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Financial Accounts to Consider
The three services below offer reasonable benefits in three different areas of finance: investing, credit, and bank accounts. Ideally, one should have at least one of each of these three. Read on to see why these three services might be the best for a young person with no previous financial history.
SoFi Checking and Savings
SoFi Invest started its life primarily as a micro-broker offering affordable investments from a mobile application, but quickly expanded its services to offer a variety of other financial tools, such as savings and checking accounts. Those who choose direct deposit of their paychecks into a SoFi account can receive their pay up to two days in advance, along with 1.25% APY. There are no account maintenance fees or minimum balances to carry, and SoFi offers free overdraft protection. The debit cards that come with the accounts can earn up to 15% cash back at certain stores, and using an ATM at an Allpoint machine is free or has low fees.
Those looking to begin building a credit history would do well to look at the Discover card. This credit card has been on the scene for decades now and boasts a good reputation with consumers. There is no annual fee for use of the card, 5% cash back for use at gas stations, and a cashback match plus low APR the first year. Cardholders can use their reward points on Amazon purchases without having to convert them to gift cards first, as other cards require. There are also special perks for travelers who can earn sky miles on Discover card purchases. Discover also offers student cards, with low APR and credit limits, to help young people begin building credit.
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Charles Schwab Investments
Charles Schwab is considered a good broker for beginning investors, as their financial services and educational materials meet the needs of investors with a variety of different goals. Investors can access their Schwab accounts via a mobile app, desktop application, or webpage. There are extensive research tools available, along with watch lists, price alerts, and level two access. Stock, ETF, and options trades are commission-free, and there is no account minimum.
Getting started early on your finances as a young adult is some of the best advice given to those just starting out in adulthood. Many long-term investors often lament how they wish they had gotten started investing earlier than they did, or how they wish they had opened lines of credit or bank accounts sooner. Many banks that require account minimums, sometimes upwards of $1,500 in checking alone, find themselves turning away young adults just out of school who barely have enough money to pay bills, much less carry a minimum in a bank account, which is what makes a service like SoFi so attractive. Schwab accounts with no commissions or account minimums also look good for young investors with little to get started. The Discover card offers some of the best cashback and points bonuses available on credit cards, encouraging healthy credit practices. Discover vs SoFi Checking and Savings articles show that both services offer useful services for the individual new to financial accounts. No doubt, all three of these services are useful to a new adult looking to build a healthy financial history.
1. Which of these services offer mobile applications?
All three services have mobile applications that allow for account management.
2. What is needed to open a new account with either SoFi, Discover, or Charles Schwab?
All three require proof of identity such as a state-issued ID, a social security number, recent paycheck stubs or W-2 tax documents, and a USA mailing address.
3. What are some things to look for when opening a new financial account?
Take note of interest rates, APRs, transaction fees, cashback rewards, loyalty programs, introductory interest rates that change after the first year, and bonuses.
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The content of this website is for informational purposes only and does not represent investment advice, or an offer or solicitation to buy or sell any security, investment, or product. Investors are encouraged to do their own due diligence, and, if necessary, consult professional advising before making any investment decisions. Investing involves a high degree of risk, and financial losses may occur.