SoFi Invest Review 2024: Pros, Cons and Alternatives (2024)

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SoFi Invest® is our top pick for the best investment app for beginners, providing straightforward investment strategies and commission-free trades. US active investors looking for an intuitive online trading experience — or hands-off investors wanting personalized automated portfolio management — can benefit from a SoFi brokerage account. However, SoFi's limited investment selection and features might not fit advanced traders well.

About SoFi Invest

SoFi Invest is an all-inclusive online brokerage for both passive and active investors. Buy IPO stock, build your nest egg, or invest in alternative investments like venture capital, private credit, and commodities. Cryptocurrency trading on SoFi Invest is no longer available.

The easy-to-use platform provides investors with portfolio-balancing tools, financial planners, and curated content from SoFi's educational content hub. As one of the best robo-advisors, SoFi's cost-effective automated trading platform offers goal-based investing strategies, simple diversification, and auto-rebalancing.

You can trade stocks, ETFs, fractional shares, IPOs, options, commodities, and other alternative investments. Stocks, fractional shares, and ETFs are available for commission-free trading with SoFi Invest.

But if you're simply looking to start investing, SoFi has all you need, with complimentary access to Certified Financial Planners (CFPs). Only US residents are eligible to open an account.

Who is SoFi Best For?

SoFi Invest is best for traders wanting to invest in commission-free stocks, ETFs, and options. It offers a good selection of accounts, including a self-managed brokerage account, a robo-advisor, and retirement savings accounts (both active and automatic options available).

Educational resources and financial advice from SoFi make it ideal for beginner investors looking for low-cost trades and strong financial planning resources.It's also a great option for folks with other SoFi accounts as it is easy to move money between SoFi Checking and Savingsand SoFi Invest accounts.

However, SoFi doesn't offer tax-loss harvesting. Advanced traders can only access stop-limit orders for whole shares during market hours. It's also not great for traders wanting to invest in cryptocurrencies as SoFi no longer supports crypto-trading. The remaining SoFi crypto accounts migrated to Blockchain.com.

SoFi Invest Pros and Cons

SoFi Pros

• Low fees and account minimums
• Commission-free stocks and ETF trades
• Multiple account options, including a robo-advisor, IRAs, and margin
• Varying investment options (stocks, ETFs, fractional shares, IPOs, options, private credit, venture capital, commodities)
• Financial and estate planning features

SoFi Cons

• Doesn't offer tax-loss harvesting
• Only invests in US assets
• $2,000 account minimum for margin accounts
• No longer support cryptocurrencies

Is SoFi Invest Trustworthy?

SoFi has received an A+ rating from the Better Business Bureau. The BBB uses a grade range of A+ to F when evaluating company trustworthiness and considers several factors — including customer complaint history, licensing and government actions, and advertising issues — when reaching a final rating.

The BBB says its ratings don't guarantee a company's reliability or performance.

December 6, 2023, FINRA sanctioned four firms (M1 Finance, Public Investing, SogoTrade, and SoFi) to pay $2.6 million for allegedly failing to establish, maintain, and enforce a supervisory system. The brokerages agreed to pay the $2.6 million without admitting or denying the charges.

Ways to Invest with SoFi

Active investing account

SoFi Active Invest is a brokerage account that gives you 100% control to buy and sell commission-free stocks, ETFs, and fractional shares. Options trading is also available a multiple trading levels (SoFi currently offers long puts and cover calls and buy writes) and with no contract fees.

As the name implies, this account is best for active traders wanting to pick and choose their portfolio of investments. Those with a SoFi Active account are automatically eligible to become a SoFi member, which grants you access to product discounts, exclusive events, and more.

As a member, you can also invest in initial public offerings (IPOs) for no minimum, which are shares sold by privately owned companies to the general public. In addition, members can access broader portfolio diversificationn and growth potential by investing in alternative investments like commodities, foreign currencies, real-estate, and pre-IPO unicorns. Access short-term money market funds, interval funds, and professionally managed mutual funds.

SoFi Automated

SoFi Automated Investing accounts to invest your funds in a pre-built portfolio of SoFi ETFs and ETFs from other brokerages like Vanguard and BlackRock. SoFi assesses your risk tolerance, time horizon, and investment goals to create your investment portfolio.

Automated investing solutions by SoFi include goal-planning strategies like saving for a home, retirement, getting married, planning to travel, or setting up a college fund. For no extra cost, automated accounts come with one-on-one guidance from financial advisors to help you reach your goals.

Access investment planning tools like automatic portfolio rebalancing (every quarter), recurring deposits, and portfolio diversification tools. Regarding account types, SoFi Automated Investing supports individual investment accounts, joint accounts, and IRAs.

You only need $1 to start investing. There are no advisory fees with SoFi Automated Investing.

Retirement savings accounts

All SoFi active and automated IRAs are eligible to earn an automatic 1% match on contributions. That means every dollar deposited into your account will receive a 1% match from SoFi. Match contributions won't count toward your annual contribution limit.

Like other automated accounts, SoFi's robo-advisor creates a customized portfolio of stocks and bonds based on your risk tolerance, time horizon, and retirement goals. However, IRAs are also available as active investing accounts.

Retirement account options include:

• Traditional IRA
• Roth IRA
• SEP IRA
• Rollover IRA

You'll also get access to a handful of financial tools and planning resources, including SoFi financial planners, goal-building tools, auto rebalancing (for automated accounts), and member benefits.

Margin trading accounts

If you're eager to invest but don't currently have the funds to make the purchase, you can open a margin trading account and take a loan from SoFi that finances up to 50% of your next investment purchase. SoFi can also loan you cash at a 11% annual interest rate. The payback feature assists you in paying back your loans on time.

Toward the bottom of the webpage on margin trading, SoFi warns against inexperienced investors opening a margin account due to the increased risk associated with margin trading. Investors are also required to have at least $2,000 in their accounts.

Investment options

SoFi offers stocks, bonds, fractional shares, ETFs, options, and IPOs with a focus on building long-term wealth. Investment options will vary based on the kind of account you open. For example, only folks with an Active Investing account can access IPO trading.

Most of SoFi's investing portfolio diversification focuses on low-cost Core ETFs and Thematic ETFs, like:

• SoFi Select 500 ETF (SFY): Assets from 500 of the largest publicly traded US companies
• SoFi Next 500 ETF (SFYX): Assets from 500 mid-level US companies
• SoFi Weekly Income ETF (TGIF): Mix of investment grade and high-yield fixed-income securities
• SoFi Weekly Dividend ETFs (WKLY): Assets from global companies that consistently pay dividends
• SoFi Web 3 ETF (TWEB): Fast-growing technology companies building the next generation of the internet
• SoFi Smart Energy ETF (ENRG): Companies that focus on sustainability and building cleaner, reliable energy systems
• SoFi Be Your Own Boss ETF (BYOB): Companies developing new ways to improve access to goods, services, and work
• SoFi Social 50 ETF (SFYF): SoFi's top 50 stock options

Available alternative investments include a range of commodities, venture capital, real estate, foreign currencies, private credit, hedge funds, and pre-IPO unicorns.

SoFi Fees

Low fees are one of SoFi's biggest perks. It doesn't charge advisory or management fees, and certain trades are commission-free (stocks, ETFs, and fractional shares). There technically isn't an account minimum to open a SoFi Invest account. But there is a required $1 minimum to start investing for all account types.

Fractional shares can be bought in quantities of $5. So even though it isn't technically an account minimum, you won't be able to purchase fractional shares of a stock or ETF unless you have at least $5 in your account. Similarly, you need at least $2,000 to open a margin trading account.

Margin trading charges a 11% annual interest rate on your margin loan that is accrued daily and is deducted from your account once per month. Your interest rate is calculated daily by automatically multiplying your outstanding margin debit balance by the 11% annual interest rate and then dividing by 360.

SoFi Invest Alternatives

SoFi Invest vs. Robinhood

SoFi Invest and Robinhood are competitive investment options for low fees, simple user interfaces, and IRA matching contributions. However, each platform offers different account types and investment choices.

Robinhood and SoFi Invest are the only online brokerages that offer matching bonuses on IRA contributions. Currently Robinhood provides a 1% match (3% for Gold members).

While both are great for traders of stocks, ETFs, margins, and fractional shares, SoFi offers a wider range of account types (e.g., automated investing accounts and more IRA options). Robinhood Investing doesn't offer a robo-advising option or SEP IRAs.

If you're interested in margin trading, Robinhood offers a lower interest rate for Robinhood Gold members (ranging from 8%) compared to SoFi. But non-Gold members will have to pay up to a 12% interest rate, making SoFi the better option.

Robinhood review

SoFi Invest vs. Wealthfront

SoFi and Wealthfront mainly differ when it comes to investment types and features. SoFi and Wealthfront Investing both offer self-directed and automated accounts. However, Wealthfront also offers 529 plans, a high-yield bond portfolio, and crypto trusts.

With a Wealthfront brokerage account, you can invest in stocks, fractional shares, ETFs, index funds, and bond ETFs. Self-directed Wealthfront accounts have a $1 account minimum, but automated accounts have a much higher $500 account minimum. So, if you're seeking out a robo-advisor specifically, SoFi could be a better option.

But unlike SoFi, Wealthfront does offer tax-loss harvesting and additional features like US direct indexing and smart beta tools.

Wealthfront review

Methodology: How We Reviewed SoFi Investing

When reviewing investment apps, we use Personal Finance Insider's rating methodology for investing platforms to compare and examine pricing, account types, investment availability, and overall customer experience. Each platform receives a rating between 0 and 5.

Investment platforms offer varying assets, financial tools, fees, and other resources. Some investment apps are better for more advanced investors or active investors, while others may better suit beginner investors and passive investors. SoFi Invest was evaluated with a focus on how it serves in each category.

Business Insider's Overall SoFi Rating

SoFi — Frequently Asked Questions (FAQs)