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Updated on Wednesday, February 26, 2020
Best known for its student loan refinancing products, SoFi also offers a cash management account, SoFi Money. This account offers a unique fusion of checking and savings accounts, with a very competitive APY and impressive amounts of FDIC insurance.
What is SoFi Money?
SoFi Money is a cash management account that combines the liquidity of a checking account with the interest-earning potential of a high-yield savings account — sans fees or stringent requirements. Similar to other fintech cash management accounts, like Aspiration Spend & Save and Betterment Everyday, SoFi utilizes a network of partner banks to hold the funds deposited in SoFi Money.
One characteristic that differentiates SoFi Money from competitors: It’s a single account, lacking the division between savings and checking common with some other cash management accounts. SoFi Money pays 0.25% APY on your entire balance (as long as you have $500 or more in recurring monthly deposits); some competitors only pay an APY on the funds held in savings.
SoFi Money sweeps your funds into accounts held at its partner banks, which provide Federal Deposit Insurance Corp. (FDIC) insurance on up to $1.5 million in deposits. However, it’s worth noting that the amount of FDIC insurance coverage can vary if you already have other assets in accounts at one or more of the partner banks. SoFi Money’s partner banks include:
- MetaBank — Sioux Falls, S.D.
- HSBC Bank USA – New York, N.Y.
- Hills Bank and Trust Company — Hills, Iowa
- EagleBank — Bethesda, Md.
- East West Bank — Pasadena, Calif.
- TriState Bank Capital Bank — Pittsburgh, Pa.
- Wells Fargo Bank, N.A. — Sioux Falls, S.D.
How do you open a SoFi Money account?
To open a SoFi Money account, you must be a U.S. citizen or permanent resident and at least 18 years old with a physical U.S. address and a valid Social Security number. After signing up, you can transfer funds to your SoFi Money account from a linked bank account — just search for your bank and link your account, either by entering your username and password or by manually linking your routing and account numbers. With SoFi Money, you also have the option to set up direct deposits and to deposit checks in the account via the mobile app.
SoFi Money features
Your SoFi Money account comes with a Mastercard debit card, which lets you withdraw cash at ATMs displaying a Visa, Plus or NYCE logo. You can also send money to family and friends via a built-in peer-to-peer payments feature. The account offers bill pay services and physical paper checks. You may move money into and out of the account via ACH transfers on the mobile app.
SoFi Money boasts bells and whistles that many standard bank accounts don’t. Noteworthy features include:
- SoFi membership benefits (more on that below)
- No regular maintenance fees
- No overdraft fees
- If your SoFi debit card purchase or ATM withdrawal is in a foreign currency, SoFi covers the 0.90% foreign convenience fee charged by Mastercard
- No foreign transaction fees (SoFi covers the 1% foreign exchange fee charged by Visa)
- No minimum required opening deposit
However, there are also caveats to consider when evaluating SoFi Money. First, FDIC coverage does not apply right away — your funds are only protected once they arrive at the partner bank they are swept into, which could take up to two business days. Additionally, there are some fairly restrictive withdrawal limits, which we detail below.
Is SoFi Money a checking account or savings account?
SoFi Money is neither a checking account nor a savings account — it’s a hybrid account type that has become an increasingly popular offering from fintech companies. Since most fintechs are not banks, they cannot secure FDIC insurance on their own. That’s why they use partner banks to hold your deposits.
The idea of cash management accounts is that they are a hybrid of checking accounts and savings accounts. While traditional savings accounts typically restrict withdrawals to six per month, cash management accounts like SoFi Money often offer unlimited withdrawals or transfers.
SoFi Money does offer a feature that lets you segregate funds for long-term savings, called Vaults. You can establish multiple Vaults to earmark money for different goals, but they are not separate accounts, only partitions within your account. You can’t withdraw money directly from a Vault — funds must first be transferred to your SoFi Money account before they can be accessed.
SoFi Money membership benefits
One of SoFi Money’s differentiating features is that it gives account holders SoFi membership benefits. These benefits are offered to customers of SoFi and are fairly encompassing. A few standout membership benefits include:
- Expert advice: SoFi Money membership provides personalized financial advice from credentialed advisors.
- Referral bonuses: Refer friends to SoFi and reap rewards.
- Deals and discounts: You’re eligible for rate reductions and discounts on your next eligible SoFi loan, as well as deals and discounts from companies that partner with SoFi.
- Access to events: You get access to local events and experiences, ranging from dinners to networking events.
- Career help: Receive access to career coaching and tools like a personalized action plan to help you get a raise.
SoFi Money transaction limits
SoFi Money has transaction limits, and while these limits are meant to prevent fraudulent activity, in some cases — like when traveling or making large purchases — they might feel a bit restrictive. However, the company does indicate that depending on its assessment of your account, these limits could be different or change over time.
|Type of transaction||Withdrawal limit|
|Peer-to-peer transfer||At least $1,000 per day, and $3,000 per month|
|Bill pay||$10,000 per transaction|
|ATM and point-of-sale cash withdrawal with debit card||$1,000|
|Over-the-counter cash withdrawal||$150|
|Point-of-sale spend limit||$6,000|
|Point-of-sale transactions per day||12|
SoFi Money pros and cons
You win some; you lose some. Such is true for the SoFi Money account. Here are a few noteworthy pros and cons of SoFi Money.
SoFi Money pros:
- Very minimal fees: SoFi Money offers a robust, fee-free structure that goes beyond just no monthly maintenance fees and no overdraft fees, which are common features of cash management accounts. In addition, it also charges no fees on services like replacement debit cards, inactive accounts, stop payments and return items.
- Supports joint accounts: You can easily open a joint account by clicking the “more” tab and “add joint account holder.”
- No overdraft fees: SoFi Money declines any transaction that would push your account balance into the red. Even better, if an overdraft occurs when the original transaction is approved but the amount that is actually charged is more, like when tipping at a restaurant, SoFi Money does not charge an overdraft fee.
- Compatible with other tools: SoFi Money is compatible with payment services including Venmo and PayPal, as well as Apple Pay and Samsung Pay.
SoFi Money cons:
- You can’t deposit cash: There is no way to deposit cash into your SoFi Money account. This could be limiting for people who earn income through cash payments.
- FDIC coverage isn’t immediate: Your deposits do not receive FDIC insurance until they arrive in accounts at partner banks, which could take up to two business days. This is a potential drawback worth considering.
- Restrictive transaction limits: The daily limitations on ATM withdrawals, bill pay, peer-to-peer payments and more might feel restrictive to those who consistently make large purchases or do not want to feel constrained when it comes to their spending.
- One account for all funds: Unlike a number of its competitors, SoFi Money does not offer separate accounts dedicated to spending and saving. For those who struggle with the self-control required to save money, this could create additional hurdles.
SoFi Money vs. other cash management accounts
SoFi Money is far from the first cash management account to crop up. Here’s how it stacks up to its competitors.
|Account||APY||Maximum FDIC insurance|
|SoFi Money||0.25% APY||Up to $1.5 million|
|Simple||Up to 0.50% APY on funds in Protected Goals account||Up to the legal limit|
|Aspiration Spend & Save||Up to 1.00% APY on funds in Save if you have an Aspiration Plus account||Up to $2 million|
|Betterment Checking and Cash Reserve||0.30% APY on funds in Cash Reserve||Up to $1 million|
SoFi Money vs. Simple
- Simple allows you to stash funds you want to save in the separate Protected Goals savings account.
- Simple does not waive the 1% Visa international fee, while SoFi Money does waive that fee for Mastercard.
- Simple offers a robust selection of budgeting tools built-in, while SoFi Money does not offer such features aside from a separate budgeting tool called SoFi Relay.
SoFi Money vs. Aspiration
- Aspiration has a dedicated, separate sub-account for funds you’d like to save, called Aspiration Save.
- Aspiration offers up to one ATM fee reimbursement per month, while SoFi Money does not.
- Aspiration offers socially conscious features, like tracking how sustainable your spending habits are and donating a portion of its earnings to charity.
SoFi Money vs. Betterment Checking and Cash Reserve
- Betterment Checking reimburses ATM fees, unlike SoFi Money.
- Betterment Everyday Cash Reserve’s partner banks offer FDIC insurance on deposits of up to $1 million, while SoFi Money’s partners offer FDIC insurance on deposits of up to $1.5 million.
- Betterment Everyday Cash Reserve has a feature that automatically moves money from a checking account to your Cash Reserve account to maximize interest earned.
Who is SoFi Money best for?
SoFi Money and its decent APY can be a more attractive option than a standard checking account at a brick-and-mortar bank, especially if you’ve been burned badly by bank fees in the past.
Its drawbacks, though, could ultimately be deal breakers for those who struggle with self-control and need a separate sub-account for savings, people who make large ATM withdrawals or those who want their funds to be FDIC insured right from the start. There are a number of cash management accounts to consider before deciding which one is the right fit for you.