SoFi made its name as a modern and more “fun” student loan refinancing company. Why were they fun? Not only did they offer low rates on student loan refinancing, but they also held events throughout the year and even offered career services.
They would hold education events that included networking events, happy hours, and other similar “experiences.” This helped them build one of the largest student loan refinance companies in the United States with over 800,000 members.
It was a different approach to student loans. Up until then, most loan providers competed on price (interest rate on the loan). And while SoFi competed on price too, they also offered these value-added bonuses that helped people fall in love with them.
They have since branched out to several other products including a cash management account called SoFi Money.
SoFi recently received regulatory approval to become a bank so they are able to offer bank accounts. We are in the midst of transitioning to the new language.
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Is SoFi Money a Bank?
Yes – they did not start off as a bank but they recently received regulatory approval to become one. When they started, they were a cash management account” and your funds are held at one of their partner banks. This is very similar to Betterment Cash Reserve and other similar products.
But they are now officially a bank with their own FDIC insurance offered through SoFi Bank.
SoFi Money Cash Management Account
There is just one product and it effectively acts as checking and savings account rolled into one. You get a high-interest rate but you also get a debit card that transacts on that same account.
There are no account fees and no account minimum. There is no monthly maintenance fee, no non-sufficient funds fee, and no overdraft fees. You can get personal checks for free as well as bill pay and transfers. If you use the debit card outside of the United States, they will not charge a foreign transaction fee either (they will pass on the 1% fee that Visa charges).
There are also no ATM fees – they will reimburse you any ATM fees as long you use an ATM with a Visa®, Plus®, or NYCE® logo.
Finally, you get a membership to SoFi which means you can attend those events I talked about in the opening section. While this isn’t an exclusive membership, it is a nice little perk you can take advantage of as long as you live near where they hold these events.
Vaults are like sub-accounts in your Sofi Money account. They’re not separate accounts but ways for you to think about various savings goals.
So you can set a Vault for an emergency fund, to save for your first house, or buy a new car. They all earn the same interest rate.
You can have up to 20 vaults at one time and there are no additional fees or minimums on vaults.
The only thing you can’t do is spend money from a Vault. You can only spend it from your main Sofi Money account. If you want to spend it, you have to transfer it from the Vault to the main account.
In the event your main account runs out of money, you can set up “reserve spending” so that money in your vault can be used to cover transactions in your main account. If you set this up, it’ll move money so transactions are approved. If you don’t, the transaction won’t be approved.
There are rare cases when they will override reserve spending to move money in the case of:
- Checks and ACHs deposited into your spending balance that are returned or reversed
- Debit card purchases that pre-authorize a lower amount than the final transaction amount (examples include gas station purchases and restaurant tips).
Finally, if you close a vault, that money goes directly into your main spending balance.
Account Opening Walkthrough
Opening an account takes just 7-8 minutes.
The first page is to register for Sofi – name, email, password.
Then, you pick whether to open an individual account or a joint account.
To keep things simple, I opened an individual account.
Next, you have to enter your permanent address. They use a tool that helps populate the address, similar to how Google Maps auto-populates as you type, so it’s super fast. Then you enter a phone number that they use for two-factor authentication.
Finally, you have to confirm it’s you with your date of birth and Social Security Number:
(there’s one more regulatory page asking questions like whether you’re an officer of a publicly-traded company, FINRA, etc.)
Then, boom – you’ll probably be confirmed!
Linking up an account is super easy too, just have to log in with your credentials.
It takes just a couple days for the transfer to complete, a typical amount of time for an ACH transfer.
And just like that, we’re off and running.
The Money Welcome Bonus of up to $250 is the referral bonus they offer if you open an account using an existing member’s referral link and receive qualifying direct deposits totaling at least $1,000. (here’s our list of all of SoFi’s bonuses)
SoFi limits you to a certain number of transactions to prevent fraud.
For peer to peer withdrawals, you are limited to $250 per day and $3,000 per month. Bill pay is limited to $10,000 per transaction.
Through ATM or Point of Sale Cash Withdrawal, you are limited to $610 (Ally Bank limits you to $1000 per day). Over-the-counter cash withdrawal is limited to $150 and your Point of Sale spend limit is $3,000. Finally, you’re limited to 12 point-of-sale transactions per day.
These are not onerous limits but there may be times when you will run into them.
Lastly, no wire transfers.
SoFi Money $300 Promotions
Want to get $300 to open an account? SoFi Money will give you $300 if you open your account and fund it with at least a hundred bucks and satisfy a few other conditions.
It’s just that simple. And once you’re done, you can refer your friends and give them $25 a pop too.