Credit cards are one of the most accessible credit-building tools in your arsenal, but rewards are also part of the appeal. A statement credit is one way to redeem rewards you’ve earned.
If you look through your statement balance and find that money was put back into your account, that’s a statement credit.
Knowing how you earned that money can help you take advantage of your credit card’s rewards system in the future.
What Is a Statement Credit?
Credit card companies use a statement credit to issue a credit to your accounts, such as cash back or other rewards you have earned. Essentially, you receive money from your card issuer for a specific reason.
Finding documentation of your statement credit varies among credit card companies. Generally, though, you will see it on your monthly statement under transactions or account activity.
If you check your statements online, you’ll probably see the credit appear in green text.
Regardless of the format, a statement credit has a minus sign in front of the cash amount, thus decreasing your revolving balance.
How to Receive Statement Credits
There are a few ways a statement credit might apply to your account. A common reason is through a return.
If you have ever returned an item you bought using your credit card, the retailer will probably refund the money borrowed from your card issuer. You’ll receive a statement credit that matches the price of the returned item.
Other than returns, ways you may receive a statement credit include:
• Shopping benefits. Some card providers offer discounts or statement credits for shopping with specific merchants.
• Travel credits. Card providers may offer annual statement credits to pay for eligible travel expenses like a luggage fee or plane tickets.
• Rewards. Card providers that offer cash back, points, or miles may let you redeem them in the form of a statement credit.
Statement Credits vs. Cash Back
Your credit card company gives you options when you sign up for a rewards credit card. One choice may be cash back or statement credits.
Cash back sounds simple enough, but it doesn’t always mean you’ll get direct money. Instead, your issuer may offer a cash reward in the form of a credit put on your account. Occasionally, they may send you a physical check or deposit the money in your checking account.
You earn cash back as a reward for using the credit card. It is a percentage of the money spent on purchases using the card.
In comparison, a statement credit reduces your credit card balance. Carrying a high balance between periods could lead to a high credit utilization ratio, which shows the amount of available credit a person has. That can result in a lower credit score over time.
Are Statement Credits Taxable?
The type of credit or reward you receive determines whether it’s taxable. If the credit card holder spent money to earn the reward, they usually don’t have to pay taxes on it. If they receive the credit without any spending, the reward may be taxable.
For example, an individual receives money back on her account after returning a chair she purchased online. That credited amount would not be taxable.
Cashback earners who engage in programs for points, like travel rewards, also generally avoid taxation.
The primary instance where cardholders face a taxable reward is with sign-up bonuses.
If they did not have to purchase anything to earn the bonus, it’s probably taxable. The taxation may apply regardless of how the credit card company issues the bonus, whether it’s in cash or airline miles.
Consider using statement credits put on your account to lessen your balance. Or look into the various rewards your card issuer offers.
You may even be among the 23% of Americans who didn’t redeem any of your stockpiled rewards in 2022. So you might be missing out on rewards that you could use for some of your favorite services.
When shopping for a new card, you may want to look closely at the points, cash back, or miles involved. How are the rewards offered, how are they redeemed, is it better for you to get a card with consistent points across all purchases or increased rewards in certain areas?
Think through which rewards best fit your lifestyle and interests. If you want to see the world, you may want to get a card that optimizes travel benefits. If you’re an investor or someone interested in student loan refinancing, at least one card is geared toward those preferences.
The Takeaway
What is a statement credit? It’s a reduction in a credit card balance. Many credit cards offer statement credits as one way to redeem travel, cashback, or other rewards.
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.
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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A clearinghouse is a financial institution that acts as a middleman between buyers and sellers in a market, ensuring that transactions take place even if one side defaults.
If one side of a deal fails, a clearinghouse can step in to fill the gap, thus reducing the risk that a failure will ripple across financial markets. In order to do this, clearinghouses ask their members for “margin”–collateral that is held to keep them safe from their own actions and the actions of other members.
While often described as the “plumbing” behind financial transactions, clearinghouses became high profile after the 2008 financial crisis, when the collapse of Lehman Brothers Holdings Inc. exposed the need for steady intermediaries in many markets.
Regulations introduced by the Dodd-Frank Act demanded greater clearing requirements, turning the handful of clearinghouses in the country into some of the most systemically important entities in today’s financial system.
Here’s a closer look at them.
How Clearinghouses Work
Clearinghouses handle the clearing and settlement for member trades. Clearing is the handling of trades after they’re agreed upon, while settlement is the actual transfer of ownership–delivering an asset to its buyer and the funds to its seller.
Other responsibilities include recording trade data and collecting margin payments. The margin requirements are usually based on formulas that take into account factors like market volatility, the balance of buy-versus-sell orders, as well as value-at-risk, or the risk of losses from investments.
Because they handle investing risk from both parties in a trade, clearinghouses typically have a “waterfall” of potential actions in case a member defaults. Here are the layers of protection a clearinghouse has for such events:
1. Margin requirements by the member itself. If market volatility spikes or trades start to head south, clearinghouses can put in a margin call and demand more money from a member. In most cases, this response tends to cover any losses.
2. The next buffer would be the clearinghouse’s own operator capital.
3. If these aren’t enough to staunch the losses, the clearinghouse could dip into the mutual default fund made up from contributions by members. Such an action however could, in turn, cause the clearinghouse to ask members for more money, in order to replenish the collective fund.
4. Lastly, a resolution could be to try to find more capital from the clearinghouse itself again–such as from a parent company.
Are Clearinghouses Too Big to Fail?
Some industry observers have argued that regulations have made clearinghouses too systemically important, turning them into big concentrations of financial risk themselves.
These critics argue that because of their membership structure, the risk of default in a clearinghouse is spread across a group of market participants. And one weak member could be bad news for everyone, especially if a clearinghouse has to ask for additional money to refill the mutual default fund. Such a move could trigger a cascade of selling across markets as members try to meet the call.
Other critics have said the margin requirements and default funds at clearinghouses are too shallow, raising the risk that clearinghouses burn through their buffers and need to be bailed out by a government entity or go bankrupt–a series of events that could meanwhile throw financial markets into disarray.
Clearinghouses in Stock Trading
Stock investors have already probably learned the difference between a trade versus settlement date. Trades in the stock market aren’t immediate. Known as “T+2,” settlement happens two days after the trade happens, so the money and shares actually change hands two days later.
In the U.S., the Depository Trust & Clearing Corp. handles the majority of clearing and settling in equity trades. Owned by a financial consortium, the DTCC clears on average more than $1 trillion in stock trades each day.
Clearinghouses in Derivatives Trading
Clearinghouses play a much more central and pivotal role in the derivatives market, since with derivatives products are typically leveraged, so money is borrowed in order to make bigger bets. With leverage, the risk among counterparties in trading becomes magnified, increasing the need for an intermediary between buyers and sellers.
Prior to Dodd-Frank, the vast majority of derivatives were traded over the counter. The Act required that the world of derivatives needed to be made safer and required that most contracts be centrally cleared. With U.S. stock options trades, the Options Clearing Corp. is the biggest clearinghouse, while CME Clearing and ICE Clear U.S. are the two largest in other derivatives markets.
The Takeaway
Clearinghouses are financial intermediaries that handle the mechanics behind trades, helping to back and finalize transactions by members.
But since the 2008 financial crisis, the ultimate goal of clearinghouses has been to be a stabilizing force in the marketplace. They sit in between buyers and sellers since it’s hard for one party to know exactly the risk profile and creditworthiness of the other.
For beginner investors, it can be helpful to understand this “plumbing” that allows trades to take place and helps ensure financial markets stay stable.
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Starting salaries can vary greatly based on location or line of work, so there’s no one answer to the question, “What is a good entry level salary?” The size of the paycheck will differ based on where someone lives, the industry they work in, the hiring institution or company, and other hard-to-tabulate variables.
So, how might a job seeker figure out a good entry level salary before sitting down with the new boss or an HR representative to discuss pay? Here are some helpful resources to get a handle on entry level rates across the U.S., including tips for negotiating compensation.
Understanding Entry Level Salaries
Entry level salary information changes on a regular basis, but many job-focused websites offer insights into the going rates. For instance, ZipRecruiter, a well-known American employment marketplace, lists the average U.S. entry level salary by state. In summer 2023, wages in North Carolina are $13.44 per hour or $27,956 per year, whereas New York pays $16.79 per hour or $34,933 per year, on average.
Still, even state-by-state averages don’t show the whole picture. Although more than half of U.S. states have minimum wage requirements higher than the federal minimum wage, which remains set at $7.25 per hour, the amount an early-career new hire might expect can also vary by county and city within the same state.
Along with location, the industry one works in can play a big role in what kind of starting salary a new hire might expect. For instance, a data scientist at a tech company might be able to earn as much as $95,000 right out of the gate, while a newly minted journalist might expect something closer to $40,000.
One way to grasp what sort of salary that might be expected is targeted research on the specific industry, location, and even position and company. And if you’re in the early stages of college, you might want to align your eventual courses of studies with a high-paying entry level job.
Researching a Good Entry Level Salary
Recent grads wanting to understand if they’re being offered current market rates for a particular job (or location) can turn to the internet to research details. Some sites that might offer resources for those job seekers include:
• Payscale, for example, allows employees to create custom “pay reports” based on their job title, years of experience, and city.
• Salary.com offers a similar feature, allowing job seekers to search for positions by keyword and compare them accordingly.
• Glassdoor is another well-known web resource that publishes employee-generated information on salary by specific company and position. It also hosts reviews by current and former employees, which may help a job applicant learn more about what it’s actually like to work there.
After researching average pay by role, location, and company, job seekers might also want to mull over how to negotiate an acceptable offer.
So, what can a job seeker do if their dream job doesn’t (initially) come with a dreamy paycheck? Luckily, there are ways to negotiate a higher offer both initially and once you’ve proven yourself down the line.
Negotiating a salary can be scary, especially for a recent grad who’s not used to the salary tango. Nevertheless, negotiating an offer up front can have a significant effect on one’s paycheck (and, by extension, one’s long-term earnings).
When thinking of how to negotiate your starting salary, don’t forget about the benefits package, as well. In addition to higher pay, you may want to negotiate other benefits such as tuition reimbursement, a flexible schedule, or childcare expenses into your total compensation package.
Preparing to Negotiate
How might a new hire negotiate a higher-paid entry level salary? Well, having a well-researched entry level salary forecast in mind is one place to start.
Of course, it’s not likely that an early-career new hire can simply negotiate up to an experienced data scientist’s $95,000 salary if that’s not the norm for the role or location they’ve applied for. But, it’s still possible to make the case to hiring managers for why a higher rate is merited. When preparing to negotiate, remember to:
Highlight Your Skills
When asking for a higher starting salary, it could be helpful to give concrete examples of how your current skills might benefit the company. In these conversations, it may be possible to push an offer up a few percentage points (especially when the skills required are in high demand).
Practice Your Pitch
Rehearsing what you’ll say ahead of time can help you hone a confident delivery style. What’s more, it can help you be prepared for questions that come your way regarding why you deserve a higher pay.
Negotiate Other Benefits
On top of baseline salary, it’s also possible in some roles and industries to negotiate for other valuable forms of compensation — such as fitness stipends, work-from-home time, funding for continued education, and more.
Of course, negotiating a good entry level salary is not necessarily an easy undertaking. Interviewers may put candidates on the spot, asking if they’re considering other offers or if the position is their top choice.
In an already uncomfortable situation, some candidates may stumble or misspeak if they don’t know how to justify what they’re asking for.
One simple place to start is asking whether it’s possible to negotiate the offer in the first place. Candidates may also inquire about future career growth and promotion potential, which could lead to a bigger salary later down the road.
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Navigating Post-College Life, Financially and Beyond
Navigating life after college can be exciting and challenging. Trying to make ends meet on an entry level salary might be particularly tough, especially when on the hook to pay back student loans. More than 43 million borrowers have federal student loan debt, with the average balance being $37,388 per person.
A flexible and adaptable approach to finances and where one lives could make the transition to post-college life more manageable.
For instance, recent graduates who are in a position to choose a new place to live might opt to move to a city with a lower cost of living.
Learning how to make a budget can also go a long way toward covering common expenses — even when one’s starting salary leaves a few zeroes to be desired. That said, there’s only so much instant ramen to eat or cups of coffee to skip out on.
Refinance Student Loan Debt
For those feeling weighed down by student loans while earning an entry level salary, additional options exist. Those with outstanding federal student loans, for example, may qualify for income-driven repayment plans, loan forgiveness for public service, or student loan deferment.
Refinancing educational debt with a private lender is another option that could save money each month — or help the borrower pay off student loans faster.
Student loan refinancing may allow recent grads to make lower monthly payments toward their existing debt, freeing up some extra cash. (Note: You may pay more interest over the life of the loan if you refinance with an extended term.) Or, it could help a borrower to save money on interest paid on the loan as a whole, allowing them to pay off the debt total faster.
It’s important to note that refinancing with a private lender causes borrowers to forfeit certain guaranteed federal benefits, like income-driven repayment (IDR) and loan forgiveness.
SoFi refinances both federal and private student loans, offering no application fees and no prepayment penalties. Those who refinance their student loans through SoFi get access to a wide range of exclusive member benefits, including career coaching, financial advice, and more — at no additional cost.
Checking your student loan refinance rate won’t have an affect on your credit score and could be the first step toward saving thousands of dollars — or making more affordable monthly student loan payments.
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Just like having your home in order can make life easier and less stressful, having your financial house in order can save you time and worry. It can also help you spend less, save more, and work more effectively towards your financial goals.
Your “financial house” refers to all the aspects that go into your financial wellness, including the information found on your financial statements, any debt you have, your budget, and your retirement planning and accounts.
Getting your financial house in order typically involves taking stock of what you have, getting rid of things (or accounts) you don’t need, creating a budget, and setting up a few systems to make it easy to achieve your financial goals.
Below is a simple step-by-step for doing a financial clean-up.
1. Taking Stock
You can’t organize what you have if you don’t fully know what you have, so a good first step is to track down all of your financial statements and accounts, or access them online. If the password or log-in is long forgotten, you can reset your accounts or call customer service lines to get access.
You can then make a master list organized by category. This might include:
• Assets This includes traditional and online bank accounts, retirement savings, and other investments.
• Liabilities These are loans, such as mortgages, credit card debt, student loans, or other forms of personal debt.
• Income This would include all sources of income, such as salary, investments, and alimony.
• Fixed expenses These are bills you pay every month, such as rent, mortgage, and utilities.
This step can help you discover unpaid bills, as well as savings accounts or retirement accounts you may have forgotten about.
2. Clear the Clutter by Going Paperless
Electing to go paperless on bills and bank statements is not only good for the planet, but can also help you keep your finances in order by creating less physical mess. Getting bills in the mail and seeing them pile up can also evoke a sense of dread. In addition, some banks offer benefits to customers who sign up for paperless billing.
When you go paperless, you can designate a day for tackling monthly expenses. Then, on that day only, you can open those emails and pay them. If you prefer a paper trail, you can print out your receipts and file them away.
3. Consolidating Accounts
Having abandoned 401(k) accounts or multiple saving accounts across different banks can be confusing and hard to keep track of. If this is the case, it might be time to consolidate and simplify.
You can move old savings into more frequently used accounts by transferring money from one account or bank to another. You may also be able to roll over your 401(k) from a former employer into a new employer’s retirement plan.
While this step isn’t necessary, tidying up accounts can save you the hassle of dealing with statements and notifications from several different financial institutions.
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4. Tackling Debt
Once you’ve taken stock of your overall financial picture, you will likely have a better sense of how much money you owe. This can feel overwhelming, but also empowering. Once you know the numbers, you can deal with them head on, and come up with a debt reduction plan.
You may want to first determine “good” debt, such as student loans and mortgages vs. “bad” debt, like high-interest credit card debt and personal loans. When paying off debt, it can be a good idea to prioritize bad debt first.
There are a number of different ways to make paying off debt feel manageable, such as the snowball method or avalanche method. The key is to find an approach you feel you can stick with and to simply get started.
As you knock off debts, you’ll have fewer minimum payments to juggle. What’s more, you’ll be able to funnel the money you once spent on interest towards your financial goals.
5. Creating a Budget
After you’ve taken stock of all of your accounts and bills, you may want to go one step further and set up a monthly budget.
To do this, it can be helpful to pull out the last three months or so of your bank statements. You can then use them to figure out how much is coming in each month (your average monthly income after taxes are taken out) and how much is going out each month (your average monthly spending).
If the numbers are tight (meaning there’s little or nothing left over to put into savings), or you see you are actually going backwards, you may next want to create a plan to cut your spending.
This might include getting rid of certain monthly bills, such as streaming services you no longer really care about or quitting the gym and working out at home.
You may also want to set monthly spending targets, such as how much you will spend on nonessential categories, such as clothing, eating out, and entertainment, each month.
6. Setting Goals
Setting some financial goals can help motivate you to stick to your budget and put money into savings each month.
If you’re saving up for something fun (like, say, a vacation), you might be more inclined to cook at home instead of ordering in. Money goals can function like a compass that guides the direction of spending.
Not sure of a goal? Here are some common financial goals you may want to consider working toward:
• Putting money towards something fun, like a vacation or new wardrobe.
Goals won’t always look the same person to person, but having one (or two) can help guide your financial plan, making it easier to spend and save with confidence.
7. Automating
Saving, spending, and paying bills doesn’t have to mean reinventing the wheel every month. You can significantly reduce the amount of work involved in money management simply by relying more on automation.
One of the benefits of automating your finances is always paying your bills on time. This can save you money by avoiding late fees. Having a history of on-time payments can also help improve your credit.
In addition to setting up autopay for your regular bills, you may also want to automate savings. This means having a portion of your paycheck (and it’s fine to start small) automatically transferred from your checking account into your savings or retirement account after you get paid.
This ensures that saving will happen each and every month, since the money will be taken out before you have a chance to see it — or spend it.
Automation won’t take all the work out of keeping your financial house in order, but it can eliminate many of the chores — and many of the choices — you have to deal with each month.
The Takeaway
Getting your financial house in order isn’t as complicated or time-consuming as many people assume. And, you don’t have to do it all at once. You may want to set aside an hour or so one day a week to focus on financial house-cleaning, and just take it one step at a time.
Tidying up your financial home can take work, but you don’t have to go at it alone. A SoFi Checking and Savings Account can make the complicated a little easier. With SoFi, you can earn a competitive annual percentage yield (APY) and save and spend, all in one account. And SoFi Checking and Savings doesn’t have any account fees which could eat away at your savings.
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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.
Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .
Mapping out your financial future can be daunting, especially if you only have a vague sense of what you want to accomplish.
It can be useful to consider financial milestones to help you chart out your journey from college graduation through retirement. Here’s a look at some common savings goals by age to help you orient yourself and build a plan.
Savings Goals for Your 20s
In your 20s, people are often just out of school, starting a career, and getting their life in order. As if that wasn’t enough, challenges like student loan debt or credit debt may face them. Now is the time to set financial goals, consider an investment strategy, and start building healthy financial habits.
Paying off High Interest Debt
If you have any high-interest debt—debts of 7% or more—you might focus on paying it off. High-interest payments can cost you a lot over the life of a loan.
Credit cards, which often allow minimum payments that are much less than the total balance due, can be particularly costly as interest on the balance accrues. The more money going toward high-interest debt, the less you can focus on your savings goals.
Building Emergency Savings
At this age, people are often just getting on their own feet and might not have a lot of extra cash to stock away. Establishing a rainy day fund can be a useful savings goal. Generally, emergency funds contain at least three to six months worth of living expenses. This fund can help cover emergencies like unexpectedly needing to replace a car transmission, a trip to urgent care, or losing your income. Since you never know when you’ll need to access your emergency fund, consider saving it in an easily accessible vehicle, such as an online bank account.
Recommended: Planning your emergency fund? Our emergency fund calculator can assist you in setting the right target.
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Saving for Retirement
The earlier you start investing for retirement, the longer you can take advantage of the powers of compounding interest — the returns you earn on your investment returns.
Compounding interest helps your investments grow exponentially. Consider taking advantage of any retirement accounts your employers offer, such as a 401(k). If your employer doesn’t offer a retirement plan, there are other options, such as setting up an individual retirement account (IRA), where you can save for retirement in a tax-advantaged way on your own.
Savings Goals for Your 30s
In your 30s, people are often more settled into a career path and may be thinking about other goals such as purchasing a house or having kids.
More Saving for Retirement
As your income grows and retirement gets a little bit closer, consider increasing the amount you’re setting aside for retirement. If your employer offers a match to your 410(k) contributions, taking advantage of the match can be a wise move, since this is essentially free money.
Buying a Home
If you’re thinking about buying a home, you’ll want to focus on saving for a down payment. The amount you will need to save will depend on housing prices in the area where you’re looking to buy. A larger down payment can make it easier to secure a mortgage, and can also mean that you pay less interest over the life of the loan.
Also, lenders may require borrowers to have mortgage insurance if they’re making a down payment smaller than 20%, which is an added expense to the home-buying process.
Setting up College Funds
If you have children, another consideration is saving for their college education. One way you can do this is to open a 529 college savings plan that helps you save for your child’s tuition and other education-related expenses. Just be sure not to neglect other long-term goals, such as retirement, while saving for your child’s college education.
Savings Goals for Your 40s
As you enter your forties, you are likely entering your highest earning years. If you have your high-interest debts behind you, you can devote your attention to building your net worth.
Keeping an Eye on Your Emergency Fund
The amount of money you needed to cover six months worth of expenses in your 20s is likely far less than what you need now, especially if you have a mortgage to pay and children to support. You’ll want to make sure that your emergency fund grows with you.
Protecting Your Assets
Now that you have a more substantial income and own some valuable things, such as a home and a car, you’ll want to make sure you protect those assets with adequate insurance. Home and auto insurance protect you in the event that something happens to your house or your car.
You may also want to consider getting life insurance if you haven’t already. This can provide a cash cushion to help your family replace your income or cover other expenses should you die. The younger you are when you purchase life insurance, generally the less expensive it will be.
Savings Goals for Your 50s
In your 50s, you’re likely still in your top earning years. You may still be paying off your mortgage, and your kids may now be out of the house.
Taking a Closer Look at Retirement Savings
As retirement age approaches, you’ll want to continue contributing as much as you can to your retirement account. When you turn 50, you are eligible to catch-up contributions to your 401(k) and IRAs.
These contributions provide an opportunity to boost your retirement savings if you haven’t been able to save as much as you hoped up to this point. Even if you have been meeting your savings goals, the contributions allow you to throw some weight behind your savings and take full advantage of tax-advantaged accounts in the decade before you may retire.
Continuing to Pay Off a Mortgage
If you think your monthly mortgage payments may be too high to manage on a fixed income, you might consider paying off or refinancing your mortgage before you retire.
Goals for Your 60s
As you enter your 60s, you may be nearing your retirement. However, when it comes to saving, you don’t have to slow down. As long as you are earning income, you might want to keep funding your retirement accounts.
Thinking Long-Term
Now is a good time to assess how much you have saved for retirement and perhaps adjust what you are contributing (based on how much you’ve already put aside and how much you can afford). At the same time, you may want to plan out a retirement income strategy, which is when you’ll start withdrawing funds and how much you’ll take each month or year. You’ll also want to decide when to start taking Social Security.
The Takeaway
Everyone’s personal timeline is different. The milestones you hit and when you hit them may vary depending on your personal situation. For example, someone graduating from college with $50,000 in student loan debt is at a very different starting point than someone who graduates with no debt. And while someone might be able to buy a house in their early 30s, others may live in a more expensive area and need more time to save.
No matter your starting point and situation, a simple way to manage your finances at any age is to open a checking and savings account where you can spend, save, and earn all in one product. With a SoFi Checking and Savings account, you’ll earn a competitive annual percentage yield (APY) and pay no account fees, both of which can help your money grow faster.
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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.
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