SoFi is a digital personal finance company with a large umbrella of products. Launched in 2011, there are now more than 1,000,000 members taking care of their financial health by refinancing student loans and mortgages, getting low-interest personal and home loans, investing and establishing IRAs.
Interestingly, they also host dinners and happy hours where you can rub elbows with other people that are members (also known as networking!)
SoFi offers financial services, including borrowing, investing and saving. Borrowers can take advantage of personal loans, home loans, private student loans and student loan refinancing. You can also save, spend and manage your cash with SoFi Money, and invest or automate investments with SoFi Invest.
All of these services are manageable online or with SoFi’s mobile app.
For the purpose of this review, we will specifically be looking at SoFi Invest and discussing whether or not this is a good option for venturing into the stock market.
SoFi Invest offers a lot of bells and whistles covering a lot of ground for a financial services platform. With a million members, you are not alone in trusting this brokerage platform. Right now, they specialize in stocks, ETFs and crypto. Fractional shares called "Stock Bits" lower the barriers to entry, and there are no commissions or minimums either.
$0 commission stock and ETF trading
Crypto trading available for a fee
Fractional shares called "Stock Bits"
High interest online savings account
No personalized guidance/robo-advisor
No tax loss harvesting
According to company press info, the SoFi goals are to guide people to:
Back in the day when investors lounged in leather chairs at country clubs smoking cigars, they were generally people with lots of money to spare.
Flash forward to current times, when you don’t need more than $1 to start buying. SoFi has no account minimums for you to start building a portfolio. They won’t ever take commissions, but they also aren’t set up to give personalized investing advice. It is all on you.
You can design your portfolio yourself or get an automated portfolio that's basically one-size-fits-all. Products include stocks, ETFs, and crypto currency.
Be sure to stay up to date with real-time investing news, curated content, and other relevant data by creating a personal watchlist and following the stocks that are calling your name.
Remember the value of holding onto your financial products over time to gain the advantage of compound interest. Compound interest is basically “interest on interest” and it’s how your money can make money over time.
This is why the earlier you start investing your money, the better. That way you can ride the highs and also the lows of the market over time towards your goals.
So, you’ve found a company whose mission you support with an outstanding record of exponential growth. Now you want a piece of that pie!
Then you find another company that’s on the fast track and you want to buy into that as well. Or heck, maybe you have 5 companies you like and can’t choose where to buy.
Fractional investing is a godsend for small or newbie investors. It basically allows you to buy a tiny percentage of the share rather than the whole stock itself. You can buy in at any amount you want, as low as $1. Also consider diversifying your investments by spreading your money across several stocks and ETFs. You will find a little goes a long way with fractional investing!
SoFi calls these micro-investments “Stock Bits” that let you buy only a portion of a stock from your selected companies.
You can spend more than $1 of course, but it’s good to know you can test drive your investment strategy without getting burned.
Share-based orders are executed immediately during market hours. However, Stock Bits orders are executed once a day on trading days.
The four SoFi ETFs are designed specifically for those ambitious people (like you) with longer-term goals for their investments.
Unlike other traditional ETFs, SoFi ETFs weigh companies by growth—not just market capitalization. All four ETFs are carefully diversified and auto-rebalanced, so that faster-growing companies are always in the mix. They are part of SoFi automated investing portfolios and are free of fees for at least the first year.
NOTE: Fractional investing shares are not avail through the 4 ETF portfolios.
There are no fees to open a cash management account to help you spend and save wisely. You earn rewards when you set up a direct deposit or recurring monthly savings plan of $500.
What’s more, you will earn 0.25% APY on all your cash, which is a big bang for your buck! There is also a SoFi master debit card you can use at more than 50,000 ATMs across the country with zero transaction fees.
This is a digital and automated experience that suggests possible next steps for you to consider for each of your student loans including medical or dental residency. However, because it is automated, suggestions won’t be designed for your personal financial scenario.
There are many reasons you may need a loan in a pinch. Maybe there’s a wedding in your future. Or you’ve found the perfect house and need a down payment. Or you have a home, but it needs a new front porch.
Another reason is to consolidate credit card debt could substantially lower how much you pay each month. Because most credit cards carry high interest rates, it’s nearly impossible to pay them off through monthly payments. SoFi can give you a low fixed-rate personal loan can be easier to manage—and can save you a lot of money.
Not thinking about retirement yet? You should be! You can start saving for retirement with SoFi’s active or automated Traditional, Roth, and SEP IRAs.
With their active IRAs, you’ll get access to a large array of investment options – always with free trades. Or choose an automated IRA, and SoFi will build a custom portfolio with a mix of stocks and bonds based on your risk tolerance.
SoFi Money is a cash management account that earns you high interest when you make deposits of at least $500 monthly. The interest rate is 0.25 percent APR. The earned interest is a great way to start socking away cash to buy those fractional shares!
If you've been shopping around for a new debit card, SoFi recently unveiled a new Mastercard. When you use it, you will earn exclusive cash back rewards like gift cards to your favorite local and nationwide stores, eateries and more.
As soon as you open your SoFi Money account, you won’t have to pay any ATM fees at more than 50,000 ATMs worldwide.
There are no account fees associated with SoFi Money.
While there isn’t a way for you to set up an appointment to discuss your future with a financial professional, there are articles on the SoFi site covering topics relevant to you, ranging from setting and sticking to a budget to how to track your spending to avoiding impulse buying late at night.
These unique SoFi offerings, called Experiences, are basically networking events held at various sites around the country. There, you can meet and greet other SoFi members face-to-face, talk to experts and even gain career advice.
SoFi pledges to NOT use the venue to sell you finance products. Oh yeah, because they are free, they sell out like hotcakes, so make your reservation ASAP and be prepared to sit on a waiting list.
SoFi offers a lot of bells and whistles covering a lot of ground for a financial services platform.
With a million members, you may experience a sense of being lost in the crowd. However, if you take advantage of SoFi Money and earn that high interest on your money, buy Stock Bits and use the Mastercard for spending rewards, you might find your happy place.