making contributions each payday. You could do the same thing with your savings account by using a direct deposit from your paycheck. Or you could set up automatic transfers and move money from your checking account to your savings account each week.
Keep in mind that the more interest you earn, the faster you can get to your goals. So you may want to spend some time shopping for an account that offers both a competitive interest rate and innovative ways to manage your finances.
Get up to $300 when you bank with SoFi.
No account or overdraft fees. No minimum balance.
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Downsides of a Weekly Budget
As you might expect, there are also some cons of a weekly budget. Consider the following:
Con: Too Much Temptation
The added flexibility that can make a weekly budget appealing also could make it easier for some individuals and households to be tempted off course — especially when it comes to discretionary spending. Telling yourself that you’ll spend less “next week” to justify getting what you want right now could become a habit. An important part of successful budgeting is sticking to the budget.
With that in mind, you might want to tuck each week’s discretionary money into an envelope …and when it’s gone, it’s gone. Using a tracking app to keep track of your expenses on your phone or tablet also could help.
Taking the time each week to review your purchases and update your budget may not be realistic for some people. If finding time to check in with your budget each week feels too overwhelming you may want to try a bi-weekly or monthly approach.
💡 Quick Tip: Want a simple way to save more each month? Grow your personal savings by opening an online savings account. SoFi offers high-interest savings accounts with no account fees. Open your savings account today!
4 Steps To Create a Weekly Budget
Making a budget — whether it’s set up to be weekly, biweekly, monthly, or a bit of a combo — can be a good way to get control of your finances. Here’s are some steps to setting up a weekly budget template:
1. Pull Together Your Paperwork
If you want your budget to be useful, it should be as accurate as possible. So you’ll probably want to pull together some paperwork to help get it right, including your most recent pay stubs, bank statements, utility bills, insurance bills, credit card bills and loan statements, and any other recurring bills you can think of. You may also find it helps to have tracked your spending (on paper or with an app) for a while before you sit down to create your budget. Or you may want to collect recent grocery store, drug store, and restaurant receipts to help you estimate those costs.
2. Calculate Your Weekly Income
Write down all your income sources for a month. (If you’re married, include your spouse’s income sources. If you’re a freelancer or your income is unpredictable, you may want to calculate the average over the past three or four months.) Find your take-home amount (what you get after taxes and other payroll deductions) and divide it by four.
3. Make a Realistic List of Your Expenses
Using a budgeting program or app, a spreadsheet, or maybe just a notebook, write down all your expenses for the month. It can help to break down those costs by categories, such as:
• Housing costs. Things like your rent or mortgage, utilities, or other expenses
• Transportation. Costs like car payments, insurance, gas, and maintenance
• If you have children, costs like child care, tuition, activities, and more
• Financial expenses, such as bank fees or taxes
• Savings and investing. Contributions to 401(k) or IRA, emergency fund
• Health Care. Prescriptions, dental care, co-pays, and more
• Personal spending. Clothes, shoes, gym membership
• Entertainment. Movies, special events, streaming services, books, and more
Keep in mind that the categories you include in your budget will be influenced by your wants, needs, and spending habits.
You may decide you want to use a monthly budget for some expenses (utility bills and other fixed expenses) and a weekly budget for others (such as discretionary expenses, debt payments, and savings). But if you want to go weekly with everything, the math isn’t all that complicated. To convert monthly amounts into weekly spend amounts, multiply the monthly figure by 12 and then divide by 52.
4. Deduct Expenses from Income
Add up your weekly expenses and subtract that number from your weekly income. If you come out ahead, you could add more to your savings and investments, pay down debt even faster, or add more of a cushion to another category on your list. If you come out even, you may want to adjust your discretionary spending a bit, so an unexpected cost doesn’t throw you off track.
If you come out with a negative number, you may have to make some decisions about what costs you can cut or even get rid of.
Especially when you’re starting out, it may help to use a budget framework similar to the 50/30/20 budget rule, which suggests keeping essential costs to 50% or less, discretionary costs to 30% or less, and setting at least 20% aside for savings if you can. If your percentages are where you want them, you have a budget.
Once you have a budget you feel comfortable with, it’s time to test your new spending and savings strategy. You might decide to use a tracking app to see how you’re doing, but you also may benefit from actually sitting down to go over the numbers once a week. (This could be particularly helpful for married couples who are sharing a couples budget.)
If you spot any problem areas or realize you forgot something, you can always make adjustments. If something happens to change your income or expenses (a raise, a new job, a job loss, a big purchase, or a baby), you can adjust again.
Don’t be discouraged if the budget you built doesn’t work out the first time you use it. You may have to develop new habits. Or you may need to get some help with ditching your debt or determining your financial goals.
The Takeaway
Setting up a weekly budget could make it easier to stay on top of your spending by streamlining the number of transactions you have to track and helping you spotlight any areas you may be overspending in. However, for some, checking in and tracking your spending and transaction each week could become overwhelming. An app, possibly provided by your bank, could help.
Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with 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.
Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.00% APY on SoFi Checking and Savings.
FAQ
What should a weekly budget include?
A weekly budget should include your income, your necessary expenses (housing, utilities, food, healthcare, and more), your discretionary expenses (eating out, travel, entertainment), and your savings.
How do you budget weekly money?
To budget money weekly, you will need to divide your take-home pay into weekly amounts and then do the same with your spending on needs and wants, as well as savings. You want to be sure your weekly income can cover those expenditures.
What does having a weekly budget mean?
Having a weekly budget means you are balancing your income, spending, and saving on a weekly basis. This can be a good way to stay in close touch with your money, though for some people it might feel like overkill vs. monthly budgeting.
SoFi members with direct deposit activity can earn 4.00% 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 4.00% 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 4.00% 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 12/3/24. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
