A low credit score may not keep you from getting all types of loans. In fact, some lenders provide loans specifically for people with bad credit. These can include personal loans for bad credit, “buy now, pay later” plans and cash advances from mobile apps.
Here are several types of loans for bad credit (a score below 630), why they’re worth considering and their potential risks.
Personal loans for bad credit
Some online lenders tailor personal loans to borrowers with low credit scores. Bad-credit personal loans can be $1,000 to $50,000, come as a lump sum and are repaid in equal installments over about one to five years.
Why they work: Reputable personal loan lenders cap annual percentage rates at 36%, which is the highest rate consumer advocates say affordable loans can have. They can be large enough to cover expensive home repairs and are typically funded within a few days of approval, making them a viable emergency financing option.
Possible risks: Having bad credit means you’ll qualify for an APR near the top of a lender’s range. Although other bad-credit borrowing options have higher rates, a 20% or 25% APR on a $5,000 loan is still expensive.
Family loans
It may be difficult to ask a friend or family member to lend you money, but it may also be the easiest and least expensive financing option. You can draw up a formal family loan agreement that includes what the funds will be used for and how they’ll be repaid.
Why they work: A friend or family member is unlikely to have a minimum credit score requirement or charge interest, as many other lenders do.
Possible risks: Mixing relationships and money can be dicey, and a loan gone awry may cause conflict.
Small bank and credit union loans
Some banks and credit unions offer small loans of a few thousand dollars or less to customers. Major national banks like U.S. Bank, Bank of America and Wells Fargo offer small-dollar loans, and some credit unions offer payday alternative loans or similar products.
These loans cost less in interest than most other types of bad-credit loans, have repayment terms of a few months, and lenders may look beyond your credit score to qualify you.
Why they work: Because small bank and credit union loans have low rates and long repayment terms, they’re more affordable than small-dollar high-interest loans offered by some online lenders.
Possible risks: Small bank loans and some payday alternative loans are only offered to existing customers. Though your credit score may not be the only — or even a major — factor a lender considers for these types of loans, it may carry some weight on the application.
Buy now, pay later loans
Buy now, pay later apps allow shoppers to split up a large purchase into smaller payments at checkout. The popular pay-in-four plans require a shopper to pay 25% of the cost upfront and cover the rest of the purchase in three biweekly installments. BNPL apps usually don’t do a hard credit check to approve customers.
Why they work: A BNPL plan can reduce the stress of a necessary, urgent expense like a mattress or laptop. Because the pay-in-four plans are interest-free, BNPL can be a no-cost financing option.
Possible risks: Most major retailers, including some grocery stores, offer this type of payment plan, which can make it easy to rely on them for everyday expenses. Frequent BNPL use can lead to overspending and cause people to lose track of upcoming payments. Some apps report payments to the credit bureaus, so missed payments can hurt your score.
Cash advance apps
A cash advance app is a mobile app that provides a small advance — often $500 or less — on your next paycheck. These apps use transaction history from a connected bank account to determine whether you qualify for an advance and how large it should be. There is no credit check, so your score isn’t a factor. The app takes repayment on your next payday.
Why they work: Loan apps can provide an advance within a few days after you request it, or instantly for a fee. Advances can be large enough to cover a modest vet bill or auto repair, or to bridge a brief income gap.
Possible risks: Cash advance app fees — including fast-funding fees and requested tips — coupled with short repayment terms make them difficult for some borrowers to repay without foregoing other necessary expenses or borrowing again shortly after.
Payday loans
Payday loans are small loans with high fees that are repaid quickly after you borrow. You can get a payday loan online or in person and the lender typically requires a post-dated check or access to your checking account to withdraw funds on your next payday.
Why they work: Payday loans are fast and easy to get. Lenders don’t check your credit or report payments to the credit bureaus.
Possible risks: These costly loans are difficult to repay in a short period, so borrowers often end up borrowing again to pay off the original loan or cover regular expenses. Because payday loan borrowers frequently end up in a debt cycle, these loans should be a last resort in a true emergency.
🤓Nerdy Tip
Car title loans and pawn loans are similar to payday loans. They frequently have triple-digit interest rates and short repayment terms, but they require a valuable item as collateral — your vehicle in the case of car title loans, or a personal item for pawn loans. Though these are both fast-cash options for bad-credit borrowers, they’re difficult to repay on time, and failure to pay them means losing the item you provided as collateral. NerdWallet recommends avoiding these loans if possible.
Nonborrowing options for bad credit
Payment plans: If you’re struggling to make a mortgage, utility or doctor bill payment, consider asking to set up a payment plan. Many creditors have hardship plans available for those experiencing financial difficulties, as do many utility companies and physicians’ offices. Request a payment plan before going into debt to cover bills.
Other ways to make money: If you have the luxury of time, consider ways to make quick cash. Options include selling clothes, delivering food, taking online surveys or listing a room on Airbnb.
Get help from the government: Some government programs can help with utility bills and groceries, child care and a down payment on a home.
Local financial assistance programs: A local charity, nonprofit or food bank may help cover some of your financial burden while you focus on a pressing expense. Search NerdWallet’s database of financial assistance programs for local organizations that offer relief.
Each of us has our own agenda in terms of what makes stashing our cash away worthwhile. For some of us, it’s the anticipation of doing something fun or buying something beautiful. For others, it’s all about using our money to secure some quality of life and peace of mind.
Regardless of what gets you saving, whether you’re stashing funds to buy a new computer, a used convertible, a house, or even retirement funds to ensure your future, you’ll be honing your saving skills and likely boosting your financial wellness as well.
Why Saving Is Important
The importance of saving cannot be overstated; it’s a very big part of successful money management. Consistently putting away cash can make a major difference over time, especially in your quality of life. By planning and prioritizing what expenses to fund, you’ll have the means to achieve your goals. It’s incredibly rewarding when you make a plan for your money and then realize it.
To jumpstart your savings, try one or more of these creative strategies.
• Budget first. The mere mention of the word budget can stress some people out, but a budget is simply a plan for how you will spend your money. Having a strategy in place can really help keep your spending and savings on track. There are a number of methods you can use to budget, including the good old cash envelopes system and the 50/30/20 rule, as well as a number of mobile apps. Research your options online, and find the one that works best for you.
• Automate savings. One of the easiest ways to ensure you’re saving toward your goal may be to automate your savings. This can take much of the stress out of saving. For instance, you could set up an automatic bank transfer from your checking to your savings account every payday.
• Save consistently. Once you open a bank account, over time, you have a great chance of meeting your goal. Maybe it’s only $5 or $25 a pop, but contributing to your savings account regularly is vital. Be consistent and trust the process.
• Save bonuses, tax returns, and other unexpected windfall amounts. These extras can give your savings account a tremendous boost.
• Match your own purchases. For every amount that you spend on a treat, transfer that same amount into savings.
• Save every $5 bill. By setting aside every $5 bill you encounter (as change from a purchase, from an ATM, etc.), you can save quite a bit in a year’s time.
• Use the 30-day rule to control impulse purchases. Write down that shiny new thing you want, whether it’s a pricey new mobile phone or a designer bag, and wait 30 days to see if you still want it. You may find that your urge to spend on it has passed. If so, you can put the money you save this way into savings to fund something that’s on your wishlist.
Recommended: How Much of Your Paycheck Should You Save?
25 Smart Items to Save Up for
Spending money according to your own personal preferences — whether it’s a vacation, a new car, or a comfortable home for your family — should be the driving force behind your saving goals. This is how to make saving fun: Make a list of cool things to save up for. Create a vision board if you prefer; the idea is to entice yourself to perhaps pass up some unnecessary spending (takeout meals, a multitude of streaming services, and so on) and achieve those things you really crave. Not sure what to start saving for? Here are 25 ideas to get you going.
1. Vacations
You may have heard that vacations are good for both your physical and mental health. Even the act of looking forward to a vacation can improve your happiness. Whether the vacation you crave is a week at a nearby beach, a long weekend with your college besties, or a jaunt through Europe, the prospect of travel can be great motivation to save money.
2. Brand New Electronics
Buying new electronics isn’t just a leisure pursuit. New electronics can help with your productivity and ability to earn an income (or a higher one). It may be worth it to you to save for and invest in tools, such as a new laptop or video equipment, that can make your life better.
3. Starting a Business
If starting a business and becoming your own boss is a dream of yours, savings can go a long way toward making it happen. In fact, 82% of small businesses fail because of cash flow problems. Start accumulating capital so you can hopefully avoid becoming part of that statistic.
4. Home Maintenance
Keeping your home in tiptop shape can not only make living in it more enjoyable and enhance its looks and curb appeal, it can be helpful when you decide to sell it. Maintenance can include such things as getting your furnace and air conditioner checked regularly and getting your carpets cleaned, to lawn care, landscaping, and painting.
5. Weddings
This is a popular motivation to save. Most people dreaming of their big day know that it doesn’t come cheap. The average cost of a wedding in 2024 was about $33,000, according to one survey. Saving for this expense means you can celebrate the special day with loved ones, just the way you want to, while minimizing money stress.
6. Pet care
Owning a pet is enjoyable and rewarding, but it can also be expensive: The annual costs of owning a dog can run anywhere from $1,000 to more than $5,000. Pet care costs include, food, treats, veterinary bills, toys, grooming, and supplies such as beds, collars and leashes. Saving up for these expenses can help you enjoy your furry family member without being stressed out about paying for the things they need.
7. Brand New Car
Most people need wheels to get around, but cars aren’t just about function. Maybe you are dreaming of a low-slung sports car or an SUV that’s ready to offroad. When you get the keys to a new car, you’ll likely know that your time and energy spent saving was worth it.
8. Down Payment on a Home
Saving for a home is a top priority for many and for good reason. Home prices will typically rise 18% to 20% in the next five years, based on historical averages, meaning the value of your home will rise and likely continue to do so. Aside from the potential financial benefits, owning your dream home is a major boost to your and your family’s quality of life.
💡 Quick Tip: Want a simple way to save more each month? Grow your personal savings by opening an online savings account. SoFi offers high-interest savings accounts with no account fees. Open your savings account today!
9. Clothing and Shoes
There’s something about fresh clothes and shoes that can give you a psychological boost. For a household, costs averaged $1,434 for apparel for the year. Saving a little toward making yourself look good is one of the fun things you can save up for. It could be a whole wardrobe upgrade or a special splurge piece, but clothes can be excellent saving motivation.
10. Hobbies
If there’s something you enjoy doing in your free time, be sure to save enough money to fully invest yourself in the activity. Do you want a new acoustic guitar or perhaps a pottery wheel? Save for it. You may even be able to monetize your hobby or start a business from it.
Get up to $300 when you bank with SoFi.
Open a SoFi Checking and Savings Account with direct deposit and get up to a $300 cash bonus. Plus, get up to 4.60% APY on your cash!
11. A Quality Mattress and Mattress Accessories
According to the Centers for Disease Control and Prevention (CDC), one out of three Americans don’t get enough sleep. Being deprived of sleep can have a major impact on how you feel and function. Which is all the more reason to save for the comfiest mattress you can find.
12. Exercise Equipment
The right exercise equipment can help you make your health a priority and work out regularly. It’s not cheap, though. Equipment can cost less than $20 for a kettlebell or thousands for a top-of-the-line rowing machine, exercise bike, or Pilates equipment.
13. Professional Lessons (Sports, Dancing, Cooking, etc.)
Whether you want to dance more smoothly or perfect your golf swing, saving toward developing those skills can bring a lot of joy and satisfaction.
14. College
So many people feel the thrill of pride and achievement when earning a college degree, and it can help fuel a career. But college is expensive. As of 2024, the average cost of college in the U.S. is more than $38,000 per student per year, according to the Education Data Initiative. Saving toward these expenses, whether for yourself or your dependents, can help them get the education they need and dampen the blow of the cost of education.
15. Quality Home Appliances
Maybe you’d like to remove that old eyesore of a dishwasher and replace it with a top-notch new one, or swap out your old washer/dryer for an eco-friendly new model. Or, say, a professional-grade stove is calling to you to live out your gourmet dreams. Once you get the appliance you were dreaming about, you’ll likely feel that saving for it was worthwhile.
16. Home Security
While it may not exactly be a cool thing to save up money for, a home security system can give you peace of mind. As a bonus, you may have fun doorbell footage to look at once you buy your system.
17. Jewelry
If you love shiny baubles, they can certainly be worth saving for. Maybe there’s a dream piece you’ve been pining for. With the cost of some custom jewelry ranging from about $500 to $10,000 or more, you’ll definitely want to have a plan to save for it.
18. Home Furniture
If you value updated and stylish furniture, you’ll want to put it on your list. New furniture can uplift the comfort, function, and look of your home. Not to mention, when (or if) you sell your home, it can possibly help your place fetch a higher sales price.
19. Events & Special Occasions (Concerts, Dinners, Sports Games, etc.)
Many of us look forward to making lifelong memories at special events, from a Taylor Swift concert to the Super Bowl to a local gala. These occasions can both entertain and help you feel connected to the people who accompany you. Indulging in tickets every now and then is an incredibly fun and cool thing to save up for.
20. Home, Car and Health Insurance
Putting money toward insurance premiums may not always be fun, but it may give you peace of mind. It helps you know that you’re covered in case of accidents, unexpected health problems, and natural disasters. Saving up to afford a policy is wise if you are, say, planning to buy a house or car or are prepping for a big live event, like marriage or becoming a parent.
21. Retirement
Saving for retirement is a critical part of your financial health. A Federal Reserve survey found that only 34% of adults felt their retirement savings were on track. If you want to give yourself a healthy cushion for some of the most vulnerable years of your life, you may want to add to your retirement savings. While it doesn’t give you a tangible payoff now, you may rest easier knowing you’re prepared for tomorrow.
22. Anniversaries
Have someone (or something) special you want to celebrate? Put aside some money to do it up right, especially if it’s a nice round number that’s coming up. It’s up to you whether the funds go towards a gift, a trip, or a special night out with friends and family.
23. Repairs and Remodels
Home improvements can make your home more comfortable and functional but they are likely a major expense. With the average remodel topping $41,600 in 2024, it will take quite a chunk of change to make it happen. Saving for this type of cost can help you turn your place into the showplace you know it can be.
24. Birthdays
Celebrating birthdays is a fantastic way to nurture the relationships in your life. Maybe it’s with a candlelit dinner or tickets to a show, but it can be a great excuse to save and then spend some cash.
25. Holidays
Creating holiday memories is important for many of us. Saving up for the holidays and seeing your vision for your family come to life can be incredibly rewarding. Americans spend around $866 each holiday season, according to data from the National Retail Federation; 71% of that goes toward gifts. Stashing some cash in advance can help alleviate stress during the most wonderful time of the year.
Banking With SoFi
Focusing on a wish-list item can give you the motivation and discipline to start saving. Of course, the savings goal will vary with each person. One person may want a trip to Bali, another may need a new car, and a third may be focused on getting a down payment together for a home.
Whatever the goal, opening a bank account and consistently depositing your cash into it to save for an important purchase can be a great way to help build your financial skills, improve your financial foundation, and elevate your quality of life.
Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.
Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.60% APY on SoFi Checking and Savings.
FAQ
How can I develop the mindset to save long-term?
To develop a mindset to save for the long term, be sure to start with a goal. Brainstorm some important, meaningful things to save up for. Then, automate regular transfers to your savings account. If you don’t see that money in your checking account, you likely won’t spend it.
Is saving money long-term hard?
Saving can be hard, and even a small amount stashed regularly can make a big difference in your financial wellness. The Federal Reserve Bank of St Louis reports that the personal savings rate in April 2024 was 3.6%. It may not be a huge amount, but it can be a good start.
How do I make saving money easier?
Saving money is easier when you have a plan in place. Automating money transfers to your savings account when your paycheck hits is one easy way to start saving towards a goal. You can also experiment with different budgeting methods to help “find” more money to put into your savings.
Photo credit: iStock/Borislav
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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.
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4.60% APY SoFi members with direct deposit activity can earn 4.60% 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.
As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.60% 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 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 4.60% 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 10/24/2023. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.
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Investment Risk: Diversification can help reduce some investment risk. It cannot guarantee profit, or fully protect in a down market.
Deciding between an online and a traditional bank? First, let it be known that no two people’s banking styles are exactly the same. For every person who loves popping into their local branch and chatting with their favorite teller, there’s someone else who avoids bank branches at all costs, preferring to seamlessly swipe their way through financial transactions on their mobile phone.
Traditional vs. online banks also have other important distinctions, including the dollars-and-cents bottom line. Their typical fees charged and interest rates paid differ as well.
So how can you decide which kind of financial institution best suits your needs? Read on to get the intel you need, including:
• The differences between traditional and online banking
• How online banking vs. traditional banking works
• The advantages of online banking
• How to open an online bank account
Differences Between Online and Traditional Banking
Online and traditional banking both typically offer reliable ways to manage your money, but they do differ considerably in several ways. First, a little lesson in what they are:
• Traditional banks are ones that have branches you can visit, have ATMs, and often have a website and app for conducting some business digitally. They tend to charge account fees and offer interest rates that may be lower than online banks.
• Online banks offer many (most, even) of the same services as traditional banks, but they don’t have a footprint in the physical world. You won’t be able to visit a branch or use their branded ATMs (though they may partner with an ATM network or refund your fees). The lack of branches usually allows them to charge lower or no fees and pay depositors a higher interest rate.
Now, here’s a closer look at some key points of differentiation:
Security
If you keep your money at a traditional bank and visit a branch, you likely feel reassured by the presence of security guards and perhaps a glimpse of a massive vault inside. You might wonder if online banking is as secure as a bricks-and-mortar bank. If you use a strong password and avoid conducting online banking with a public WiFi connection or on a public computer, you are following good advice for keeping your account safe. While there are no 100% guarantees, your money should be well protected.
What’s more, both online and traditional banks abide by the same federal regulations. This means that if your financial institution is insured by the Federal Deposit Insurance Corporation, you are covered in the event of a bank failure up to $250,000 per depositor, per account type. Want to be sure of that safety net? You can use the FDIC BankFind to make sure your online bank is FDIC-insured.
Bank Fees and Interest Rates
As briefly noted above, online banks typically save big on real estate and staffing costs and pass that along to their customers. Many charge no or low fees. Which may be a very big deal: According to the Consumer Financial Protection Bureau, Americans pay more than $15 billion a year on bank overdraft fees, which are usually $30 to $35 a pop.
Online banks also likely offer higher interest rates on saving accounts and may offer interest on checking, too. For instance, at press time, SoFi was offering 1.80% APY on savings, while Chase offered 0.01%. That’s quite a noticeable gap. So if you don’t use traditional banking services, you can probably save money and earn more interest with online banking.
24/7 Banking
A few years ago, online banks tended to have the advantage here, providing services around the clock. Traditional banks, which may only be open from 9 a.m. to 5 p.m. Monday through Friday, have been working hard to close the gap and offer services (from check deposits to money transfers) via their website or app at all hours.
Still, online banks may have the edge in terms of 24/7 support, since they have offered this kind of service from the get-go. Making mobile deposits or switching up your password at 2 a.m. is no problem for them, and if you hit a speed-bump, you can likely chat or phone your way to help.
ATMs
If you’re an account holder at a large traditional bank, you’ll probably have a good number of conveniently located ATMs that you can access without a fee. However, those who bank at a smaller, local or regional institution may have fewer options. They may have to make a special trip to get to their bank’s ATM or otherwise pay an out-of-network fee.
How about online banking and ATMs? Digital banks don’t have branches, so how can they have cash machines, you might wonder. The answer is: They don’t. Instead, they usually have work-arounds in this situation. Most online banks partner with a large cash-machine network that you can use for free for withdrawals or for depositing cash at an ATM. Or they may have an arrangement that refunds you for any bank fees you incur using an ATM. Online banks tend to work hard to level the playing field on this front.
Get up to $300 when you bank with SoFi.
Open a SoFi Checking and Savings Account with direct deposit and get up to a $300 cash bonus. Plus, get up to 4.60% APY on your cash!
How Online Banking Works
If you’ve been used to traditional banking, online banking may seem like a brave new world, and a somewhat intimidating one at that. In truth, however, online banking closely mirrors what happens at a bricks-and-mortar bank, minus the bricks-and-mortar and those free lollipops.
For example, you can open checking and savings accounts, get a debit card, sign up for automatic bill pay, transfer funds, and more. The one challenge can be withdrawing or depositing cash; there’s no teller service, but you may be able to manage cash at a linked ATM (as mentioned above). You may find that the pros of mobile banking and online transactions make up for this inconvenience.
If you typically go into a branch for certain services, such as wire transfers, you’ll likely find you can do them online with a digital bank. And the fact that you can do them on a website or app means the bank isn’t paying the overhead of having a bricks-and-mortar location. So you are probably earning more interest and avoid account management fees than if you kept your money at a traditional bank.
Recommended: How Many Bank Accounts Should I Have?
Advantages of Online Banking Over Traditional Banking
Here’s a side-by-side comparison of how online vs. traditional banking compares.
Feature
Online Banking
Traditional Banking
Interest rates
Typically have considerably higher interest rates since they can pass along their savings on overhead to the customer
Tend to have lower APYs (annual percentage yields) as they need to cover the costs of their branches and staffing
Bank fees
Usually offer no fees or lower fees than traditional banks
Often assess monthly account fees, minimum balance fees, overdraft charges, and more
ATMs
Probably lack branded ATMs but likely partner with a network for fee-free transactions
Typically have a network of their own ATMs, which may or may not be conveniently located
Customer Service
Usually offered 24/7 via chat or phone
Usually offered in person during business hours and by chat or phone 24/7
Security
High-level online security and fraud protection
High-level online security and fraud protection at large chains
How to Know if Online Banking Is Right for You
Whether you choose to bank online or with a traditional financial institution is a very personal decision. Here are a few of the most important signs that online banks will be a good fit:
• You prioritize high interest rates and low fees to help your money grow faster.
• You are comfortable accessing a partner network of ATMs vs. a bank’s own branded machines.
• You are satisfied with seeking customer service via chat or phone.
• You are confident managing your money without having a personal banker at your local branch.
• You are digitally savvy enough to conduct transactions online; you also know not to use public WiFi or computers for banking business or else you’ll risk bank account fraud.
Opening an Online Bank Account
With online banking, you don’t have to wait until Monday morning to open a new account. You can just log on from your couch on a Sunday afternoon to start a new account and otherwise manage your money.
Technology is allowing financial companies to change the entire banking experience and improve it for customers. One of these new ways is by opening an online bank account with SoFi. With our Checking and Savings, you’ll earn an amazing APY and pay no account fees.
Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.60% APY on SoFi Checking and Savings.
FAQ
How does online banking work?
Online banking allows you to manage your money without going into a bricks-and-mortar branch. Using the bank’s website and/or app, you can spend, save, transfer funds, and conduct other business.
What are the advantages of online banking over traditional banking?
Online banking can offer several advantages: Some people prefer using a website or app vs. going into a bank branch as often happens with traditional banking. What’s more, online banking usually offers lower fees (or none whatsoever) and higher interest rates than bricks-and-mortar banks.
What is a disadvantage of online banking?
Online banking doesn’t offer the opportunity to build a personal relationship with your banking team. Also, depositing cash can be a challenge.
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.
SoFi members with direct deposit activity can earn 4.60% 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.
As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.60% 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 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 4.60% 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 10/24/2023. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.
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.
External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
They may seem old-fashioned compared to digital payment methods, but checks are still very much a part of many people’s financial lives. In fact, there are a whopping 14.5 billion checks circulating every year in the U.S.
If you receive checks, you have options in terms of how to deposit them, including in person at a bank, at an ATM, or via a mobile app. Here’s what you need to know about the different methods for depositing a check and the easiest way to get the job done.
How To Deposit a Check in 5 Steps
Typically, depositing a check involves these five simple steps (unless of course you automate the process with direct deposit). Follow these guidelines to successfully get a check into your bank account where you can then use it.
1. Select Your Preferred Method
Your financial institution may have different ways you can deposit a check, including in person, at an ATM, or through their mobile app. The method you choose will affect the specifics of what you need to do to deposit your check. If you choose to go in person, double check the bank’s open hours. For mobile apps, you will need to download the app. Most ATMs will let you deposit a check as long as the machine is in your bank’s network.
2. Gather What You Need
Aside from your paper check, the exact type of documentation you’ll need will depend on how you go about depositing a check:
• In person: This procedure can vary depending on your financial institution. At some banks, you may be able to use your debit card at a teller’s window to deposit a check, no deposit slip required.
In other cases, you may need to get and fill out a deposit slip. This piece of paper outlines how much you want to deposit and to which account. Information you will need to fill out includes your name, account number, and deposit amount. In many cases, banks may also need to see a government-issued photo ID when you make the deposit.
• Mobile app: You will need to log into your bank’s mobile app on your device. Be prepared to take a photo of the front and back of the check. Typically taking a photo against a dark background helps the app take a clearer photo.
• ATM: When heading to the ATM, you’ll need your debit card. Check to see if the ATM accepts check deposits for your financial institution. Also, a few ATMs still require that checks be put into envelopes (provided at the machine) for deposit.
3. Endorse Your Check
Endorsing your check means to sign your name on the back of it in the appropriate place (it typically says “Endorse here” or provides a line to sign on). You can write “for deposit only” on the back when making a deposit so that the money can only go to your account.
Some checks also have a box you can tick if you’re making a mobile deposit. Or your bank may request that mobile deposit checks are endorsed with your name and a phrase like, “for electronic deposit at [bank]” or “for mobile deposit at [bank].”
4. Confirm Deposit Amount
If you deposit a check in person, you may need to indicate the amount on the deposit slip. If you’re using your bank’s mobile app, you may have to enter in the payment amount of your check. Same goes if you deposit it at an ATM.
Before confirming your deposit, make sure you have indicated the correct information. Being even one digit off from your account number, for example, could result in delays to access the funds you’ve deposited.
5. Wait for Confirmation
Once you’ve successfully deposited a check in person, the bank teller may give you a confirmation slip reflecting the transaction or you can request one. You can also check your bank’s website or app to see the pending deposit.
With mobile deposits, you may receive a pop-up confirmation message or an email acknowledging receipt of the check. Some banks may show the pending transaction in the app right away.
At an ATM, you usually receive a receipt of the transaction. Hang onto this piece of paper until you confirm that the deposit has indeed been posted to your account.
In terms of how long it will take for the check to deposit and be cleared, that will vary depending on such factors as how you deposited it, the amount, and the bank it’s drawn on. It could take between one and several days.
Get up to $300 when you bank with SoFi.
Open a SoFi Checking and Savings Account with direct deposit and get up to a $300 cash bonus. Plus, get up to 4.60% APY on your cash!
💡 Quick Tip: Don’t think too hard about your money. Automate your budgeting, saving, and spending with SoFi’s seamless and secure mobile banking app.
Ways of Depositing a Check
When it comes to depositing a check, the method you choose will depend on what your bank offers and what feels most convenient for you.
In Person
Though not always convenient, you can take your check to your local bank and deposit it into your account. (Worth noting: Some banks may allow you to cash checks without an account there, but you may have to pay a fee.)
Mobile App
Many banks and credit unions offer mobile apps for their customers. A popular feature is mobile check deposit, which allows you to snap a photo of the check with your device and deposit it remotely…no trip to a bank or ATM required.
ATM
Traditional and some online-only banks offer the convenience of depositing a check at an ATM, whether to your checking or savings account. Read your account’s fine print or contact customer service to see if this needs to be at an ATM in your bank’s network.
💡 Quick Tip: Want a new checking account that offers more access to your money? With 55,000+ ATMs in the Allpoint network, you can get cash when and where you choose.
Keeping Safety in Mind When Depositing Checks
No matter which method you choose, it’s important to be safe when depositing checks. Keep these safety tips in mind:
• One key step is to make sure a check is valid and comes from a legitimate source. If you’re not expecting a payment and receive a check in the mail, you’re not wrong to be suspicious. It could be part of a scam. The same holds true for checks you were expecting but that arrive for a higher amount of money than you anticipated.
• If you want to verify a check, or see if it’s legitimate, hold the check up to the light to see if there are any watermarks (which are a good thing) or if there’s any evidence that it’s been tampered with (a bad thing). In addition, get a feel for the paper the check is printed on; if it feels thin, like the paper you put in a printer, it may be fraudulent.
• Checks also have a safety feature called an MICR (magnetic ink character recognition) line. Located at the bottom of the check, this usually shows details like the issuing bank’s routing number. The ink should look flat and dull. If it looks shiny when you hold it under the light, it may be a fake check.
Think you have a fake check in hand? Talk to your bank about how to proceed, and you may want to report it to the Federal Trade Commission (FTC) or the Better Business Bureau (BBB), which has a Scam Tracker department.
One last suggestion: You might also keep in mind that mobile deposit and even direct deposit (bypassing checks altogether) are often good options in terms of safety. These techniques can be preferable to looking for a bank branch or ATM that can accept your check, especially at night or in bad weather.
Recommended: Cashier’s Check vs Certified Check
The Takeaway
Depositing a check typically involves five simple steps: Select a deposit method, gather materials, endorse the check, confirm its amount, and be sure that it’s hit your account.
While checks are a common, time-honored way to receive funds, you have plenty of options today to send and receive money. Check out what different banks offer (and how much services cost) to make sure you have the right banking partner for you.
Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.
Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.60% APY on SoFi Checking and Savings.
FAQ
How do you deposit a check into your account?
You can deposit a check in your account either in person, through your bank’s mobile app, or at an ATM. Once you decide on a method, you gather what you need, endorse the check, confirm its amount, and receive acknowledgement that it’s in your account.
How do you deposit a check at an ATM?
You can deposit a check at an ATM by going to a machine that will accept your deposit — your bank may stipulate which ones are acceptable. Insert your debit card and enter the correct PIN number, then follow the prompts to deposit your check.
How do you deposit a check without going to the bank?
You can deposit a check without going to the bank by doing it through your bank’s mobile app or at an ATM.
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.
SoFi members with direct deposit activity can earn 4.60% 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.
As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.60% 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 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 4.60% 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 10/24/2023. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.
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.
*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.
Want to know what the best businesses that run themselves are? Have you ever dreamed of having a business that runs by itself? Whether you want extra income or a full-time job, these businesses make money without needing you all the time. Having a business that runs itself means more time for you to do…
Want to know what the best businesses that run themselves are?
Have you ever dreamed of having a business that runs by itself? Whether you want extra income or a full-time job, these businesses make money without needing you all the time.
Having a business that runs itself means more time for you to do what you love. This could be more family time, traveling, pursuing passions, or starting another venture. These kinds of businesses are perfect for making your dreams a reality.
Now, that doesn’t mean that all of the businesses below will require zero hours of work from you – they will need varying amounts of time dedicated to them. Maybe some time in the beginning to get it started, some time to maintain it, or even hiring an employee to keep it going or check in occasionally.
Recommended reading: 18 Passive Income Ideas To Earn $1,000+ Each Month
Businesses That Run Themselves
Below are the best businesses that run themselves.
1. Self-service laundromat
A laundromat business can be a great business idea if you want something that mostly runs itself.
With the right setup, you might only need to check in occasionally. Laundromats can give you a steady source of income because people always need clean clothes.
The day-to-day operations of a laundromat include opening the business up in the morning, maintaining machines (the washers and dryers) and keeping the business clean, stocking detergents, and having someone handle the finances. The average self-service laundromat has 2 employees or less, so this is a business where you can outsource that job even.
Running a laundromat can be rewarding and mostly hands-off, making it a popular choice among business owners. If you’re looking for a steady income with minimal daily effort, this could be the option for you.
Recommended reading: Are Laundromats Profitable? How Much Do Laundromats Make?
2. Sell printables
Digital products, such as printables, can be a great way to have a business that runs itself.
Making printables on Etsy can be a great idea because you just need to create one digital file per product, which you can then sell an unlimited number of times. This is what makes it a great passive income opportunity, plus, you can make printables without anything other than just your laptop/computer and internet connection.
Printables are digital products that customers can download and print themselves at home. Examples of printables include:
Grocery shopping checklists
Gift tags
Candy bar wrappers
Printable quotes for wall art
Patterns
Planners
Coloring sheets
Stickers
These items are designed to be easily printed from a computer or other devices, being convenient for buyers who want to customize and use them right away.
Recommended reading: How I Make Money Selling Printables On Etsy
Do you want to make money selling printables online? This free training will give you great ideas on what you can sell, how to get started, the costs, and how to make sales.
3. Blogging
Blogging can be a business that runs itself mostly, but it’s not passive, especially at the beginning. It requires a lot of hard work and can take up most of your time when you’re starting out. Over the years, I’ve automated much of my blog so that it runs with about 10 hours of maintenance from me each week.
Starting a successful blog is challenging – it’s not something everyone can easily do!
That said, learning how to start a blog has been one of the best decisions I’ve made. It’s a great way to earn semi-passive income and extra money.
I think it’s one of the best businesses that run themselves, and it’s something that I have been doing for years. I can take weeks off at a time and still earn a great income during that time.
Blogging can generate passive income because you can create a blog post (high-quality content is key) and continue to earn money from it for years. This income can come from affiliate marketing or display advertising. Unlike traditional jobs where you have to work daily to earn money, a blog allows you to make money around the clock – even while you sleep – thanks to the work you’ve already done in the past.
I have a free training that you can take – How To Start A Blog FREE Course. Want to see how I built a $5,000,000 blog? In this free course, I show you how to create a blog, from the technical side to earning your first income and attracting readers.
4. Affiliate marketing
Affiliate marketing is a great way to make money with a business that mostly runs itself and can make money in your sleep.
Among these businesses that practically run themselves, this one is my favorite. I’ve earned more than $2,000,000 through affiliate marketing over the years, and much of it is semi-passive. I can earn money while I’m on vacation, without internet, while I’m sleeping, and more.
Affiliate marketing is when you earn money by placing a special link on your website or social media. When people buy something through your link, you get a commission. For example, if you link to a book on Amazon (after joining the Amazon affiliate program) from your website and someone buys it through your link, you earn a commission. Companies like Amazon value good affiliates because they help promote their products and services.
You earn a commission by promoting other companies’ products or services. When someone buys through your link, you get paid.
Now, this doesn’t mean that affiliate marketing completely runs itself. You will need to write the content that draws readers in and find ways to get page views. But, once you get things started, you can earn money without always actively working for it.
Recommended reading: Affiliate Marketing Tips For Beginners – Free eBook
5. Rental real estate and rental properties
Being a property owner and managing properties can be a great way to run a business that makes money on its own.
One way to earn extra money is by listing your property on Airbnb or another short-term rental platform. You can rent out your entire house, apartment, or just a room to travelers looking for short stays.
Another way to earn money is through long-term rentals. Long-term rentals involve renting out a property for an extended period, typically six months to a year or more. For example, you might rent out an apartment or house to a family who will live there full-time.
One advantage of long-term rentals is the stable and consistent income they provide. By leasing your property to tenants for a longer duration, you establish a steady stream of rental payments. This reliability can be particularly appealing for those seeking a reliable source of passive income. Plus, managing a long-term rental is usually less demanding than a short-term rental since you don’t need to clean the property frequently or find new renters regularly.
Whether you rent out your property short-term or long-term, you can lessen your involvement by hiring a property manager to do any of the day-to-day work that may be needed. This can make your rental property business more of a hands-off business model.
Recommended reading: 23 Best Real Estate Side Hustles To Make Extra Money
6. Online courses
Creating and selling online courses can be a great way to earn passive income. Once you develop the content and put it on a platform like Teachable, it mostly takes care of itself.
With an online course, you share what you know with others. Maybe you’re good at math, photography, or playing guitar. You can turn those skills into a course.
Creating online courses is a smart way to take what you know and turn it into a business that runs almost by itself. It can be fun too, and you can help a lot of people at once.
I created Making Sense of Affiliate Marketing, my first online course, several years ago and have earned over $2,000,000 from it.
Creating a course is not the easiest way to start a business that runs itself, but it can be a great way to earn an income around the clock. Most of the work is done in the very beginning, and then there is some maintenance along the way to keep the course updated, help students, and so on.
Recommended reading: How I’ve Made Over $1,000,000 From My First Course Without a Big Launch.
7. Storage facility
Running a storage facility is a great way to have a business that can largely manage itself. Plus, this can be a steady income stream, and many storage facilities have long waiting lists and are in high demand.
Self-storage facilities are places where people store their belongings, like boxes of their keepsakes, vehicles, RVs, and more, in storage units or in a big lot.
Owning a self-storage business can be a way to earn money with low expenses. These businesses usually only need a couple of employees.
Often, when I visit a self-storage lot, it’s just the owner or one employee working, and there are very few customers around. Sometimes, no one is working and I just use a code to go in and out.
Another idea similar to this is to rent out your storage space on Neighbor.
Neighbor.com is a platform where you can rent out your space to people who need storage for their belongings such as boxes, furniture, and even cars. You can list spaces like your driveway, garage, closet, and more on Neighbor.com. It’s similar to Airbnb but for storage – no one stays overnight, just their belongings! Depending on demand in your area and the type of storage space you have, you can earn between $100 to $400 or more each month.
Recommended reading: How To Invest In Self-Storage For Beginners
8. Stock photography
Stock photography is a great way to start a business that will eventually run itself. With this type of business, you take photos and upload them to stock photo websites. When someone buys your photo, you get paid.
Once your photos are online, they can sell again and again too.
Stock photos have many different purposes for websites, companies, blogs, and more. Businesses use stock photos because they may not have the resources to photograph everything they need. Instead, they can use stock photos to improve the visual appeal of their content, website, or business.
I personally use stock photos in my blog posts, as do many others. All the photos in this article are stock photos, actually.
There are several well-known stock photo websites such as Shutterstock, iStock by Getty Images, Adobe Stock, and Dreamstime.
To sell photos on these sites, you’ll need to create a contributor account and upload your images following the site’s rules. Each time someone downloads your photos, you earn a commission.
On stock photo websites, having high-quality photos is very important, but having a larger portfolio also matters. The more pictures you have in your stock photo collection, the more potential income you can generate.
Recommended reading: 18 Ways To Get Paid To Take Pictures
9. Car washes
Running a car wash business can be a great way to earn money with minimal effort. Automatic and self-serve car washes are especially popular because they require less work to manage day-to-day.
A self-service car wash is a place where customers pay to use equipment to wash their own cars.
An automatic car wash is a place where customers drive through a tunnel where machines do all the cleaning.
Starting a car wash can be cost-effective over time. The equipment can handle many customers with little human help. You just need to check the machines and refill supplies.
10. Write ebooks
Creating ebooks can be a great way to generate passive income streams. Once you write and publish an ebook, it can keep earning you money with very little effort.
Writing a book can provide passive income because you only need to write it once, yet you can continue to earn money from it for years. While you may need to do some promotion to keep readers engaged, the writing itself is a one-time effort. This makes it possible for the income to be passive over time.
Plus, you can start by self-publishing an ebook and selling it directly on Amazon or on your own website.
11. Dropshipping
Dropshipping is a popular business model that lets you sell products without keeping any inventory. You simply partner with a supplier who ships the items directly to your customers.
Dropshipping can be a great choice because there are low start-up costs as you don’t need to buy stock or rent a warehouse. This keeps costs down at the beginning.
Plus, there’s a lot of flexibility. You can run your dropshipping business from anywhere with an internet connection. This makes it perfect for those who like to travel or work from home.
There are many different things you can sell in a dropshipping business, such as T-shirts (you could even have a print-on-demand business), home decor, mugs, kitchen tools, pet supplies, and baby items.
12. Run a membership website
Membership websites are a great way to run a business that can almost take care of itself. These are websites where people pay regularly to access exclusive content or services.
Now, these will require work and some maintenance. But, you can earn recurring income 24/7, without actively needing to work.
Plus, as more people join, your income grows without adding lots more work.
Some examples of membership sites can include running a Patreon for your YouTube channel, a stock photo membership site, a paid forum, and an online school.
13. ATM business
If you want a low-maintenance business idea that almost runs itself, you may want to look into ATMs.
ATMs can be great because they don’t need much daily work. Once set up, you just need to check them regularly and refill cash.
To start, you’ll need one or more ATM machines (these typically cost around $2,000 to $10,000), you’ll need to find locations (such as convenience stores, malls, gas stations, etc.), set up the ATM (connect it to a network), and monitor and maintain it.
You would earn money through the ATM transaction fees that people are charged when they withdraw money.
Using ATMs can be a good way to make extra money without a lot of effort. They need some work at first but can become a reliable source of income.
14. Parking lots
Parking lots can be great businesses that mostly run themselves.
People always need places to park, such as in cities, near popular venues, at airports, and at shopping centers. If you can find a good location, your parking lot can bring in steady income without much daily work from you.
To get started, all you need is a plot of land. You can set up pay stations to handle money collection. Some lots even use apps for payments, making the process easier for everyone.
And, with the right setup, you can keep things running smoothly with just occasional cleaning and repairs.
15. App development
If you have technical skills, developing and selling an app can be a way to start a business that operates autonomously.
Creating your own app, whether it’s a useful tool, a fun game, or something else, can be profitable.
Although it requires initial effort and investment, once your app is available in app stores, it can generate revenue around the clock through in-app purchases or with the initial download.
You can create mobile apps like a budget tracker, meal planner, fitness tracker, meditation guide, travel planner, and others that cater to specific needs or interests.
16. Billboards
A billboard business is a great way to make passive income. Once set up, it needs little maintenance. You can rent the advertising space to companies for their ads.
Now, building new billboards isn’t allowed everywhere, but in many places, you can still add them onto your own land or buy one that already exists. You’ll want to check local laws to know more before you begin.
Billboards require minimal upkeep, which makes it a great business that runs itself. Regular checks and occasional repairs are needed. Digital billboards need more maintenance, but they can display multiple ads and increase income.
17. Sell on Amazon
Amazon FBA (Fulfillment by Amazon) allows sellers to store their products in Amazon’s warehouses. Amazon takes care of shipping to customers, handling returns, and managing customer service for the seller. This setup frees sellers from storing inventory or dealing with shipping logistics.
While you still need to find products to sell, Amazon FBA makes it possible for anyone, even without experience, to earn money selling items like household goods, toys, books, electronics, and more through their platform.
Recommended reading: How To Work From Home Selling On Amazon FBA
18. Vending machine business
A vending machine business can be a great way to earn passive income. With some initial investment and a bit of planning, you can start making money with minimal effort. Vending machines typically need minimal upkeep and the hours are low.
You can start with as little as $1,500 to $3,000, and even buy used or refurbished vending machines to save money.
Vending machines can be placed in high-traffic areas (with permission and an agreement, of course), such as schools, offices, gyms, hospitals, and more. You may need to pay 5% to 25% of your earnings to use their space.
Vending machines run on their own for the most part. You will have to refill the machines regularly and make any needed repairs.
A vending machine business can be a smart way to generate passive income while requiring little hands-on work. With the right location and products, you can see steady profits.
Recommended reading: How To Start A Vending Machine Business – How I Make $7,000 Monthly
Frequently Asked Questions
If you are thinking about having a self-running business, here are some common questions and helpful answers that might guide you in the right direction.
How can I start a business that doesn’t need me to be there all the time?
To start a business that doesn’t need you to be there all the time, I recommend finding a business model that can be easily automated. Examples include online stores using dropshipping or print-on-demand services. These models let you automate order processing and inventory management, reducing your need to be involved in daily operations. Other businesses include running a laundromat, selling printables on Etsy, blogging, rental real estate, and stock photography.
What are some top businesses known for making money while the owner sleeps?
The best businesses known for making money while the owner sleeps include rental real estate, blogging, stock photography, dropshipping, ATMs, developing an app, and selling an online course. These businesses have systems in place that handle most tasks automatically, allowing you to earn money with minimal hands-on management.
How to have a business that runs itself?
To have a business that runs itself, you need to try something like vending machines, ATMs, blogging, stock photography, dropshipping, and more. Then, you can either automate as much as you can, or outsource the hours where something needs to be done (such as refilling the vending machine).
What is the easiest business to start and run?
Among the easiest businesses to start are online stores using dropshipping, vending machines, and digital products like printables. These business ventures require low upfront investment and minimal ongoing management, making them accessible for beginners.
How do you find a self running business for sale?
To find a self-running business for sale, you can look for listings on business-for-sale websites or contact business brokers. Many websites list businesses for sale, such as BizBuySell and LoopNet. Always research and vet any business thoroughly before buying.
Businesses That Run Themselves – Summary
I hope you enjoyed this article on the best businesses that run themselves.
Self-sustaining business examples include online businesses like blogging and affiliate marketing, where you create content or promote products and enjoy passive income.
Even offline options like laundromats and car washes can be mostly self-sustaining, needing only occasional maintenance. Another good example is a vending machine business. You just put your machines in good spots and let them do the work.
Managing a rental business can be another way to have a business plan that doesn’t require a lot of active hours from you.
For me, I have a business that I work a low amount of hours and can run itself for the most part. I have automated a lot to make this possible, as well as have worked a lot of hours in the beginning. I love having a business that can run itself, as it means that I have more time for other things in life.
What do you think are the best businesses that run themselves?
Online savings accounts function similarly to traditional savings accounts, except you will manage your account entirely online or by app. Not only can these savings accounts be one-click convenient, they may offer you a healthier interest rate than accounts held at a brick-and-mortar bank.
If you’re trying to decide whether an online savings account or traditional savings account would suit you best, here are the details you need.
What Is an Online Savings Account?
An online savings account functions similarly to one offered by a traditional bank, except you manage your banking needs digitally. With an online savings account, you won’t have the option of walking into a bank when you need support, but you will be able to quickly click your way ahead and complete most transactions.
As a refresher course, savings accounts are a type of bank account designed to help you save. They keep your savings separate from the money you spend on essentials like rent and groceries, which is usually held in a checking vs. savings account.
Since the principle is that your money will sit and grow in these accounts, rather than flow in and out constantly, banks pay you interest on these funds. They get to use your money, and they give you interest in return for that privilege. As your cash grows in the account, you can achieve different goals, such as building up an emergency fund, saving for a vacation, or getting a down payment together for a house.
💡 Quick Tip: An online bank account with SoFi can help your money earn more — up to 4.60% APY, with no minimum balance required.
How Does an Online Savings Account Work?
You start an online savings account with an opening deposit, and then you’re ready to start saving. With an online savings account, you can manage your savings from anywhere in the world at any time of day. While there are plenty of banks and credit unions that have online account management services, purely online savings accounts often come with unique perks. For example, online banks usually don’t have a minimum balance requirement like traditional banks do. They often pay a higher interest rate, too.
You can transfer funds in and out as needed, as with any savings account. Typically, savings accounts had only allowed six or fewer transfers per month. Initiate more than that, and you might have to pay a fee. However, many banks have stopped following this guideline in recent years. Check with your bank to know the details.
It’s also worth mentioning that with an online account, you won’t be able to deposit or withdraw cash into your account by strolling into a branch. There aren’t physical banking locations to visit. You’ll need to transfer funds in and out electronically, or you may be able to use ATMs. There’s a silver lining, though. In exchange for not having to pay for the overhead that comes with running an in-person bank, online banks often offer lower fees and higher interest rates.
Depositing Funds Into an Online Savings Account
As mentioned above, it’s not possible to deposit cash into an online savings account by visiting a branch. Instead, you can deposit money in the following ways:
• Transfer money from a linked account into your online savings account. (If you’re really committed to saving, you may want to automate recurring transfers).
• Use a check; this deposit can be done by mobile deposit or by mail.
• Complete a wire transfer into your online savings account.
• Set up direct deposit of funds (say, your paycheck or other benefits) to go into the account.
Withdrawing Money From an Online Savings Account
Next, consider withdrawing and spending money from a savings account. When you have an online savings account, here are your options:
• Transfer funds into another account (say, one held at a traditional bank), and then take out cash in person.
• Use an ATM. Some online banks allow you to link your savings to a debit card, which makes this possible.
• Initiate a wire transfer.
• Put in a check request.
• Digitally send money to other people (say, by a P2P transfer) so you don’t need to take out cash.
Cash Deposits
Unfortunately, online banks don’t usually enable you to deposit cash, as there are no physical banking locations available. See above for some of the other ways you can move your funds around so your cash gets where you want it to go.
Earn up to 4.60% APY with a high-yield savings account from SoFi.
Open a SoFi Checking and Savings account and earn up to 4.60% APY – with no minimum balance and no account fees.
Benefits of Using an Online Savings Account
Here are some of the key benefits you may enjoy with an online savings account.
• Higher interest rates and lower fees. This means your savings can likely grow faster. These higher interest rates are possible because the financial institution doesn’t have to pay for expensive brick-and-mortar banking locations.
• Manage accounts anywhere, anytime. It’s possible to do all of your basic savings account management whenever and wherever you like. The only requirement: a good, secure wifi connection.
• Helpful mobile banking apps. Plenty of traditional banks have mobile apps, but online banks tend to have high-tech apps with better features.
• More accessible customer service. You are likely to be able to get all of the banking support you need from the comfort of your own home or on the go. Online banks were built to be responsive in this way.
Disadvantages of Using an Online Savings Account
On the flip side, there are some disadvantages when you only bank online. Here are some of the cons of using an online savings account.
• No face-to-face interaction. With online savings accounts, you can’t go into a physical banking location, ask questions, or sit down with a bank representative. For those who like face-to-face interaction, this can be a disadvantage.
• Can lose account access. When a savings account is entirely online, you may lose account access in the rare event of the bank’s system going down.
• ATM access can be limited. Some online banks don’t have their own ATMs. They may try to provide greater access with some independent ATM networks or by reimbursing customers for ATM fees incurred when using out-of-network ATMs.
• Fewer financial services. Some online banks offer more limited product selections than larger traditional banks. If you’re looking to manage your savings account, loans, and other financial products in one place, you may find that an online savings account doesn’t meet your needs.
Pros of Online Savings Accounts
Cons of Online Savings Accounts
• Higher interest rates and lower fees
• Ability to manage accounts anywhere, anytime
• Helpful mobile banking apps
• More accessible customer service
• No face-to-face interaction
• Can lose account access
• ATM access is limited
• Fewer financial services
Opening an Online Savings Account
If you decide you want to open an online savings account, here are the steps you will likely take.
1. Fill out the application. This process typically happens entirely online. Generally, you will be expected to provide such information as your name, proof of address, Social Security number, and government-issued photo ID (say, a driver’s license or a passport).
2. Choose an account type. There may be an option to choose between different savings account types, such as an individual account or a joint account that you can share with a family member.
3. Designate beneficiaries. Next, you will need to choose a beneficiary to whom the savings account would go if you were to die.
4. Deposit funds. Some online banks won’t require a minimum initial deposit or will only request $1. Whatever the amount may be, you will need to make that minimum deposit. (There’s no typical online savings account minimum balance to maintain, by the way. Check with banks to understand their particular guidelines.)
5. Create login information. All online savings accounts will need a username and password. It’s important to make the password a secure one that includes one or more capital letters, numerals, and symbols. Also, it bears repeating: Don’t reuse passwords. Unique passwords will help keep you secure from hackers. This is a big issue if you are wondering whether or not online savings accounts are safe.
💡 Quick Tip: If you’re saving for a short-term goal — whether it’s a vacation, a wedding, or the down payment on a house — consider opening a high-yield savings account. The higher APY that you’ll earn will help your money grow faster, but the funds stay liquid, so they are easy to access when you reach your goal.
Online Savings vs Traditional Savings: Which Is Best for You?
There are both advantages and disadvantages to consider when choosing between an online savings account and a traditional savings account. Being aware of the unique advantages and disadvantages of each can make it easier to find the right fit.
Online Savings
Traditional Savings
• Better rates and fees
• Stronger digital tools and features
• Limited product offerings
• Minimal ATM access
• Hard to withdraw cash
• No face-to-face customer support
• In-person banking locations
• More ATM access
• Broader range of products
• Fewer online resources
• Lower interest rates and higher fees
The Takeaway
Online savings accounts vs. traditional ones can be more convenient, have more digital features, and offer lower fees and better interest rates. Traditional banks, however, can make it easier to withdraw and deposit funds, and they can be the right choice for people who like face-to-face interaction when it comes to their finances. Figuring out the right fit can depend on your money style and goals.
Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.
Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.60% APY on SoFi Checking and Savings.
FAQ
How do I use an online savings account?
With access to a computer or a smartphone, you can access your online savings accounts from anywhere at any time simply by logging in.
What is the typical minimum balance for an online savings account?
That depends: Some online savings accounts have minimum balance requirements while others don’t. Check at the banks you are considering.
Is my money insured in an online savings account?
Your money should be safe in an online savings account, as long as the online savings account is insured by the FDIC. If so, your account is automatically insured for up to $250,000 per depositor, per account category, per insured institution.
What is the typical interest rate for an online savings account?
Interest rates vary over time and from bank to bank. Generally, online savings accounts have higher interest rates than traditional savings accounts, such as a rate of up to 4.00% APY or higher at press time.
How can online banks offer such good interest rates?
Because online banks don’t have the expensive overhead that comes with managing in-person banking locations, they can afford to pass their savings to their customers in the form of higher interest rates.
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.
SoFi members with direct deposit activity can earn 4.60% 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.
As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.60% 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 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 4.60% 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 10/24/2023. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.
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.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
Do you want to make money from your phone? I have been making money from my phone for many years now, and it’s a great way to make extra income or even a full-time income! Your phone can help you make money in many ways too. You can sell things you don’t need or use…
Do you want to make money from your phone?
I have been making money from my phone for many years now, and it’s a great way to make extra income or even a full-time income!
Your phone can help you make money in many ways too. You can sell things you don’t need or use your skills on freelance platforms. Answering surveys, selling photos, or being a virtual friend can also make you money, all from wherever you are comfortable.
Best Ways To Make Money From Your Phone
Below are the best ways to make money from your phone.
1. Answer surveys
You can earn money with your phone by answering surveys. Companies pay for your opinion, and you can do this whenever you have free time, such as when you’re just sitting on the couch watching TV with your phone in your hand.
Surveys are like a bunch of questions that companies ask to find out what you like or what you think about something. They might ask about the food you eat, the games you play, or even about your shopping habits.
You answer these questions, and in return, they give you money, points, or free gift cards (such as free Amazon gift cards) as a way to thank you for your time.
Some of the paid online survey companies I recommend are:
Here are 11 Paid Online Survey Sites if you want to learn more.
I have done many paid surveys over the years, and I love how I can answer them right from my phone and whenever I want. I can answer them while watching a video, during a lunch break, before or after work, and more.
2. Sell photos
You can use your phone to take pictures and make money. Selling stock photos is a fun way to make money through passive income without actively working for it.
Not all photographers need a fancy camera to start. Your phone can work perfectly and the newest smartphones can take great, high-quality photos. My phone can take great pictures and it wasn’t super expensive – it’s just a normal Android phone.
With stock photography, you can upload pictures you’ve taken with your camera or phone to a platform like Depositphotos. When someone buys one of your photos, you earn a commission.
Websites, companies, and blogs use stock photos for many reasons. Businesses use them to improve their content, websites, or overall appearance when they might not have the time to take all the photos they need.
I personally often use stock photos in my blog posts, and I know many others who do too. The pictures throughout this article (yes, the one that you are reading) are all stock photos.
Stock photography includes pictures of things such as:
Travel and landscapes
Business and finance, like laptops, offices, and people working
Family, such as parents and children
Household items, such as a living room and kitchen
Animals, such as pets and wildlife
Vehicles like cars and boats
Health and wellness, such as fitness-related images, healthy food, someone working out
Sports, from professional events to casual games
Recommended reading: 18 Ways You Can Get Paid To Take Pictures
3. Instacart Shopper
Making money through your phone is possible with grocery and food delivery apps like Instacart. As an Instacart Shopper, you get paid to shop for groceries and deliver them to people who order online.
Getting groceries delivered is a service that lots of people are using more and more. I’ve used it a few times when I didn’t have time to go shopping or didn’t have a car.
With this job, you have the freedom to make your own schedule, and you can get paid pretty fast – sometimes the same day.
Delivering groceries is a popular side job, and all you need is a valid driver’s license, a car, and your cell phone.
You earn money for each delivery and get to keep all your tips. Platforms like Instacart and Shipt can help you make around $15 to $20 per hour.
Learn more at Instacart Shopper Review: How much do Instacart Shoppers earn?
4. JustAnswer
JustAnswer is a site where you can make money by using your phone to help others. If you have skills or knowledge in a particular area, you can answer questions and earn cash.
JustAnswer states that you can make $2,000 to $7,000 a month as an expert answering questions online on their site.
People ask questions, and the site matches them with an expert who can answer. For example, someone might ask how to change their oil or why their cat is sick. As an expert, you’ll be answering questions and giving personalized help through text chat.
There are experts in fields like mechanics, doctors, lawyers, veterinarians, home experts, appraisers, computer and tech experts, and more.
You can work whenever you want from your computer or cell phone, and you get to choose which questions you want to answer.
To get started, apply online on JustAnswer. They’ll verify your credentials (every expert on this platform is verified by a third party and needs to have licenses, education, or employment in their field of expertise). Once approved, you’ll have a quick meeting with the JustAnswer team to learn how to use the platform.
It takes about one week to become verified, and you can receive payments through direct deposit, PayPal, or Venmo.
Recommended reading: 28 Ways To Get Paid To Text
5. DoorDash
When you want to make money with your phone, DoorDash is one way you can do that. DoorDash is a gig app where you deliver food to people.
Working with DoorDash means you’re part of the gig economy, delivering restaurant meals to customers. You have the flexibility to pick your hours and decide when and where you want to work.
Depending on your location, you can deliver food with a car or by bike.
The app is your main tool for the job, and it shows you your orders, where to go, and how to get there.
Your earnings depend on each delivery. You can make $2 to $10 or more, plus tips.
Please click here to sign up for DoorDash.
6. Fiverr
Fiverr is a way to make money from your phone as it’s an online platform where people do all sorts of online work, like writing, designing, or making videos.
Some services you can sell to make money from your phone include:
Chat support customer service – Manage customer service for a business as a freelancer.
Social media posting assistant – Help clients schedule and post content on their social media platforms, such as Instagram and Facebook.
Virtual fitness coaching – You can give fitness coaching sessions or create personalized workout plans from your phone.
Online language lessons – Teach language lessons through video calls or voice messages.
Life coaching – Share motivational messages, life advice, or coaching sessions through your phone, such as in phone calls or texts.
Mobile app testing – Test and give feedback on mobile apps for developers.
When someone buys your service from your listing, they pay Fiverr. Fiverr takes 20%, and you receive 80% of the funds after a 14-day pending period.
Another popular platform somewhat similar to Fiverr for freelancers is Upwork.
7. RentAFriend
If you’re looking to make money from your phone, RentAFriend could be an interesting choice. This platform allows you to get paid for being a friend.
As a RentAFriend, you might respond to text messages and have phone conversations with the person. You can be a friend in person, over video chat, or through text messages, depending on your preference.
With RentAFriend, you set your own hours and the price for your time. Earnings can range from $10 to $50 per hour, depending on what you decide.
Here’s how it works:
Sign up on the RentAFriend website.
Create a profile that shows who you are and what kinds of activities you enjoy.
Once your profile is live, people can find you and request your friendship services.
People join this site to find a friend and someone to talk to, and that’s where you come in.
8. Papa app
Papa is a website where you can chat with older adults, help them around their house and with shopping, and more.
You’re simply giving them some extra support with their day-to-day tasks, and you can earn money right from your phone for some of these tasks.
As a Papa Pal, you get to set your own schedule. The amount you can earn per hour varies depending on your location.
9. BetterHelp therapist
If you’re a licensed therapist, you might like making money using your phone with BetterHelp. BetterHelp is an online platform where therapists help people.
You can work with clients by chatting, phone calls, or video calls. You’ll need good internet and a private place to talk.
As a therapist on BetterHelp, estimated earnings are around $100,000 per year for working 40 hours per week. You can also work part-time at around 5 to 15 hours per week and earn around $8,000 to $27,000 each year.
To join, they require at least 3 years of experience in therapy for adults, couples, or teens.
10. Play games on your phone
There are many money making apps where you can get paid to play games on your phone.
Game apps pay real money rewards because they earn money through ads and in-app purchases. To motivate you to keep playing their games, they share a portion of their earnings with you.
Here’s a quick list of the top game apps that pay real cash:
KashKick
Swagbucks
InboxDollars
When selecting gaming apps to make money, it’s important to check reviews and understand how you receive your earnings. Be cautious with apps that require payment to play or promise rewards that seem too good to be true. Also, keep track of the time you spend playing games to make sure it is worth it.
Recommended reading: 23 Best Game Apps To Win Real Money
11. User Testing
UserTesting is a way you can make money by trying out websites and apps. Companies will pay you for your honest thoughts on how easy they are to use.
To participate in tests, you’ll need a computer or a smartphone, an internet connection, and a microphone. Some tests may also require a webcam.
When you test websites, you look out for things that don’t work well or can be confusing. Your feedback helps companies improve as they want real opinions, not just quick answers.
Here’s how it works:
Sign up with a user testing site.
They’ll give you tasks, like finding something on a website. Most tests take about 15 to 20 minutes.
You record your screen and talk about what you’re thinking.
After you’re done, you send your feedback.
You get paid! You could earn around $10 per test.
Payments are usually made through online services like PayPal.
I have personally paid someone to do a UserTesting review on this site, Making Sense of Cents. It’s a great way to see what a stranger thinks of your website and they gave me tons of helpful tips and let me know what changes I should make to make my website better for readers.
12. Sell used items online
If you have stuff you don’t use anymore, selling it online can be a smart way to make some money. Your old phones, clothes, games, and books could be worth something to someone else.
And, you can do all of this right from your cell phone!
Whether you have old things around your home that you want to sell or if you want to start a reselling business, there are many apps that make it easy to sell stuff right from your phone.
Some of the best selling apps are Poshmark for clothing, Worthy for jewelry, Facebook Marketplace for local sales, and Decluttr for electronics.
I have personally sold many items over the years on various sites to make extra income. At one point, I even had a small reselling business. So, I understand firsthand how helpful these sites and apps can be!
13. Sell your data
You can earn money from your phone by selling your data through apps. These apps pay you for the data you don’t use. You might be concerned about safety, but in most cases, it is safe.
These apps usually operate in the background, helping companies understand how people use the internet. Data apps aren’t full-time jobs and you won’t get rich from them, but they can be easy side gigs.
Honeygain is one app where you can earn cash, and you get paid for data you’re not using. You just install the app, and it runs without you doing anything extra.
You receive payment based on the amount of traffic passing through your connection, with Honeygain paying $1 for every 10 GB of traffic.
14. Instagrammer
If you love sharing photos and videos, Instagram can be a great way for you to make some extra money with your social media accounts.
I have made income from Instagram over the years, and while it’s not my full-time income, it is a fun way to make money from my phone.
This is because you can start an Instagram on whatever niche you want, such as fitness, travel, fashion, family, and more. So, you may be able to have a lot of fun managing and growing your social media account.
Then, you’ll want to make sure you regularly share high-quality content, use relevant tags, post reels, and interact with your audience to steadily increase your follower count.
15. Get paid to walk
You can actually make money just by walking! There are apps that track your steps and reward you for staying active. You can download these to your phone, start walking, and watch your steps turn into rewards.
Sweatcoin is one app you might like. If you’re over 13 and have a smartphone, you can join. It changes your walking into points that you can use. You can get stuff like gift cards or even support charities.
Getting paid is easy:
Join an app – Sign up for an app that fits you.
Walk and collect – Carry your phone and collect points as you walk.
Earn rewards – Swap your points for things like money to PayPal or cool products.
Some apps might hook up to a fitness tracker. This way, if your phone isn’t with you, you won’t miss out on any steps.
Frequently Asked Questions
Below are answers to common questions about how to make money from your phone.
How can I use my phone to make money?
You can make money on your phone by selling things you no longer need on apps like Decluttr or through your own store on platforms like Shopify. You could also complete online surveys, sign up for market research, or perform tasks on gig economy apps.
How can I make passive income on my phone?
One way to make passive income from your phone is to sell stock photography. You could take pictures from your phone, and then sell them over and over again online!
How can teenagers earn money using mobile apps?
Teenagers can earn money from their phones in their spare time by taking online surveys, performing tasks, selling products online, or using apps that reward users for maintaining good habits, like staying active.
How can I make $100 a day on my phone?
There are many ways to make $100 a day from your phone, such as selling items online and signing up for gig jobs like Instacart.
What are the quickest ways to make money on your phone?
The fastest ways to make money with your phone include taking surveys, using cash back shopping apps (because you may shop online a lot already!), playing games that have real rewards, and delivering groceries or meals with gig apps.
How can I learn how to make money with my phone without any investment?
There are many ways to make money from your phone for free, such as answering surveys, selling items that you already own (such as old clothing that you no longer wear, CDs, DVDs, or old devices that you don’t use anymore), driving for Uber, delivering groceries with Instacart, and more.
What apps can I use to make money with my phone?
Apps like Instacart, Papa, and Uber are all good ways to make side hustle money with your phone. There are many other ways that I didn’t mention above that are good options, such as Fetch Rewards (scan your receipt from grocery shopping), Acorns (micro-investing app for your spare change), Ibotta (a grocery shopping app), Neighbor (rent out your storage), Lyft (drive others around), TaskRabbit (sell your handyperson services, such as building furniture), OfferUp (selling stuff that you no longer need), and Rakuten (get cash back on your online shopping).
These apps are available on both Google Play stores and the iOS app store.
How To Make Money From Your Phone – Summary
I hope you enjoyed this article on the many ways to make money from your phone.
As you can see from the above, there are many ways to make extra cash from your phone, from part-time gigs to full-time income. Whether you have an Android or Apple phone, there are many ways on the list above that you may want to try out.
What do you think is the best way to make money with a phone?
Amtrak travelers can choose between 30 routes and over 500 destinations across the U.S. and Canada. Once you know where and when you want to go on your train trip, you’ll need to make your next decision: what class of travel to select.
While Amtrak offers private onboard cabins, most travelers choose between Amtrak coach and business class seats to save money. Learn the difference between coach and business on Amtrak, how to upgrade a coach ticket and how to earn rewards on your trip.
What is the difference in Amtrak coach vs. business?
The main difference between coach and business class tickets on Amtrak is found in the seats; a business class seat provides extra legroom and a wider seat. Other business class benefits include free nonalcoholic drinks and bonus Amtrak loyalty points, called Amtrak Guest Rewards points.
Coach seating on Amtrak
Coach class tickets on Amtrak feature reclining seats. Every seat includes a fold-down tray, an individual reading light and an electric outlet. Amtrak passengers can access free Wi-Fi, overhead baggage storage and a restroom in each train car.
You can purchase both reserve or unreserved coach class tickets, depending on your train route.
Reserved coach class tickets include a guaranteed seat for every passenger, whereas unreserved coach tickets are not guaranteed a specific seat.
🤓Nerdy Tip
Only the Pacific Surfliner and Capitol Corridor routes have unreserved coach seating. These tickets allow you to take an earlier or later train on the same day. You can even choose to travel at a later date up to one year from the reservation date.
Amtrak business class
Travelers who want an enhanced train travel experience on Amtrak should consider booking a business class ticket. These tickets feature extra legroom and wide, comfortable seats. Additionally, business class passengers receive complimentary nonalcoholic beverages on most routes.
Business class tickets sold outside of many routes in the Northeast Corridor do not include assigned seating. Instead, passengers are free to select any available eligible seat.
All members of Amtrak Guest Rewards can earn 2 points for every $1 spent on train tickets of any kind. However, when booking business class travel, you’ll receive 25% more points.
🤓Nerdy Tip
Amtrak Guest Rewards points are redeemable for train travel, hotels, dining and shopping. Train tickets start at just 400 points. Members can also purchase a single-station lounge pass for 1,500 points or a 12-hour one-class upgrade coupon for 2,500 points.
How can you book Amtrak coach and business tickets?
Amtrak offers four ways to book coach or business class tickets.
Online at Amtrak.com.
Through its mobile apps.
At a staffed train station.
Over the phone at 800-USA-RAIL.
The conductor can also help you with a seat or sleeper upgrade if space is available.
🤓Nerdy Tip
Before booking your Amtrak train seats, check out the latest promotions to save money on your trip. Amtrak routinely offers discounts for students, veterans, active-duty military and seniors.
Savvy travelers know to purchase their Amtrak tickets with a credit card that includes travel insurance benefits. These cards typically offer built-in protections in case your trip is canceled, interrupted or delayed — a helpful backup when you’re navigating various train schedules.
Amtrak coach vs. business fares
To illustrate the cost differences between coach and business on Amtrak, this chart shows the ticket price on May 1, 2024, between city pairs.
City Pairs
Los Angeles to San Diego
New York to Boston
Portland to Seattle
The cost varies by route and travel dates (you can expect to pay more during holidays and peak travel periods). You can make reservations up to 11 months in advance of travel.
Upgrading from Amtrak coach to business
If you want a business seat instead of a coach seat, you can upgrade your ticket. Upgrades are available online at Amtrak.com, through Amtrak’s app, at a staffed train station or by calling 800-USA-RAIL. You can also ask the conductor to help you on the day of travel if if unsold space is available.
The upgrade price varies based on your route and travel dates.
The bottom line
Business class tickets are more expensive than coach class tickets on Amtrak; for the up charge, you will receive a comfier seat with more legroom, points bonuses and complimentary nonalcoholic beverages (on most routes). You can upgrade your ticket from coach to business class in advance or on your travel day, assuming there is space available.
How to maximize your rewards
You want a travel credit card that prioritizes what’s important to you. Here are our picks for the best travel credit cards of 2023, including those best for:
Earned wage access is an employer-provided benefit that allows employees to access a portion of their paycheck ahead of payday. This can be immensely helpful for employees living paycheck to paycheck who incur unexpected, emergency expenses.
On-demand access to money that employees have earned can keep them from relying on more dangerous and costly alternatives, like payday loans, cash-advance apps, and even intentionally overdrafting their bank accounts. But earned wage access programs may also carry some fees, and they can inspire bad habits with budgeting and money management.
How Does Earned Wage Access Work?
Earned wage access (EWA) works similarly to a cash advance app, except that it’s an employer-provided benefit. Employees who work at a company offering this benefit can download the app of the third-party EWA provider that their company works with and then apply to access a portion of their paycheck.
Employers typically limit how much of a paycheck employees can access early. EWA providers charge a fee for this access. In some cases, the employee will have to pay the fee every time they use the service; in others, employers foot the bill as part of the benefit.
Recommended: What Are Credit Card Cash Advances?
Earned Wage Access Example
Here’s an example of how earned wage access (also sometimes called early wage access) might work in the real world:
An hourly employee earns $20 an hour, after taxes and retirement contributions. Though she receives her paycheck every two weeks, the employee realizes she needs money now to cover an emergency vet bill. She has already worked six days, meaning there are four working days before the end of the pay period — and more time before payroll processes.
She uses the EWA app that her company has partnered with to apply for early access to her paycheck. There is a $5 fee, but her company covers the cost as part of the earned wage access benefit. The EWA benefit is limited to 50% of her total pay for the period, so the employee then receives $800 ahead of her paycheck.
On payday, the employee usually receives a check for $1,600. Because she’s accessed $800 early, however, her paycheck will only be $800. 💡 Quick Tip: Some lenders can release funds as quickly as the same day your loan is approved. SoFi personal loans offer same-day funding for qualified borrowers.
How to Qualify for Earned Wage Access
Qualifying for earned wage access is easy. You just have to work at a company that offers it as a benefit. EWA is growing increasingly popular. Companies like Uber, McDonalds, and Walmart have all adopted early wage access as an employee benefit.
Unlike personal loans or credit cards, there’s no credit check to access the money early. Instead, you’ll just need to download the app of the program that your company has partnered with and connect it to your bank account or debit card to have the money transfer go through.
Earned Wage Access Pros and Cons
Earned wage access offers tremendous benefits, especially to employees who are struggling financially. However, EWA also has its fair share of drawbacks to consider.
Pros
• Fast access to money: The best way to handle unexpected expenses is to draw money from your emergency savings fund. In theory, the money will have been sitting there — in a high-yield savings account actively earning interest — so you don’t have to rely on credit cards, personal loans, cash advance apps, or payday loans. However, people who live paycheck to paycheck understandably can’t build an emergency savings fund. Earned wage access offers another path forward. You’ll be withdrawing money you’ve earned, just a little early. That means you aren’t taking on debt to cover life’s unexpected expenses.
• Easy to qualify: Taking out a personal loan for emergency expenses is often a smart idea if you don’t have the money in savings. But if your credit score is in poor shape, you might have trouble getting approved for a personal loan. Getting money through earned wage access may be easier. As long as your company offers this as a benefit, you don’t have to worry about credit checks and high-interest debt.
• No fees (or at least low fees): Many employers cover the admin fee of earned wage access for their employees as part of the benefit. Other employers might have arrangements with EWA platforms that don’t charge fees when employees access their funds early. Even if the employee is responsible for a transaction fee for an EWA, the cost is usually low.
Cons
• Smaller paycheck: When you need money in a pinch, earned wage access can be a great solution that doesn’t involve taking on debt. However, when payday arrives, your paycheck could be much smaller. Often, EWA platforms allow you to access up to 50% of your paycheck, meaning your payday will be cut in half. While you’ve covered the cost of the emergency expense, you’re now faced with paying your monthly bills on only half of your normal check. That could mean tightening your belt at the grocery store or making late payments on bills.
• A bad habit: Like cash advance apps or even payday loans, EWAs can be a slippery slope. You may access a portion of your paycheck early during one pay period, get a smaller paycheck as a result, and then need to turn around and access the next paycheck early to make up for your reduced paycheck. According to a 2021 study by the Financial Health Network, more than 70% of employees who utilized earned wage access used it in consecutive pay periods. It’s a difficult pattern to get out of — and could be even more detrimental if you change jobs and your new employer doesn’t offer EWA. In that case, you might be tempted to take out a predatory loan instead.
• Potential fees: In some cases, employees do have to pay for earned wage access. These fees are usually nominal, especially when compared to alternatives — overdraft fees from spending more than they have in their bank account or exorbitantly high interest rates for payday loans — but EWA fees should still be a consideration for people on a budget. Maybe there’s another alternative, like borrowing money from a family member or a payment plan for whatever emergency expense the employee has incurred.
Recommended: How to Avoid Overdraft Fees
Earned Wage Access vs Cash Advance Apps
Cash advance apps, also referred to as early payday apps, share some similarities with earned wage access. Both are typically managed through mobile apps and help you access cash flow ahead of your next paycheck.
Earned wage access, however, is offered solely through an employer. The employer may cover fees for the employees, and the amount a person can access is related to their actual paycheck.
With a cash advance app, consumers are responsible for any associated fees. Some apps may advertise no fees (and no interest), but they may charge a fee for instant transfers. Otherwise, you’ll have to wait a few days to get the money, which often defeats the purpose. Other cash advance apps might have a monthly charge.
The amount you can borrow through a cash advance app varies and may be tied to the cash flow of your linked bank account. Repeat borrowers may get approved for higher funds. Repayment is due on the borrower’s next payday.
Though hidden fees can make cash advance apps expensive, they’re generally a safer option than payday loans. 💡 Quick Tip: Just as there are no free lunches, there are no guaranteed loans. So beware lenders who advertise them. If they are legitimate, they need to know your creditworthiness before offering you a loan.
The Takeaway
Earned wage access can be helpful in an emergency situation, if your employer offers this benefit. However, EWA may come with fees, can make it more challenging to budget on payday, and may even lead to a recurring habit. As an alternative in an emergency solution, you can take out a personal loan. It won’t affect your upcoming paycheck, you can use loan moneyfor a variety of purposes, and it can give you the funds you need, at a low cost, to get through a financial hardship.
Think twice before turning to high-interest credit cards. Consider a SoFi personal loan instead. SoFi offers competitive fixed rates and same-day funding. Checking your rate takes just a minute.
SoFi’s Personal Loan was named NerdWallet’s 2023 winner for Best Online Personal Loan overall.
FAQ
Is earned wage access a loan?
Earned wage access is not a loan. It allows employees at participating companies to access money they’ve already earned, just ahead of schedule.
What are the benefits of earned wage access for employees
Earned wage access offers employees several benefits, including fast access to money they’ve technically earned, no or low fees, and easy qualification requirements. (You’ve just got to work for a company that offers this benefit.)
What are the downsides of earned wage access?
Earned wage access can have some downsides. Employees may have to pay fees to get early access to their paycheck, the amount you can access is often capped at 50%, and it can lead to a bad habit wherein you regularly need money before your paycheck.
Photo credit: iStock/Ivan Pantic
SoFi Loan Products SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
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.
Inside: Balancing a shoestring budget is possible and provides great rewards. With savings and budget strategies, you will find genius tips to manage your finances smartly!
With the rise of economic inflation, a growing number of people are finding the need for shoestring budgets to effectively navigate through their expenses.
Whether it’s planning for a low-cost holiday, initiating a frugal home makeover, or launching a start-up business with minimalist funds, the concept of a shoestring budget comes into play.
Moreover, it’s not only limited to low-income families but also extends to larger households and entrepreneurs that need to strategically lessen costs to achieve their goals. This is how many people reach financial independence sooner.
Then, let’s talk about a shoestring budget – an effective tool used to stretch finite resources, manage money wisely, and achieve financial goals, all while minimizing expenses.
If you’re familiar with the feeling of every dollar in your wallet counting, then this blog post is for you.
This post may contain affiliate links, which helps us to continue providing relevant content and we receive a small commission at no cost to you. As an Amazon Associate, I earn from qualifying purchases. Please read the full disclosure here.
What is a Shoestring Budget?
A ‘shoestring budget’ means to accomplish a task or a project within a very limited or bare minimum budget. The shoestring budget work strategy involves curbing discretionary spending dramatically to take care of high-priority expenses.
Understood across various contexts like travel, events, and lifestyle, the term implies an approach of resourcefulness and discovery of low-cost alternatives to achieve desired results.
Not exclusive to households with low incomes, working with a shoestring budget expresses the art of making what’s deemed impossible possible, navigating time constraints, and maximizing minimal available funds.
Shoestring Budget Idiom Definition
According to Merriam-Webster, the official definition of a shoestring budget is: 1
“involving a relatively small amount of money for planned spending.”
‘Shoestring Budget’ Origin
The phrase ‘shoestring budget’ has an intriguing origin story that dates back to the 1800s in the United States. Fact-checks reveal that this term is indeed a reference to the precarious nature of a thin and weak shoestring, metaphorically implying a scarce and strained budget.2
Several theories have been proposed regarding its original use.
One theory suggests that the term ‘shoestring gambler,’ meaning someone gambling with a limited budget, might be the precursor to the idiom.
Another theory, based on British history, suggests that prisoners would lower a shoestring out of their cell to collect small donations from passersby, symbolizing the idea of managing with few resources.
Despite the debates around the phrase’s exact origins, it is undisputed that it signifies a tight budget situation.
How to live on a shoestring budget?
Living on a shoestring budget can be challenging but doable with a bit of dedication and planning.
Start by reviewing your regular expenses per month.
Cut down on unnecessary expenses as much as possible.
Monitor your small, daily expenses as they can add up significantly over time.
Refinance any existing debt to reduce interest payments.
Renegotiate contracts with utility providers, subscription services (consider uninstalling unused ones), or insurance for better rates.
Shop at thrift stores or choosing used items over brand new can also help you save.
The key to surviving a shoestring budget is self-control and determination to avoid impulsive spending.
Your goal is to prioritize essential needs over wants – a no spend challenge will help you with this. Remember, regular tracking and analysis of your personal site usage can provide valuable insights to manage your budget better.
How to travel on a shoestring budget?
Embarking on an adventure while on a shoestring budget requires creativity and pre-planning.
Be flexible with your travel dates, destinations, and mode of transport to take advantage of the best deals available.
Consider options such as budget airlines, off-peak travel times, and less touristy locations.
Staying in budget accommodations, or even trying out housesitting, can significantly cut down your lodging costs.
Eating at local fresh markets rather than restaurants will not only save you money but also provide a more authentic experience.
Plan your daily activities; consider free local events, parks, and attractions.
Always carry a water bottle to avoid buying expensive drinks.
With careful planning, traveling on a shoestring budget can make your journey all the more rewarding and memorable.
How to Save Money on a shoestring budget?
Saving money while on a shoestring budget might appear challenging, but it’s not impossible. Begin by monitoring your expenditures and identifying areas where you can potentially save money. Also, consider substituting costly activities with more affordable or free ones.
Every small action counts when you’re on a shoestring budget, and these savings accumulate over time. Remember, consistent small savings can make a significant difference in the long run.
Starting a business on a shoestring budget
Starting a business on a shoestring budget requires careful financial planning and innovative thinking. Indeed, it may sound challenging, but numerous shoestring startups have surged to success by optimizing their business budgets. It is all about crafting a solid business plan that clearly delineates your budget and the efficient utilization of each dollar.
Maintain focus on essential expenses only. These expenses might include mandatory licenses, essential software for business operations, or even crucial industry-specific tools. Leverage your personal and professional networks for free advice and resources.
Also, make the most of free or low-cost online marketing strategies as these can be vital to shoestring business budgets. You can use effective strategies, like using different social media platforms for marketing or creating a blog, to broaden the reach of your business.
Remember, having the capital to start is important but it’s secondary to a truly novel idea, intense hard work, and a strategic approach. So, let your creativity thrive and work passionately towards growing your business.
Shoestring Budget Examples
Shoestring Vacation
Wedding or Honeymoon
Home Improvement
Business on a Shoestring Startups
Savings Goals
Financing your Next Car
A shoestring budget is not always related to bigger projects. It can also refer to the scenario where the money required for daily expenses, buying an item, or completing a project isn’t enough. Here, the person has to be creative and find ways to stretch the money to make ends meet.
Practical Tips for Surviving on a Shoestring Budget
In this section, we will present practical advice for managing a shoestring budget, derived from case studies of my readers and my own personal experience who have thrived despite financial limitations.
Whether you are budgeting on a low income or looking to reach FI number faster, this guide has you covered.
1. Starting with a Budget: Your First Step
Before you embark on your journey of living on a shoestring budget, the first step is to define a realistic budget.
Understand your total earnings and list all your monthly expenses.
Identify which expenses are necessary (rent, utilities, groceries) and which are discretionary (eating out, entertainment).
Now create a spending plan such that it covers all necessities, allocates some amount towards savings, and leaves a little for leisure.
A well-defined budget will be your roadmap to financial management success.
Remember, the goal is to live within your means but also to ensure you aren’t depriving yourself.
2. Make Saving Automatic
A proven way to save money on a shoestring budget is to make saving automatic.
In such a method, you can set up an automatic transfer when you get paid. Another idea is to use Acorns, which rounds up purchases made with your debit card to the nearest dollar and deposits the change daily into your savings account.
Essentially, you’re saving without even noticing it! These little amounts add up over a period and can really bolster your savings.
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3. Cut Back on Expenses
One of the most effective ways to operate within a shoestring budget is by reducing expenses. These can be small lifestyle changes, like cutting back on takeaways and preparing meals at home, walking or cycling instead of driving short distances or canceling unused subscriptions.
Specifically, you are looking to cut back your flexible expenses the most.
4. Look for Ways to Make Extra Money
Alongside cutting back on expenses, we continually stress the importance of finding ways to supplement your income. This could be from a side hustle, passive income, part-time job, or even a pay raise.
This additional income can help ease pressure on your shoestring budget. Also, it might provide an opportunity to explore new interests or passions. By diversifying your income streams, you make your financial situation more secure and flexible in unexpected circumstances.
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5. Utilize Free Resources
When it comes to saving money on a shoestring budget, the key is to utilize free resources and focus on essentials before spending money.
Thankfully, there are many vital ways to do this:
Find free things to do without spending money.
Use your local Buy Nothing group to find items before spending your hard-earned cash.
Learn and enhance your skills through free or low-cost online platforms like Udemy, Coursera, and YouTube.
Leveraging such resources can have a significant impact on your budget, leading to substantial savings for other meaningful expenses.
6. Look for Deals and Coupons
Another wise strategy when operating on a shoestring budget is seeking out deals and using coupons whenever possible. This game-changing approach can be applied to your grocery budget, dining, clothing purchases, and even travel.
Search for coupons in newspapers, magazines, or on coupon websites. Perhaps, subscribe to newsletters from your favorite retailers, a move that will provide straightforward access to information about sales and discount codes. Be mindful while shopping online or in stores, and always remember to rein in impulses, checking for any available discounts before purchasing.
Moreover, take advantage of holiday sales or Amazon Prime Day for larger purchases. Taking a little extra time to hunt for the best deals can significantly cut down your expenses and help you stick to your shoestring budget.
7. Utilize Household Resources
Leveraging what you already have in your household is another fantastic way to save money.
For instance, before running to the grocery store, take stock of what’s in your pantry and design meals around these items.
Also, consider repurposing and upcycling household items. An old ladder can turn into a chic bookshelf; jars can be used for storage.
Optimizing utility usage by switching off lights when not in use and limiting water usage can also reduce bills.
Start treating everything in your house as a resource with a specific purpose and value, including leftover food, old clothes, and used furniture. Every household item utilized efficiently can add up to visible savings over time.
8. Get Rid of Unnecessary Expenses
Perhaps the most crucial aspect of managing a shoestring budget is identifying and eliminating unnecessary expenses. These could include subscriptions to magazines or online services that you hardly use, dining out frequently, or buying expensive coffee daily.
Analyze where your money is going every month. You’d be surprised how the smallest changes can have a big impact on your budget. Eliminating even a few unnecessary monthly expenses can add up to substantial yearly savings.
Remember, the key is not to deprive yourself of everything but to find that balance between living comfortably and within your means.
9. Reduce Your Monthly Rent or Mortgage Payment
Want to slash a significant expense of your shoestring budget by considering ways to reduce your rent or mortgage payments? Could you move to a more affordable area or a smaller property?
For homeowners, look at refinancing your mortgage or negotiate better terms, resulting in lower monthly payments. Always remember to check if any fees would apply before proceeding with refinancing.
If relocation isn’t an option, consider renting out a spare room in your home or offering it on a vacation rental site.
If you are a renter, look at becoming a permanent housesitter.
Lowering these substantial expenses can make a huge difference in your budget, allowing you to allocate funds to other pressing areas, save, or even invest in building wealth.
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10. Be Creative When Paying Bills
When managing a shoestring budget, it can be helpful to get creative with the way you pay your bills. Sometimes, splitting payments between paychecks or paying on certain days can make managing your budget easier.
You could also consider bill negotiation services or check if you qualify for reduced rates based on your income. If meeting all payments becomes too strenuous, communicate with your service providers about it. They may have hardship programs or payment plans to assist during tough financial periods.
Remember, the key is to avoid late fees or penalties that could further strain your budget.
11. Leverage Technology to Save Time and Money
Make the most of technology to manage your shoestring budget. There are numerous mobile apps and online resources to help you track your expenditures, save money, pay bills, and even invest.
Budgeting apps can help you keep track of your income and expenditure, warn you when you’re nearing your limit, and provide valuable insight into your spending habits. Digital wallets can help you make secure transactions without the fear of losing cash.
Moreover, there are apps and websites to compare prices of different products, get the best deal alerts, apply instant coupons, or even earn cashback like Rakuten.
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12. Participate in a Mini Savings Challenge
As a fun and effective way to boost your savings, consider embarking on a mini savings challenge! These challenges break the intimidating concept of saving into manageable, small steps. They can vary based on duration and the amount you’re aiming to save.
For example, in a 52-week challenge, you save $1 in the first week, $2 in the second, and so on, until you’re saving $52 in the 52nd week. By the end of the year, you’ll have saved $1,378!
Not only does it make saving fun, but it also allows you to develop a consistent saving habit, crucial when budgeting on a shoestring.
Frequently Asked Questions (FAQ)
If you’re fortunate enough to have a budget that’s more than a shoestring, the principles discussed still apply. Having more resources doesn’t mean you should ignore opportunities to save and invest wisely.
So, whether your budget is minimal or ample, consider adopting these healthy financial habits to achieve your financial goals. Make sure to sock away any extra money into a savings or investment account so you aren’t tempted to spend it.
Starting to invest on a small budget involves several key strategies. You must pay yourself first each and every time you are paid.
Set up an auto savings plan through a high interest savings account to make sure you start earning interest.
Contribute enough to your 401(k) to take full advantage of your employer’s match, if available, and consider mutual funds with an initial investment as low as $500.
Pick one solid company wherein you believe data and financials are stable enough to invest in, and buy 1 share.
If you receive a work or tax refund bonus, allocate it towards your investments instead of immediate spending.
Key Takeaways: Managing Money Well on a Tight Budget
Managing finances on a shoestring budget can be a daunting task, but with the right strategies in place, it can become a way to achieve financial health.
This is something I did when I was a stay-at-home mom looking for ways to make money.
In the grand scheme of things, managing a shoestring budget is less about the money and more about your mindset. Yes, limited resources can present challenges, but your attitude and creativity can make a difference.
Embracing frugality, taking control of your financial choices, and building resourceful strategies can turn your constraints into opportunities.
Money comes and goes, but the ability to manage it effectively is a life skill that will always be beneficial. The real wealth lies in your ability to live within your means and make the most of what you have – turning your shoestring budget into a stepping stone towards financial independence and stability.
Remember, every journey starts small.
Day by day, these tips can help you improve your financial stability and achieve your goals, regardless of your budget size.
Source
Merriam-Webster. “on a small/tight/shoestring budget.” https://www.merriam-webster.com/dictionary/on%20a%20small%2Ftight%2Fshoestring%20budget. Accessed December 5, 2023.
Grammarist. “Shoestring Budget – A Creative Expression for Limited Money.” https://grammarist.com/idiom/on-a-shoestring-and-shoestring-budget/. Accessed December 5, 2023.
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