Wealth and Wants

SoFi credit card encourages investing, debt payoff

SoFi's reward structure favors cardholders who redeem cash back in other SoFi products


The SoFi Credit Card earns 2% back on all purchases – as long as you redeem your rewards to pay down debt, save or invest with SoFi.

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SoFi continues to grow its roster of financial services. The SoFi Credit Card is now available to all applicants, extending a portfolio which began with student loan refinancing almost a decade ago. The company later added a breadth of banking and investing products.

The SoFi Credit Card fits neatly into that ecosystem. It’s most lucrative when you pair it with other SoFi offerings. For example, SoFi cardholders earn 2 points for every dollar they spend. These are only worth 0.5 cents apiece when applied as a statement credit – equating to a rather ho-hum 1% cash back payout.

However, these points are worth a much more attractive 1 cent apiece (essentially 2% cash back) when cardholders use their rewards to pay down eligible debt, save or invest with SoFi. That puts it on par with the best no-annual-fee cash back cards: the PayPal Cash Back Mastercard, the Fidelity Rewards Visa Signature card and the Citi® Double Cash Card, which earns you 1% when you make a purchase and 1% when you pay it off.

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The SoFi card is similar to the Fidelity Rewards Visa, since Fidelity requires rewards to be deposited into a linked investment or cash management account. While this is more work than a standard cash back card, it also can lead to much more value.

How to stretch your rewards even further

I like the idea of earning additional upside from your rewards, to borrow a phrase from a past conversation with TomoCredit CEO Kristy Kim. This has become even more evident given the stock market’s meteoric rise over the past 11 months and the recent hubbub surrounding investments such as Bitcoin and GameStop. Personally, I’m more into buying and holding an S&P 500 index fund than those speculative investments, but to each their own. The point is, credit card rewards are found money, and some people like the idea of playing around with them.

Last year, I earned $1,732 in cash back from my credit card spending. If I invested that sum and earned 8% annually – a reasonable long-term assumption for a broad index such as the S&P 500 – I’d have $3,739 in 10 years. That’s without any extra contributions. If I added another $1,732 each year and achieved the same 8% annual return, I’d have a whopping $30,837 in a decade. Not bad at all for reinvesting “found money” rebated from purchases I would have made anyway!

SoFi’s target audience skews young, so many of them are probably paying down student loans. That’s another twist on playing with found money. If you have an undergraduate loan with SoFi, the current interest rates start at 2.99% for refinances and their variable private loans span from 1.87% to 11.66% APR. Avoiding some of that interest by reducing your balance with credit card rewards can be helpful. SoFi personal loans (which range from 5.99 to 20.69% APR) are also eligible for the 1 cent per point ratio.

See related: Best student credit cards

And while the SoFi Money cash management account yields just 0.25% at present (down from 1.60% about a year ago), everyone needs emergency savings. This is a cash-like way to redeem your SoFi Credit Card points for 1 cent apiece. It’s more about the peace of mind than the return. And because those rewards are worth twice as much when you put them into a SoFi account as opposed to receiving a statement credit, it’s well worth it.

I’d argue that establishing the habits of saving, investing and paying off debt could be even more valuable than the aforementioned numbers. If using your credit card rewards for any of these purposes motivates you to save more, invest more or pay down debt more aggressively, it’s an even bigger win.

Additional benefits 

The SoFi Credit Card also offers complimentary cell phone insurance (up to $800 per claim and $1,000 per year with a $50 deductible), a free ShopRunner membership (which gives free two-day shipping and returns at 100-plus popular stores) and discounts or credits from Lyft (up to $10 per month) and Boxed (5% cash back).

Final thoughts

While it’s not as simple as many other cash back cards, the SoFi Credit Card is worth considering if you already have a different SoFi account or if you’re interested in investing via their platform.

Have a question about credit cards? E-mail me at and I’d be happy to help.

Editorial Disclaimer

The editorial content on this page is based solely on the objective assessment of our writers and is not driven by advertising dollars. It has not been provided or commissioned by the credit card issuers. However, we may receive compensation when you click on links to products from our partners.

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