Ally Bank Increases Rates on 1-Year, 5-Year and Raise Your Rate CDs

POSTED ON BY

Deal Summary: 1-year CD, 1.30% APY (increase of 25 bps); Also, rate increases on 5-year CD, 2-year Raise Your Rate CD and 4-year Raise Your Rate CD.

Availability: Internet Bank

Ally Bank increased the rate of its 1-year CD by 25 basis points. The new rate is now 1.30% APY for all balances. In addition, Ally increased the rates by 10 basis points of its two Raise Your Rate (RYR) CDs. The 2-year RYR CD has a 1.40% APY, and the 4-year RYR CD has a 1.50% APY. The 1-year CD and the two RYR CDs currently have no rate tiers. There is no minimum deposit to qualify for the top rates.

The 5-year CD used to require a $25k minimum to qualify for a 2.00% APY. Smaller balances earned lower rates. That has been removed, and now there is no minimum balance to qualify for the 2.00% APY. Note, Ally started rate tiers in 2015, and the rate tiers still apply to some CDs.

APYMINMAXINSTITUTIONPRODUCTDETAILS
2.00*%--Ally BankHigh Yield 5 Year CD
1.50*%--Ally BankRaise Your Rate 4-Year CD
1.40*%--Ally BankRaise Your Rate 2-Year CD
1.30*%--Ally BankHigh Yield 12-Month CD
Accounts mentioned in this post. Rates as of March 24, 2017.

The above CDs are also available as IRAs (Traditional, Roth or SEP), earning the same APYs with the same minimum deposit requirements.

These new rates aren’t exceptional, but they’re competitive with other major internet banks. It’s interesting to note that Capital One increased its 1-year 360 CD rate to 1.30% APY earlier this month. The latest Fed rate hikes and bank competition appear to be having an effect, at least on internet bank CD rates. Hope we’ll soon see upward movement on savings account rates.

One advantage Ally’s 1-year CD has over Capital One’s 360 1-year CD is a lower early withdrawal penalty (EWP). Ally’s 1-year CD EWP is 60 days of interest. Capital One’s EWP is three months of interest. Even though other internet banks are offering higher 1-year CD rates, the lower EWP can make Ally’s CD a better deal. Here’s a comparison of 1-year CDs at Ally, Capital One and PurePoint Financial using our Early Withdrawal Penalty Calculator.

Higher Raise Your Rate (RYR) CD Rates

In addition to the the 1-year and 5-year CD rate increases, Ally increased the rates of its two RYR CDs. This is the first time the RYR CD rates have gone up since 2015. For those who have Ally’s RYR CDs, this might be a good time to use the bump-up option. The 2-year RYR CD has one bump-up option and the 4-year has two.

A Few Noteworthy Ally Account Features

As mentioned above, Ally’s CDs have mild early withdrawal penalties as compared to CDs at other banks and credit unions. Ally has the following description of its EWPs on its website for CDs purchased or renewed after 12/07/13:

  • 24 months or less: 60 days of interest
  • 25 months – 36 months: 90 days of interest
  • 37 months – 48 months: 120 days of interest
  • 49 months or longer: 150 days of interest

One downside with Ally’s CDs is that they don’t allow partial early withdrawals. If you need some of your CD principal before maturity, your only option is to close the CD and withdrawal the entire amount.

One positive feature of Ally’s CDs is their “Ten Day Best Rate Guarantee.” This guarantee says that if you fund a new CD within 10 days of opening the account, you’ll get the best rate Ally offers for your term and balance tier if Ally’s rate goes up during that time.

Another nice aspect of Ally’s CDs is their online CD management software. When you log into your account, you can change things like how interest is disbursed. Ally allows you to have the interest paid monthly, quarterly, semi-annually or annually. You can also change how interest is paid. You can choose for the interest to be credited back to the CD, paid out to your account or paid as a check. The software can also be used to change renewal options and to request an early withdrawal. The software lets you see the current balance and the post-penalty balance before you make the decision to close the CD early. You have the choice to have the funds from the closed CD transferred online to your account or sent as a check.

Another nice aspect of all of Ally’s accounts is the ability to designate beneficiaries. You can choose up to 10 beneficiaries for each of your non-IRA accounts, and you can choose the designation of either “In Trust For” or “Payable On Death”. Beneficiary designations can be done online in the application or with the account management software after the account has been opened.

Ally also allows customers to open an account in the name of a Trust.

Availability

Headquartered in Midvale, Utah, Ally Bank is currently the 23rd largest bank in the country, with assets in excess of $114 billion and over 2.2 million customer accounts. Ally offers its services and product line to individuals 18 years or older, who have a valid Social Security number and a U.S. mailing address.

Applying for the 13-month select CD can be done using Ally Bank’s online application or by calling Ally (877-247-2559). You can fund your new account in a few different ways:

  • Transfer from an Ally or non-Ally account
  • Check (by mail or Ally eCheck Deposit)
  • Wire transfer

Bank Overview

Ally Bank (FDIC Certificate # 57803) has an overall health grade of "A+" at DepositAccounts.com, with a Texas ratio of 1.76% (excellent) based on December 31, 2016 data. In the past year, Ally has increased its deposits by $11.15 billion, an excellent annual growth rate of 20.04%. Please refer to our financial overview of Ally Bank for more details.

How the 1-Year CD Compares

When compared to 101 similar length-of-term CDs offered by internet banks tracked by DepositAccounts.com, 12 banks offer a higher rate than Ally’s 12-month CD rate. The table below shows how Ally’s 12-month CD compares to a few of the top 1-year CDs from internet banks:

Interest RateCD Length of TermEarly Withdrawal PenaltyInternet Bank
1.45% APY1-year CD ($10k min)181 daysPurePoint Financial
1.35% APY1-year CD ($2k min)90 daysSynchrony Bank
1.30% APY1-year CD (no min)60 daysAlly Bank
1.30% APY1-year 360 CD (no min)3 monthsCapital One Bank

The above rates are accurate as of 3/24/2017.

To review the highest CD rates, both nationwide and in your state, please refer to our CD rates table or our Rates Map page.

Comments
Ronald Hurley
Ronald Hurley   |     |   Comment #1
How can it be stated that Ally rate increases the rate on the 5-year CD when the rate is still at 2.0%?
Ken Tumin
Ken Tumin   |     |   Comment #2
Rates went up for balances under $25k. Deposits under $25k used to earn 1.90% (under $5k) and 1.95% ($5k to $25k).
Saver
Saver   |     |   Comment #4
Thanks for clarification.
qed
qed   |     |   Comment #3
The "deal summary" would be more useful if it mentioned the actual APY, rather than just staring it went up.
Ally Bank Raises Its 5-Year High Yield CD Rates

Deal Summary: 60-month CD, 2.00% APY, $25k minimum deposit

Availability: Internet Bank

Last Friday, Ally Bank increased the rates of its 5-year High Yield CD by 25 basis points. The top tier now has a 2.00% APY, with a minimum deposit of $25k. Slightly lower rates are available for smaller deposits (1.95% APY for a $5k minimum and 1.90% APY with no minimum). These rates and tiers also apply to Ally Bank’s IRA 5-year CD. Note, Ally Bank began rate tiers in 2015.

These new rates aren’t exceptional, but...

Continue Reading
Ally Bank Offers Limited-Time 13-Month Select CD

Deal Summary: 13-month CD, 1.25% APY, no minimum deposit

Availability: Internet Bank

Ally Bank is again offering a select CD which features a limited-time promotional rate and term (1.25% APY 13-month). This is a small improvement to Ally’s last select CD in October which had the same rate but a 15-month term. This is also the same rate as the 11-month No Penalty CD special that Ally was offering in December and early January. That No Penalty CD rate is back down to 0.87%. This new select CD is...

Continue Reading
Large Rate Increase on Ally Bank’s 11-Month No Penalty CD

UPDATE 1/4/17: The No Penalty CD APY has fallen from 1.25% to 0.87%.

Availability: Internet Bank

This might be a sign that Wednesday’s Fed rate hike will have an effect on deposit rates. Ally Bank just raised the APY of its 11-month No Penalty CD by 38 basis points to 1.25%. This is the highest APY that Ally Bank has offered on this CD since 2010.

The 1.25% APY applies to all balances. Ally Bank added rate tiers in 2015, but this 11-month CD currently has just one rate...

Continue Reading
Ally Bank Increases 18-Month and 3-Year CD Rates
Availability: Internet Bank

Ally Bank increased the rates of two of its High Yield CDs today. The rates increases are small, but it’s another positive sign that we may finally be at the start of a rising interest rate environment.

The rates increased by 5 basis points for the top balance tiers ($25k+) of both the 18-month CD (1.35% APY) and the 3-year CD (1.60% APY). Rates for the lower tiers did not change, except for the mid tier ($5k-$25k) of the 3-year CD which increased by 3 basis points...

Continue Reading
Ally Bank Offers Another Limited-Time Select CD
Availability: Internet Bank

It’s not only Columbus Day, but it’s also National Online Bank Day. This was a day that Ally Bank first promoted last year to highlight the benefits of internet banks. Most brick-and-mortar banks are closed for Columbus Day, but many internet banks (including Ally) are open with customer service taking calls.

To celebrate the occasion, Ally Bank is offering a new Select CD, which features a limited time promotional rate and term (1.25% APY 15-month).

Features of this 1.25% APY 15-month Select CD include :

    Promotional rate and term...

Continue Reading

More Past Offers