Jul
29
2024

Share Draft Accounts: What Are They & How Do They Work?

By | Family Finances, Life & Career, money | Comments Off on Share Draft Accounts: What Are They & How Do They Work?

A share draft account or simply a share draft is a checking account that’s held at a credit union. Share draft accounts are similar to checking accounts offered by banks in terms of how you can use them.

There are, however, a few differences that set them apart. Whether a share draft account or a checking account is right for you can depend on your preferences for managing your money. If you’re thinking of opening a share draft at your local credit union, it helps to know more about how they work.

What Is a Share Draft Account?

The term “share draft account” is how credit unions refer to what banks call checking accounts. This terminology reflects in part how credit unions work.

When you join a credit union, you become a member of it. You, along with the other members, have an ownership share in the credit union. That’s a key distinction between a credit union vs. bank. Share draft is used to describe checking accounts belonging to credit union members.

You’ll also see the word “share” used with other types of accounts offered at credit unions. For example, a share account is the credit union equivalent of a bank savings account. These accounts can earn interest so you can grow your money over time.

Share certificates, meanwhile, are the credit union version of certificate of deposit (CD) accounts. You deposit money into a share certificate, which then earns interest until the certificate matures. At maturity, you can withdraw the initial deposit and interest earned or roll it into a new share certificate.

How Do Share Draft Accounts Work?

Share draft accounts work by allowing you to deposit money that you can then spend or withdraw later. Each time you deposit money, you’re essentially buying shares in the credit union that holds your account.

Generally, with a share draft account you can:

•   Pay bills online

•   Withdraw cash at ATMs (though there may be ATM withdrawal limits)

•   Make purchases online or in person using a linked debit card

•   Manage accounts via online and mobile banking

•   Add funds through direct deposit and/or remote deposit capture

•   Write checks

•   Link your debit card to mobile wallet apps

•   Send money to friends and family through Zelle or another mobile payment app

•   Send and receive ACH transfers or wire transfers

There may be various fees associated with these accounts, including monthly maintenance fees or overdraft fees. You may also pay ATM fees, depending on where you withdraw cash. Some share draft accounts pay dividends to credit union members as they’re declared quarterly, biannually, or annually.

Opening a share draft account is a bit different from opening a bank account. You first need to qualify for membership in a credit union.

The qualification requirements can vary by credit union. In terms of how much money to open an account, initial deposit requirements are usually on the lower side. It might be, say, $5 to $25 in many cases.

Credit unions can impose daily, weekly, and monthly limits on debit card transactions and ATM withdrawals. There may also be limits on check writing. Customer service availability can depend on the credit union.

Recommended: What Is Monetary Policy?

Pros of Share Draft Accounts

There’s a lot to like about share draft accounts and credit unions in general. Here are some of the main advantages of share draft accounts:

•   Initial deposit requirements are often low

•   Minimum balance requirements may be low or nonexistent

•   Some share draft accounts can earn dividends

•   Banking fees may be lower

•   Benefits and features tend to be similar to bank checking accounts

•   Credit unions can offer numerous ways to access share draft accounts, including online and mobile banking, ATMs, and branches.

There’s one more advantage to opening a share draft account. If you’re a member of a shared branch credit union, you can access your money through a wider network of branches. Shared branch banking means that even if your accounts are held at, for example, Credit Union A, you could access them at Credit Union B, which is convenient if you’re traveling.

Get up to $300 when you bank with SoFi.

No account or overdraft fees. No minimum balance.

Up to 4.00% APY on savings balances.

Up to 2-day-early paycheck.

Up to $2M of additional
FDIC insurance.


Cons of Share Draft Accounts

Share draft accounts may not be right for everyone. Before opening one, here are a few potential drawbacks to keep in mind:

•   Membership in a credit union is required to open a share draft account

•   Branch access may be limited if your credit union isn’t part of a shared branch network

•   There may be limits on withdrawals or debit card transactions

•   Dividend rates may be low.

Qualifying for membership in a credit union might be the biggest hurdle to joining one for some people. Credit unions can base membership on things like military affiliation, where you work or attend school, or religious affiliation. The good news is that there are some credit unions that have less stringent requirements and offer membership to a wider range of people. It can be worthwhile to shop around.

How Does a Share Draft Differ From a Traditional Bank Account?

Share draft accounts are similar to checking accounts offered at traditional banks, but they aren’t identical. Here are some of the most important differences between share draft vs.checking accounts.

Fees

Banks are known for often charging plenty of fees for checking accounts. Fees are a big part of how banks make a profit. Credit unions, on the other hand, are not-for-profit financial institutions. That means they generally charge their members fewer fees and can pay higher interest rates on deposit accounts than traditional banks.

Deposit Insurance

Deposits at banks and credit unions can both be insured against institutional failure. Whether your coverage comes through the FDIC vs. NCUA depends on where you keep your accounts. Credit unions are likely insured by NCUA, or the National Credit Union Administration.

•   The Federal Deposit Insurance Corporation (FDIC) insures deposits for up to $250,000 per depositor, per account ownership category, per insured financial institution. You may qualify for more deposit insurance if you have accounts in different ownership categories that meet FDIC requirements. This insurance reassures you that your checking account is safe.

•   The National Credit Union Administration insures deposits at member credit unions up to $250,000 per depositor, per insured credit union. Member deposits held in jointly-owned accounts are insured up to $250,000 as well.

Features and Benefits

Credit unions and banks can offer a different range of features and benefits for draft accounts and checking accounts, respectively. There can be a significant difference between what is a premium checking account at a bank and what constitutes a premium share draft account at a credit union, for example. Comparing what’s included with share draft and checking accounts can help you decide which one is better for your needs.

The Takeaway

Deciding to open a checking account or a share draft account can help you get a better handle on your money. Both share draft accounts and checking accounts make it easy to deposit funds, pay bills, withdraw cash, or make purchases as needed. Share draft accounts are held at credit unions, and they may have lower fees and minimum deposit and balance requirements. That said, they may lack accessibility vs., some banks.

If you’d like to manage your money at an online bank, consider what SoFi offers.

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 is the difference between regular share and share draft?

A share account is a savings account held at a credit union. Share accounts can earn interest in the form of dividends. Share draft accounts, however, are similar to a checking account and allow you to make draft withdrawals by writing checks, making purchases with a debit card, or withdrawing cash at ATMs.

What is the difference between a share draft and a checking account?

The difference between a share draft and a checking account is where they’re held. Share draft accounts are offered at credit unions; checking accounts are offered at banks. Share draft accounts can be NCUA-insured while checking accounts at banks have FDIC deposit insurance coverage.

Is a checking account better than a share draft?

A checking account may be preferable to a share draft account if you’d rather keep your money at a bank rather than a credit union. On the other hand, you might lean toward a share draft if you’d rather take advantage of perks that only a credit union may offer. Looking at your money management habits and preferences can help you decide whether a checking account or share draft is the better fit.

Photo credit: iStock/SDI Productions

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.

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.

*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.

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

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

SOBNK-Q324-022

Read more
Jul
28
2024

Guide to Using a Personal Cash Flow Statement

By | Budgeting & Goals, money | Comments Off on Guide to Using a Personal Cash Flow Statement

If you’re often surprised (and not in a good way) when you open up your credit card and bank statements and see how much money you spent, you are not alone. In this scenario, there could be a simple solution: a personal cash flow statement.

Creating a personal cash flow statement can give you a clear picture of your monthly cash inflow (money you earn) and your monthly cash outflow (money you spend). Armed with that intel, you can determine if you have a positive or negative net cash flow.

The process is relatively simple. It involves doing some basic math calculations with a month or two worth of bank statements and bills. Once you have your personal financial statement, you’ll know where you stand and likely be better able to budget your money.

What Is a Personal Cash Flow Statement?

“Cash flow” is a term commonly used by businesses to detail the amount of money flowing in and out of a company. Companies can use cash flow statements to determine how well the business is generating income to pay its debts and operating expenses.

Just like the ones used by companies, tracking your own cash flow can provide you with a snapshot of your financial condition.

You might learn, for example, that you have less leftover at the end of each month than you thought or that you are indeed operating at a shortfall.

Once you have the numbers down in black and white, you can then make any needed changes, such as cutting your expenses to save money, increasing income, and making sure that your spending is in line with your goals.

So, how do you set up one of these cash flow statements? You may find a personal cash flow statement template or a personal cash flow statement example online, but what follows will explain how and why to create one.

Get up to $300 when you bank with SoFi.

No account or overdraft fees. No minimum balance.

Up to 4.00% APY on savings balances.

Up to 2-day-early paycheck.

Up to $2M of additional
FDIC insurance.


How to Build a Personal Cash Flow Statement

Here are the steps to take to build a personal cash flow statement.

Listing All Your Sources of Income

A good first step when creating a personal cash flow statement is to get out all of your pay stubs, bank statements, credit card statements, and bills or review them online.

•   Next, list any and all sources of income — the inflow, such as salaries, anything you make from side hustles, interest from savings accounts, income from a rental property, dividends from investments, and capital gains from the sale of financial securities like stocks and bonds.

•   You might want to avoid listing money in accounts that aren’t available for spending. For example, you may not want to list dividends and capital gains from investment accounts if they are being automatically reinvested or those that are part of a retirement account from which you aren’t actively taking withdrawals.

•   Since income can vary from one month to the next, you might choose to tally inflow for the last three or six months in order to come up with an average.

Once you’ve collected and listed all of your income for the month, you can then calculate the total inflow.

Listing All of Your Expenses

Now that you know how much money is coming in each month, you’ll want to use those same statements and bills, as well as any for debts (such as mortgage, auto loan, or student loans) to list how much was spent during the month.

•   Again, if your spending tends to fluctuate quite a bit from month to month you may want to track it for several months and come up with an average.

•   To create a complete picture of how much of your money is flowing out each month, you’ll want to include necessities like food and gas, and also discretionary expenses, such as trips to the nail salon or your monthly streaming services.

•   Remember to include infrequent expenses such as birthday gifts for loved ones, annual insurance premiums, and the like.

•   Once you’ve compiled all of your expenses, you can calculate the total and come up with your total outflow for the month.

Determining Your Net Cash Flow

To calculate your cash flow, all you need to do is subtract your monthly outflow from your monthly inflow. The result is your net cash flow.

•   A positive number means you have a surplus, while a negative means you have a deficit in your budget.

•   A positive cash flow is desirable, of course, since it can provide more flexibility. You can decide how to best use the surplus. There are a variety of options. You could choose to save for an upcoming expense, make additional contributions to your retirement fund, create or add to an emergency fund, or, if your savings are in good shape, consider splurging on something fun.

•   A negative cash flow can signal that you are living a more expensive life than your income can support. Some people refer to this as not living within your means. In the future, maintaining this habit could lead to additional debt.

•   When creating personal cash flow statements, it’s also possible to have net neutral cash flow (all money coming in and going out is fairly equal).

In this case, you may still want to jigger things around if you are not already putting the annual maximum into your retirement fund and/or you don’t have a comfortable emergency cash cushion.

The Difference Between a Personal Cash Flow Statement and a Budget

A personal cash flow statement provides a comprehensive look at what is currently coming in and going out of your bank accounts each month. You might think of a cash flow statement telling you where you are, financially speaking.

Whichever budget method you use, on the other hand, helps you to get where you want to go by giving you a spending plan that is based on your income and expenses. A budget can provide you with some general spending guidelines, such as how much you should spend on groceries, entertainment, and clothing each month so that you don’t exceed your income — and end up with a negative net flow.

Creating a budget can also be a good opportunity to check in with your financial goals.

For example:

•   Are you on track for saving for retirement?

•   Are you interested in tackling the credit card debt that has been spiraling due to high interest rates?

•   Do you want to amp up your emergency fund, separate from your usual checking and savings account?

•   How are you progressing on paying off your student loans?

Whatever your goal, a well-crafted budget could serve as a roadmap to help you get there.

Recommended: 4 Smart Ways to Pay Off Student Loans

Using Your Personal Financial Statement to Create a Simple Budget

Because a cash flow statement provides a comprehensive look at your overall spending habits, it can be a great jumping off point to set up a simple budget.

When you’re ready to create a budget, there are a variety of resources:

•   Break out a pencil and paper or buy a journal for this purpose

•   Use an app that’s part of your bank’s suite of tools

•   Download an app that isn’t connected to your financial institution but offers budgeting services

•   Try out spreadsheet templates and printable worksheets.

A good first step in creating a budget is to organize all of your monthly expenses into categories.

Spending categories typically include necessities, such as rent or mortgage, transportation (like car expenses or public transportation costs), food, cell phone, healthcare/insurance, life insurance, childcare, and any debts (credit cards/loans).

You’ll also need to list non-essential spending, such as cable travel, streaming services, concert and movie tickets, restaurants, clothing, etc.

You may also want to include monthly contributions to a retirement plan and personal savings into the expense category as well.

And, if you don’t have emergency savings in place, put that on the spending list as well, so you can start saving towards that every month. How big an emergency fund do you need? Use an emergency fund calculator, and aim to cover at least three to six months’ of living expenses.

Once you have a sense of your monthly earnings and spending, you may want to see how your numbers line up with general budgeting guidelines. Financial counselors sometimes recommend the 50/30/20 budget rule, which looks like this:

•   50% of money goes towards necessities such as a home, car, cell phone, or utility bills.

•   30% goes towards your wants, such as entertainment and dining out.

•   20% goes towards your savings goals, such as a retirement plan, a downpayment on a home, emergency fund, or investments.

Improving Your Net Cash Flow

If your net cash flow is not where you want it to be or, worse, dipping into negative territory, a budget can help bring these numbers into balance.

The key is to look closely at each one of your spending categories and see if you can find some ways to trim back.

•   One of the easiest ways to change your spending habits can be to cut some nonessential expenditures. If you’re paying for cable but mostly watch streaming services, for example, you could score some real savings by getting rid of that service and its bill.

•   Not taking as many weekend getaways and cooking more often instead of getting takeout could add up to a big difference. If you tend to be a compulsive or impulsive shopper, you might take steps to understand your triggers, change your behavior, and rein in the outflow of money.

•   Living on a budget may also require looking at the bigger picture and finding places for more significant savings. For example, maybe rent eats up 50% of your income, and it’d be better to move to a less costly apartment. Or you might want to consider trading in an expensive car lease for a less pricey or pre-owned model.There may also be opportunities to lower some of your recurring expenses by finding a better deal or negotiating with your service providers.

You may also want to look into any ways you might be able to change the other side of the equation — the inflow of funds.

•   One option could be asking for a raise.

•   Another could be training for a higher-paying field.

•   Or you might find an additional income stream (making more money is a key benefit of a side hustle).

The Takeaway

One of the most important steps towards achieving financial wellness is cash flow management — i.e., making sure that your cash outflow is not exceeding your cash inflow.

Creating a simple cash flow statement can show you exactly where you and your money stand. It can also help you create a budget that can give you greater control over your finances and achieving your goals.

If you need help tracking your spending, banking with SoFi may be a good option for you.

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

How do you create a personal cash flow statement?

To create a personal cash flow statement, gather information on how much you typically take in (income) after taxes per month and how much your outflow (spending and saving) is. That captures the amount you spend on necessities, like housing and food, as well as wants and debt payments. When you subtract the outflow from the income, you’ll see where your cash flow stands.

What is the importance of a personal cash flow statement?

A personal cash flow statement is an important way to track your personal spending and see where pain points may be. It will also reveal if you are going into debt or if you have surplus funds you can put towards future goals. Also, a personal cash flow statement can be an important factor in establishing your budget.

What is the difference between a personal balance sheet and a cash flow statement?

A personal balance sheet captures your assets (money in the bank and real estate, for instance) and liabilities (your credit card balance and any loans), which allows you to determine your net worth. A cash flow statement, on the other hand, tracks your spending versus your income, to see whether you are operating with a deficit, a surplus, or if you are breaking even.

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.

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.

*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.

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

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.

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

SOBNK-Q324-025

Read more
Jul
26
2024
pile of coins

What Are Penny Stocks & How Do They Work?

By | Growing Wealth, invest, Investing | No Comments

Penny stocks are shares of companies that usually trade for less than $5 per share. They are highly speculative investments, meaning they carry a high degree of risk. Usually, traders looking for short-term gains use penny stocks, rather than long-term investors looking to build wealth.

But investors are often allured by penny stocks because they are relatively cheap and offer the prospect of high returns – but there are significant risks associated with penny stocks, too. Before trying to use penny stocks to make quick gains, investors must know how they work and the risks involved.

What Are Penny Stocks?

Penny stocks are low-priced financial securities that trade for less than $5 a share, though they often trade for less than $1.

Penny stocks are generally considered to be highly speculative, or relatively higher-risk investments. This is because most penny stocks are issued by small, unknown companies with little or no operating history. In addition, these companies often lack the financial resources to continue operating for very long and are susceptible to fraud.

​​Despite the risks, some investors are attracted to penny stocks because they offer the potential for significant returns over a short period of time. For example, if a penny stock’s price doubles from $0.30 per share to $0.60 per share, that’s a 100% return on investment on just a $0.30 price increase. Of course, the flip side is that you could possibly also lose all of your investment just as quickly.

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.

*Probability of Member receiving $1,000 is a probability of 0.028%.

Exploring Penny Stocks & How They Work

Although some penny stocks trade on major exchanges, such as the New York Stock Exchange or Nasdaq, most penny stocks trade on the over-the-counter (OTC) market, through the OTC Bulletin Board (OTCBB) or on the pink sheets.

Penny stocks that trade on the OTC market do not have the same regulatory requirements as companies listed on major exchanges. Companies that list their shares on the major exchanges are subject to a high degree of regulatory scrutiny; these publicly traded companies must meet minimum listing standards and provide regular financial reports to the Securities and Exchange Commission (SEC).

In contrast, over-the-counter stocks have fewer hoops to jump through, as they do not have to meet minimum listing requirements. However, penny stocks that trade on the OTCBB must file financial statements with the SEC, while penny stocks listed on the pink sheet are not required to do so.

Because many penny stocks do not have to report periodic financial statements to a regulatory agency, it can be difficult for investors to find adequate information to make informed investment decisions on these securities. This lack of knowledge is one of the reasons penny stocks tend to be higher-risk investments.

Penny Stocks Are Highly Speculative

As noted above, penny stocks are highly speculative investments often bought and sold by traders who want to make short-term gains. Because of this potential for significant, short-term gains, many people view penny stocks as a way to generate outsized returns quickly. However, this is far from the case; penny stocks tend to carry a high degree of risk and, as such, may be better investment options for investors with the time, money, and risk tolerance to dabble in this market.

Recommended: The Difference Between Speculation vs. Investing

Who Can Buy Penny Stocks?

Anyone can buy and sell penny stocks, though it is recommended that they have the appropriate risk tolerance before investing in these speculative securities.

To trade penny stocks, you’ll need to open an account with a brokerage that offers OTC trading. Many online brokers offer this service, but do your research before selecting one, including what kind of fees they charge. Once you have an account, you can start buying and selling penny stocks.

Pros of Penny Stocks

Penny stocks may be attractive to investors for a couple of key reasons.

High Reward Potential

There is a belief by some penny stock traders that these small securities have more room to grow than large stocks, thus resulting in significant, short-term price appreciation. The potential for short-term gains means that penny stocks may provide high rewards, despite their risks, especially if traders utilize buying on margin to make their trades.

Enjoyment

Just as some people like to gamble, others like to trade stocks and other securities for fun. Plenty of people would consider analyzing stock charts, reading up on unknown companies, and making bets as one of their hobbies. Traders like this might consider penny stocks as “fun spending,” not necessarily a part of a long-term investing strategy.

Cons of Penny Stocks

Penny stocks also have some drawbacks that investors should be aware of.

Small Likelihood of Success

Making money on a penny stock can be a rare occurrence. Investors should be aware of this, despite the tales of sudden wealth they may hear. Also, finding success trading penny stocks may often take longer than some investors expect or anticipate.

Possibility of Losing it All

A small likelihood of success means that there will inevitably be many failures. It is common for small, unestablished businesses to fold and go under, flounder, or have unsuccessful stock. When stocks become worthless, investors effectively lose all of their investment.

Lack of Liquidity

Penny stocks usually do not have a lot of liquidity, meaning it can be challenging to find buyers when you want to sell. This can make it hard to get out of a position if the stock price declines.

Volatility

Penny stocks tend to be highly volatile, which means that their prices can change a lot, rapidly. This can happen in either direction, making them a difficult tool for building long-term wealth.

Scammers

The penny stock segment of the market is often rife with scammers and fraudsters. Numerous penny stock newsletters promise big wins, and penny stock “investors” manipulate both the market and potential customers.

Researching Penny Stocks to Buy

It’s often difficult for investors to adequately research what penny stocks to buy and sell. Because many penny stock companies do not have to file reports to regulators, investors do not always have great information about the company’s finances, management, and operations.

One of the first things investors should do is check online resources like the OTC Markets website to search for company information on the penny stocks you’re interested in. Once you’ve done that, you can see if the companies have filed reports with the SEC through its EDGAR database. Using this company and financial information, you can develop a sense of the company’s finances and business practices.

Also, it may help to look at penny stocks that trade on exchanges such as the NYSE or NASDAQ. Because these stocks are required to file regular financial reports to the SEC, there is more easily accessible research investors can use to make investment decisions. Additionally, these companies are usually more stable and have more liquidity than penny stocks trading on the pink sheets or OTCBB.

Overall, you’d want to review as much public information as possible when researching penny stocks to buy and sell. When you make investment decisions with inadequate public information, you may open yourself up to relying on shady information that could come from paid promoters or fraudsters looking to pump and dump a stock.

The Takeaway

The allure of making significant, short-term gains by trading penny stocks draws many people into the market. But with the potential of high rewards comes the increased risk and a probability that gains will be hard to come by. Before diving into penny stock trading, assessing your risk tolerance is essential to see if this strategy is right for you.

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).

For a limited time, opening and funding an Active Invest account gives you the opportunity to get up to $1,000 in the stock of your choice.

FAQ

Can you make money with penny stocks?

While making money with penny stocks is possible, it is also possible to lose money. Penny stocks are generally considered a high-risk investment, and as such, they may not be suitable for all investors.

Are penny stocks good for beginners?

Trading penny stocks is likely not advisable for beginners, as they are often very volatile, difficult to research, and can be challenging to trade. It may be best to consult with a financial professional before trading penny stocks.

Are penny stocks popular investments?

Penny stocks are sometimes popular investments for traders looking for high-risk, high-reward investments. These stocks are typically very volatile, which can lead to significant profits or losses.

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.

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.

Claw Promotion: Customer must fund their Active Invest account with at least $25 within 30 days of opening the account. Probability of customer receiving $1,000 is 0.028%. See full terms and conditions.

SOIN-Q324-001

Read more
Jul
24
2024
Guide to Paying for Dental Care With a Credit Card

Guide to Paying for Dental Care With a Credit Card

By | Credit, Financial Independence | Comments Off on Guide to Paying for Dental Care With a Credit Card

Good dental health can be essential to your overall well-being, but the cost of dental work — even after dental insurance — can make it challenging to pay upfront. According to the American Dental Association (ADA), the average cost of a porcelain or ceramic crown is $1,213, while the cost of a root canal can range as high as $1,539 for a single session.

A dental credit card is a white-label version of a credit card intended to be used on dental care expenses. It is one way to cover these costs in smaller, more manageable installment payments. Although a credit card for dental work can serve as a useful financing tool, it’s also important to be mindful of the caveats of using credit for dental care.

What Is a Dental Credit Card?

A dental credit card is a credit card that’s designed specifically to pay for your out-of-pocket dental health care costs. These cards are typically offered in dental offices that accept the particular medical card it advertises as a form of payment.

Like a basic credit card, a dental credit card requires patients to undergo a credit check for qualification. The card’s use is limited to dental offices within the card issuer’s network for the purpose of financing your dental bills.

Dental care credit cards typically have high interest rates, even if they offer a temporary deferred interest period.

Recommended: Tips for Using a Credit Card Responsibly

How Do Dental Credit Cards Work?

Your dental provider’s office might mention a dental credit card as a payment option if you’re unable to cover the expense in one lump sum. Typically, the office facilitates the process of completing your application for credit approval, but it is not financing the cost directly. In other words, your dental office isn’t the lender.

Instead, credit for dental care is provided by a third-party credit card issuer. Similar to how a conventional credit card works, your application is reviewed by the issuer’s underwriting team, and your credit history and score are evaluated.

If you’re approved, the card issuer will send you a physical credit card that you can use for services at an in-network health care office up to your approved credit card limit. Your dental provider is paid in full by the card issuer, and you’ll repay the issuer through monthly payments, plus interest if you carry a balance.

Deferred Interest Periods on Dental Credit Cards

Some credit cards for dental work offer zero interest charges for a limited period, also called deferred interest. This option can be advantageous if you’re confident that you can successfully repay the full balance before the deferment period ends.

However, if there’s a remaining balance after the deferment period ends, interest charges that accrued throughout the deferment period are added to the principal balance that’s due. Additionally, the new higher balance continues to accrue interest charges at the dental credit card’s APR, or annual percentage rate.

Because of this, use medical credit cards for dental work cautiously, as it’s a high-interest financing option that can lead to higher medical debt if you’re unable to repay your dental expenses quickly.

Recommended: What Is a Charge Card

Choosing a Dental Credit Card

When applying for a credit card specifically for dental care expenses, make sure you ask about the card’s features, terms, annual percentage rate (APR), and how it calculates interest during and after any deferment period.

If you’re approved, ensure that your dental office provides you with a copy of your dental credit card’s disclosure agreement. Also pay attention to the agreed-upon amount for any dental services you receive so you can verify that the card was charged for the correct amount.

You’ll want to note the deferment dates for your card, if any, and the interest rate you’re offered. That way, you can make enough monthly payments to repay your balance in full before interest kicks in.

Paying for Dental Care If You Have Bad Credit

Getting approved for a dental care credit card might be challenging if you have bad credit. If you’re in a difficult position and need help paying for expensive dental work now, here are some options to explore:

•   Inquire about a low-fee payment plan. Even if your dental provider doesn’t typically offer payment plans, it’s worth asking. They might accommodate you.

•   Shop around with other dental providers. Prices vary across dental offices, so compare costs across a handful of affordable sources. You might consider a non-profit dental clinic or a dentistry school.

•   Seek help from a family member. Ask a relative if they’re willing to offer a low-interest loan for your dental care.

•   Explore local government programs. Some state and local governments offer low-cost dental care programs to residents.

Alternatives to Dental Credit Cards

If a dental credit card isn’t an option for you, there are a handful of other financing options to cover dental work, such as the cost of a root canal.

Credit Cards With 0% Interest Rates

Other types of credit cards, like a 0% APR card, are a good alternative to dental care credit cards. They offer a promotional period — sometimes from six months to 18 months — during which you don’t incur interest charges.

This kind of card may differ from deferred interest programs. With some promotional APR cards, interest only starts accruing on your outstanding balance after the promotional period ends. Still, the credit card rule applies to try to pay off your balance in full before the promotional period ends to avoid paying interest.

Payment Plans Through Your Provider

Some medical providers offer a payment plan at no additional cost or at a small installment fee. In this situation, you’re arranging low installment payments directly through your dental office until you’ve repaid your balance in full.

Not all dental offices offer this type of payment plan. But if yours does, it can work with you to create a custom monthly payment amount and due date that’s manageable for your finances.

Personal Loans

Compared to a dental credit card, personal loans might offer lower interest rates for qualified borrowers. A low-interest personal loan achieves the same result as a credit card for dental work in that you can chip away at your outstanding balance in small increments, plus interest.

Among the main differences: You’ll receive a lump-sum loan disbursement from your lender that can be used to pay your dental office upfront. Also, you may find that a personal loan has a lower interest rate than what a credit card would charge you.

Recommended: How to Avoid Interest On a Credit Card

Help From Relatives

Seeking financial assistance from a close relative can help you avoid dental care debt. When asking for help, clarify whether any available funds are a gift or need to be repaid.

If it’s the latter, discuss the repayment window and additional interest (if any). Also talk about expectations if you’re suddenly unable to make payments due to, say, an injury or job loss.

The Takeaway

Getting a credit card designed to pay for dental work can be useful if you’re faced with an urgent oral treatment or procedure and need fast financing. However, the high interest rates of credit cards for dental work compared to other financing options can make it a financially risky option.

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

FAQ

What credit score do I need to get a dental credit card?

Credit score requirements vary by credit card issuer, but generally, you’ll need at least fair credit. However, a higher score can help you qualify for more competitive interest rates.

Is a dental care credit card hard to get?

Dental care credit cards are commonly offered online or at your provider’s dental office, so applying for a card is typically straightforward. However, being approved for a dental credit card involves many factors, like your credit history, income, debt-to-income ratio, and other factors.

Should I pay for dental care with a credit card?

If you don’t have the cash flow to pay for your dental costs upfront, using a dental credit card helps you cover costs in small, monthly payments. That being said, doing so might cause you to incur high interest charges, so evaluate your financial situation and your options.

Can I get a dental loan with bad credit?

Dental loans for patients with bad credit are available, though they might come with high interest rates, low limits, or other restrictive factors.

Photo credit: iStock/zadveri

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.

SOCC-Q324-006

Read more
Jul
24
2024

What Happens to Credit Card Rewards When You Die?

By | Credit, credit card, Family Finances | Comments Off on What Happens to Credit Card Rewards When You Die?

If you work hard amassing miles and points, it’s worthwhile to know that while some credit card rewards die with you, there are issuers who allow redemptions or transfers after death.

Here’s a closer look at what happens to credit card rewards when you die, as well as what steps you can take to avoid forfeiting your rewards.

What Are Credit Card Rewards?

Credit card rewards are a type of currency that can come in the form of credit card points, miles, or cash back rewards. They’re designed to incentivize cardholders to make eligible purchases on their rewards credit card.

As you make purchases and earn various credit card rewards, you can choose to hold onto the rewards in your account until you have enough to redeem toward a high-value purpose. Each rewards program lets cardholders redeem rewards in different ways, depending on its rules. Common redemption options include statement credits, travel bookings and reservations, special experiences, merchandise, gift cards, and more.

Recommended: Tips for Using a Credit Card Responsibly

What Happens to Your Credit Card Rewards Upon Death?

Having a stockpile of credit card rewards after death might lead to a sticky situation for your surviving family. Akin to your credit card debt after death not passing on to your survivors in some states, some credit card rewards “die with you” and can’t be redeemed or transferred to your family or estate.

Conversely, some credit card issuers, like American Express, offer a limited period during which authorized trustees of your estate can redeem unused rewards. Certain programs that permit reward redemptions or transfers after death might require the outstanding account balance to be paid in full.

In other words, what happens to your credit card rewards after you pass on depends on the terms laid out in your rewards program agreement. Some rewards terms specifically state that rewards aren’t the property of the cardholder and can’t be transferred through inheritance.

Recommended: What Is the Average Credit Card Limit

What To Do With Credit Card Rewards if the Account Holder Dies

If you know that your deceased loved one amassed credit card points, miles, or cash back rewards, there are a few steps you can take to address it:

1.    Check on accounts and rewards balances. If your deceased loved one gave you access to their account before their death, log in to get an overview of their remaining rewards balances across all accounts. If you don’t have access to their accounts, proceed to the next step.

2.    Prepare paperwork. You’ll likely need to provide proof of the primary cardholder’s death, such as a copy of their death certificate. Additionally, you might need to provide the name and contact information of the authorized trustee, letter of testamentary, or other details.

3.    Contact the card issuer. You must inform the card issuer in the event of a primary cardholder’s death. Supply the necessary documentation you’ve gathered, and inquire about your options to redeem the rewards.

Generally, credit card companies offer at least one of a few options, though how a credit card works will vary by issuer. The rewards might be forfeited if they’re non-transferable or expire upon the cardholder’s death. Some credit card terms automatically convert the rewards into a statement credit, while other issuers allow rewards redemption or transfers to another existing, active account.

Ways You Can Avoid Forfeiting Your Credit Card Rewards

You’re ultimately at the mercy of a reward program’s user agreement in terms of what to do with credit card rewards after death. However, planning ahead can help you avoid relinquishing earned rewards.

Not Hoarding Your Points

To avoid facing a scenario in which your credit card rewards die with you, make an effort to redeem credit card points or miles on a rolling basis.

For example, at the end of each year, use credit card rewards to travel for less money or apply them to your account as a statement credit. Keep in mind that different redemption options have varying valuations, so look into which redemption strategy makes sense for your situation.

Choosing Cards With Favorable Death Terms

Although a particular program might offer enticing rewards — such as the chance to enjoy credit card bonuses — it might not be advantageous if the program has strict terms regarding a cardholder’s death.

American Express, for instance, has relatively lenient terms when dealing with the rewards balances of a deceased cardholder.

Recommended: How to Avoid Interest On a Credit Card

Using a Reward-Tracking Tool

If you have multiple rewards credit cards in your rotation, using a reward tracking app can help you and your surviving family organize and track your rewards. Apps like AwardWallet and MaxRewards can let you easily see all of your rewards in one view.

Naming a Beneficiary in Your Will

Although it’s not a foolproof way to avoid forfeiting your credit card rewards, adding a beneficiary to your will is a smart move. This way, if your card issuer allows rewards transfers or redemptions by authorized individuals, your beneficiary is formally named on your estate documents as your desired recipient.

The Takeaway

Since there’s no way to know when an accident or unforeseen health issue will result in your death, it’s best to be prepared. If possible, redeem earned credit card rewards in a timely manner so you can enjoy them in life. Or consider such steps as naming a beneficiary in your will or racking up rewards on a card with lenient transfer policies.

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

FAQ

Can I transfer points from the account of a late family member?

Whether you’re allowed to transfer points from your deceased relative’s rewards credit card account depends on the card program’s rules. Some banks allow points transfers, while other programs state that points are non-transferable. Contact the card issuer’s customer support team to learn about its point transfer policy.

Can an authorized user use credit card rewards upon the death of the account owner?

It depends. Not all credit card rewards programs allow authorized users to use a primary cardholder’s earned rewards. Those that do might have restrictions on how and when rewards can be redeemed after a primary user’s death, if at all.

What happens to the miles when someone dies?

Miles earned by a deceased primary credit card rewards cardholder might be forfeited, transferred, or redeemed by the estate or surviving family, depending on the rewards program. Terms vary between card issuers, and even across travel rewards programs, so call the program’s support team to learn about its terms.

Can estates redeem points after death?

Some rewards credit cards allow estates to redeem points after the primary cardholder’s death. American Express, for example, allows estates to request points redemption by submitting a formal written request with documentation.

Photo credit: iStock/supatom

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.

SOCC-Q324-008

Read more

CATEGORIES

  • All
  • No categories
Close modal

See what SoFi can do for you and your finances.

Select a product below and get your rate in just minutes.

Student Loan
Refinancing

Personal
Loans

Online
Investments

Other

Terms and conditions apply. SOFI RESERVES THE RIGHT TO MODIFY OR DISCONTINUE PRODUCTS AND BENEFITS AT ANY TIME WITHOUT NOTICE. To qualify, a borrower must be a U.S. citizen or other eligible status, be residing in the U.S., and meet SoFi's underwriting requirements. Not all borrowers receive the lowest rate. Lowest rates reserved for the most creditworthy borrowers. If approved, your actual rate will be within the range of rates at the time of application and will depend on a variety of factors, including term of loan, evaluation of your creditworthiness, income, and other factors. If SoFi is unable to offer you a loan but matches you for a loan with a participating bank, then your rate may be outside the range of rates listed above. Rates and Terms are subject to change at any time without notice. SoFi Personal Loans can be used for any lawful personal, family, or household purposes and may not be used for post-secondary education expenses. Minimum loan amount is $5,000. The average of SoFi Personal Loans funded in 2023 was around $33K. Information current as of 2/26/24. SoFi Personal Loans originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org). See SoFi.com/legal for state-specific license details. See SoFi.com/eligibility for details and state restrictions.

✝ 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.

©2024 Social Finance, LLC All rights reserved.
TLS 1.2 Encrypted
Equal Housing Lender