Sofi Invest Review

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Andrew Hayward
SoFi logo

SoFi (Social Finance) has a surprising number of products available for an investment startup and for automated investing. You can access personal loans, life insurance, credit cards, financial centralization student loan refinancing, banking, investing, credit scores, and recently crypto trading.

In this Sofi Invest review, every aspect of Sofi’s services have been researched to provide investors with an unbiased account of Sofi’s strength’s and weaknesses as an investment broker and SoFi automated investing software to help users decide if they are the right broker for them.

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Who is Sofi Invest?

SoFi securities LLC was founded in 2011 by 4 Stanford graduates. Their original aim was to reduce student debt costs to let more qualified students attend expensive schools. In 2013, only two years after founding, SoFi raised $500 million in debt and equity to launch a SoFi Invest account and an automated investing account. They reduced management fees by charging interest on margin and on deposits.

SoFi has two components, active investing and robo advisors both with a $0 commission. They do not provide automatic tax loss harvesting. For advanced questions about the sofi automated investing portfolios and tax loss harvesting, you do have access to financial advisors.

Your bank account must be linked, verified and approved through our account selection and instant verification process. Accounts added manually via routing and account number are not eligible. SoFi is good for customers that are new and have a lower risk tolerance. Your bank account must have a reported balance greater than or equal to your first deposit.

Why choose Sofi invest?

They have done an excellent job in adding products with the customer in mind, including tracking your account, cheap life insurance ($5/month), invest ($1 to start), free credit scores, and more. The rates and breadth of accounts available are a serious positive compared to other discount brokers.

Sofi Invest Ratings

Overall


Overall Rating:
80%
Fees:
60%
Account opening:
60%
Deposit and withdrawal:
60%
Trading platform:
80%
Markets and products:
80%
Research:
40%
Customer service:
60%
Education:
40%

Pros

  • Focus on socialized finance
  • Huge list of financial options
  • $0 commission on investments

Cons

  • Long withdraw times
  • No futures trading for shorter term trades
Sofi invest review

SoFi Invest Fees and Pricing

Sofi, unlike the majority of other major robot-advisors, charges no management fees.

Sofi automated investing has expense ratios averaging at a competitive 0.05%. The minimum amount required to open an account is $5. There are no fees for trading stocks or ETFs on SoFi’s platform.

Common questions I get asked about SoFi Invest

These are the most common questions I get asked about SoFi Invest, so I will try to answer these as best I can, to give you a better view on whether SoFi Invest is the right investment choice for you.

Is Sofi Trading regulated?

Sofi Trading is a regulated by the Financial Industry Regulatory Agency (FINRA), an independent, not-for-profit organization authorized to protect America’s investors by making sure the securities industry operates fairly and honestly. The company is also a broker-dealer and therefore the company is governed by the Securities Exchange Commission (SEC) which regulates and polices the securities industry in America.

How do I get my money back out of Sofi Trading?

Here are the wire instructions, which you can initiate without charge:

Bank Name: U.S. Bank Bank Address: 80 S 8th Street, Minneapolis, MN 55402 or,

Portland, OR ABA/Routing #: 123000848 Beneficiary: Wedbush Securities, Inc.

Beneficiary Address: 1000 Wilshire Blvd, Los Angeles, CA 90017

Beneficiary Account: 153910900825 For Further Credit to (FFC):

Your name and account number* For cash account types, add a “1” to the end of your account number. For margin account types, add a “2” to the end of your account number.

Is Sofi Invest good for beginners?

Yes, Sofi has the educational resources and focus on onboarding new traders to the business to serve as an excellent start for new traders looking to get into the market. They provide ETF’s and index funds, with no account management fees or annual management fee. They also have access to certified financial planners who can help you set up an investment strategy. SoFi also has a relatively high interest savings account, with a 1.25% savings rate, whereas JP Morgan is still offering only .01% savings rates. SoFi also offers automatic rebalancing, financial products, taxable accounts and IRA accounts, and ETF’s are excellent for cost conscious investors and passive investors with human advisors and you can trade ETF’s and stock investing and other asset classes for $0.00 expense ratios.

Can you cancel Sofi Trading at any time?

Yes, you can cancel at any time. However, remember that you cannot transfer a portfolio of stocks without paying a hefty fee. If you sell all your securities, you can transfer your cash instantly with a wire or ACH transaction.

What happens if Sofi Trading goes out of business?

The SIPC and SEC will pay you back up to $500,000 for securities lost. However, this only applies to a total collapse in your brokerage firm. Normal market movements in SoFi will not be reimbursed.

Can you trade Forex on Sofi Trading?

No, unfortunately SoFi only offers stocks, ETFs, and options. Futures and Forex are not available. One note on this policy is that the Forex markets are the most liquid and hardest to trade, and I agree with SoFi not offering them to beginning investors because you really need to be at least an intermediate level trader before you tip you toes in the swirling waters of the Forex market.

Are Penny stocks tradeable?

Sofi Invest does not offer investing in penny stocks, pink sheets, and OTC BB (Over-The-Counter Bulletin Board) stocks. Similar to Forex, these markets have specialized risk characteristics not appropriate for a new trader.

Is day trading illegal?

You have to qualify with Sofi Trading and the exchanges to qualify. You should assess your personal financial situation before you apply for PDT (Pattern Day Trading).

Does capital gain count as income?

Capital gains in the U.S. result in tax rates of 0%, 15%, or 20% for assets held more than a year. For less than a year, profits are taxed at ordinary income such as 10%, 12%, 22%, 24%, 32%, 35% or 37%.

When is my deposit available to use?

You can invest up to your instant funding limit instantly* once you begin a transfer with your linked bank account (you’ll need to meet certain requirements for this). Any amount deposited over your instant funding limit will be available for trading 3 business days after posting. This amount will be included in your ‘Pending/Upcoming Buying Power’.

What are the stock trading fees?

There are no fees when you buy and sell stocks or ETFs with SoFi. We want to make investing available to more people, and one way to do this is to reduce the barrier to entry.

Are the orders real time?

Yes, orders are entered in real time. Market orders are not able to be accepted outside of market hours or when a trading of a certain stock is suspended.

Does my cash balance earn interest?

No, but your money is readily available for you to make trades when you’d like.

Can I receive advice on purchases of securities?

No. SoFi Invest doesn’t offer investment advice.

SoFi members are able to tap into a team of Certified Financial Planners that are dedicated to helping you make sure your overall financial strategy is aligned with your personal goals. You can make an appointment to speak with a CFP at https://go.oncehub.com/sofifp_relayca.

How do I get my financial statements?

All of your statements from the last two years are available online and you’ll get an email notification when they’re there to view. You can see all of your statements by logging into “Your Invest E-Documents”.

What are the tax implications?

Whenever a security is sold in a taxable account, there may be a potential taxable event. The main difference between a taxable account and a tax-advantaged account are that the tax-advantaged accounts are for retirement (such as an IRA). If you have questions about your taxable account implications, we suggest consulting with a tax professional.

Will I receive end of year tax documents?

Yes. Once they’re processed, tax documents will be available electronically in the document center of the Invest account.

During what hours can I place a trade?

Trades are able to be scheduled any time 24/7, but stock purchases can only be executed Monday-Friday 9:30 a.m. to 4 p.m. ET, with the exception of holidays and when a certain asset is halted or suspended. If you place an order outside of that time, you can choose to schedule your order as Market on Open, which will execute at the market open on the next business day.

How long would it take to get access to the money I make when selling a stock?

It would take typically 3-5 business days. Proceeds from selling a stock will settle in a brokerage account two business days after the sale. After that, withdrawals from the brokerage account may take 1-3 business days to reach the linked bank account.

What is a stock?

A stock is a share of a company held by an individual or group. One way corporations raise money is by selling stocks, giving stock owners (also known as shareholders) partial ownership of the corporation. Stocks are typically bought and sold on what is called an exchange, like the New York Stock Exchange.   

How long does it take to be approved for Sofi?

Most applications are processed in in 1-2 days. Sofi will reach out if they need more information, or you can call or email for a status check anytime.

Can you cancel Sofi Trading at any time?

Yes, you just have to wait for the the entire portfolio cash settles into cash so you don’t have to pay the ACATS $95 fee. If you’re a little more patient you can transfer your account cash by wire for $25 fee.

Can I see P&L across multiple account types?

Yes, equities, options, and futures will all be displayed in your Positions Window on Sofi Trader intraday and will be combined for your not P&L calculation.

Can you trade Forex on Sofi Trading?

Yes, but only the Eze EMS platform will trade Forex.

Is day trading illegal?

You have to qualify with Sofi Trading and the exchanges to qualify. You should assess your personal financial situation before you apply for PDT (Pattern Day Trading).

How long must you hold a stock to avoid capital gains?

Any security held for less than one year does not qualify for capital gains tax treatment.

SoFi Invest FAQs

Does buying into an IP cost fees?

No, IPO trading is free just like stock and ETF trading.

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