Ally Bank Increases Online Savings Account Rate

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Deal Summary: Online Savings Account, 1.45% APY as of 2/9/18. No minimum balance

Availability: Nationwide (internet bank)

This morning, Ally Bank increased the rate of the Online Savings Account (OSA) by 10 bps to 1.45% APY as of 2/9/18. The OSA has no balance tiers. This APY applies to all balances. Also, the same APY applies to the IRA Online Savings. The OSA has no monthly maintenance fees. Unlike previous rate change days at Ally, no other products had rate changes today. Last Friday, Ally raised rates on several of its CDs.

APYMINMAXINSTITUTIONPRODUCTDETAILS
1.45*%--Ally BankIRA Online Savings Account (Traditional, Roth, SEP)
1.45*%--Ally BankOnline Savings Account
Rates as of April 26, 2018.

Thanks to DA reader, Maecl , who posted on the new rate in the DA Forum.

My Take

Rate Competitiveness

Ally Bank is a little behind its competitors on raising the savings account rate. Big internet banks like Synchrony and Barclays have already raised their savings account yields to 1.50%. Several of the smaller internet banks now offer savings accounts with 1.60% APY, and the top savings account rate is now 1.70% APY at ableBanking.

In the last year, Ally has put more focus on rate competitiveness of its CDs rather than its savings account. For example, Ally’s 11-month No Penalty CD was often very competitive in the last year and provided an easy way for Ally customers to obtain yields higher than the top savings accounts at other internet banks. Today, the top-tier No Penalty CD rate isn’t much above the OSA rate. However, Ally’s 6-month and 12-month High Yield CD rates offer customers a way to get a significantly higher yield without a long term.

Another perk for Ally customers is Ally’s tradition of offering existing customers a 5-bps rate bonus when CDs are renewed. DA reader Cumulus described his useful CD strategy that uses this rate bonus to get higher rates on all of his Ally CDs in this DA forum post.

Other Nice Features

Another way Ally is competitive is the CD early withdrawal penalties (EWPs). Ally’s EWPs are smaller than most other internet banks for most terms. In addition, Ally makes it very easy to manage and close the CDs by logging into your account and using Ally’s online CD management software.

The online account management software is just one of many online features that Ally does better than many of the other internet banks. Ally’s bank-to-bank ACH transfer service is one example. It’s easy to link multiple external accounts for transfers. Ally allows large transfers to and from external accounts, and the transfers take place in one business day.

Deposit Growth at Ally Bank

One thing to keep in mind about Ally Bank is that it has grown big. It’s now the 19th largest bank by assets in the United States. I compared its deposit growth in the last year to the other banks with internet divisions, and Ally is way out in front. For example, Ally Bank has increased its total non-brokered deposits by $12.69 billion, resulting in 19.8% growth for the year. For that same period, Goldman Sachs Bank USA grew non-brokered deposits by 7.16%, Discover Bank grew them by 10.51% and Synchrony Bank grew them by 10.24%. In short, Ally Bank has been able to grow deposits dramatically without being overly aggressive on their rates.

FDIC Insurance for Over $250k

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. These features make it easy to maintain FDIC insurance on deposits in excess of $1 million. I described how this can be done in this blog post.

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

Availability

Headquartered in Midvale, Utah, Ally Bank is currently the 19th largest bank in the country, with assets in excess of $130 billion and over 2.6 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 an Ally account 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 2.08% (excellent) based on September 30, 2017 data. In the past year, Ally has increased its non-brokered deposits by $12.69 billion, an excellent annual growth rate of 19.8%. Please refer to our financial overview of Ally Bank for more details.

How the Online Savings Account Compares

When compared to the Personal Savings accounts and Money Market accounts tracked by DepositAccounts.com with similar balance requirements that are available nationwide, 11 banks have higher rates on savings accounts and 3 banks have higher rates on money market accounts than Ally Bank’s Online Savings Account rate.

The above rates are accurate as of 2/9/2018.

To review the best liquid account rates, both nationwide and state specific, please refer to our Savings Account Rates Table page and our Money Market Account Rates Table page.

Related Pages: Salt Lake City savings accounts, savings accounts, nationwide deals, Internet banks

Comments
Att
Att   |     |   Comment #1
"Day late and a dollar short". All America is paying 1.75% up to 50K. All America/ Redneck matches the 2017 Ally 11 Month no penalty rate.
HappyPanda
HappyPanda   |     |   Comment #2
Haha.. day late is right. I opened a Marcus Goldman Sachs online savings yesterday to move funds out of Ally.com. Goldman shows funding is complete. Ally still has the funds but that will update next Monday. I went over to Goldman because Ally was still 1.35% yesterday. But today it's 1.45%. I wouldn't have opened the Goldman account if I knew Ally was going to 1.45% today. day late indeed.
Att
Att   |     |   Comment #3
At least your getting a little more at Marcus (1.5%). All America/ Reneck bank is paying 1.75%.
HappyPanda
HappyPanda   |     |   Comment #4
Yeah, I'm considering moving some funds into All America after than month closes and the new rate becomes effective 2/21. All their account statements close on the 20th of each month. That's why they're new rate comes online on 2/21. A new month.
Matt
Matt   |     |   Comment #5
Ally needs to get with it. They are always weeks and months behind their competition. I'm sure they have lost many accounts because they are slow to up their rates.
Att
Att   |     |   Comment #7
Matt I thought Ally would be a leader when they offered the 1.75% 11 month CD with no penalty. We now have a savings rate that matches that. Looks like I will be closing those Ally CDs sooner rather than later.
DOA
DOA   |     |   Comment #8
As the old time Walmart Sam Walton once said: "Customers talk with their feet". I did some talking yesterday and walked into another store.
Reader
Reader   |     |   Comment #9
I talked to a CSR in early January who told me the response they had to the 2% 12 month CD and the 1.75% 11 month CD was overwhelming. I think they have grown their deposits so much that they don't care about being close to the rate leasers any longer. This will be the case until enough people decide to move their money elsewhere.
Reader
Reader   |     |   Comment #10
*leaders not leasers (no edit function!)
nelson
nelson   |     |   Comment #12
spell check was invented
Bogie
Bogie   |     |   Comment #11
People want high interest rates on their deposits and low interest rates on loans. A financial institutions, be it a bank or CU, can not accommodate both at the same time and continue to stay afloat.
Nothing
Nothing   |     |   Comment #13
Borrow from, e.g. Beverly Hills and lend in Miami or other growing areas. Build relationship banking. On and on...it can and has been done!
HappyPanda
HappyPanda   |     |   Comment #16
Yup. and blockchains and cryptocurrencies have arrived to eventually completely eliminate banks/CUs.
Att
Att   |     |   Comment #17
I refinanced my mortgage at a low rate. And now savings rates are going up. The trick is to try to lock the higher savings/CD rates at oe near rhe top and have a ladder.
Att
Att   |     |   Comment #15
I have already closed 2 -11 month Ally CDs to open an 18 month CD @ 2.30% and a 5 year at 3%. Still have a few more that if rates go up those CDs will be closed. So they have a lot of funds but these funds are very liquid.
Boop
Boop   |     |   Comment #18
Wasn't Ally the first large online bank with 2% on a 12 month CD?
Att
Att   |     |   Comment #19
#18 The rate was 2% now at 1.75% 5k minimum.
Att
Att   |     |   Comment #20
Sorry 2% with 25K minimum
#6 - This comment has been removed for violating our comment policy.
oofah
oofah   |     |   Comment #14
i would assume Ally will raise the no penalty CD rates soon because the 2 lower tier amounts are significantly lower than the savings account. there's virtually no advantage in the CD over the no penalty CD.... unless you think rates are going lower... and there's no way rates are going lower in the next 12 months.
acadapter
acadapter   |     |   Comment #21
Didn't Ally Bank came from bankruptcy company?
Anon
Anon   |     |   Comment #22
that was years ago..when they were called GMAC Bank.
acadapter
acadapter   |     |   Comment #23
Even though it was years ago, it still concerns me. It may not be stable or could fall again in the future.
Nothing
Nothing   |     |   Comment #24
Look and see if/how the business model changed..and comments on blogs. Other “spin offs” from old GM have very bad postings on it/them! And those spin offs do not seemingly care when those adverse comments are raised directly with reps.
acadapter
acadapter   |     |   Comment #25
What? are you saying that Ally is not good? I like that Ally has a interest checking and savings.
Nothing
Nothing   |     |   Comment #26
My 30 second search at only one site
https://www.consumeraffairs.com/finance/ally_bank.html
payitforward
payitforward   |     |   Comment #27
CIT just raised their 11-mo. no penalty CD to 1.85%. I was fortunate to get in on Ally's limited time special back in December on the 11-mo. NPCD, earning 1.75%. I hope Ally won't take too long to match or beat CIT's new rate.
AllySaver
AllySaver   |     |   Comment #28
Ally is a main advertiser on this very website. It amazes me that it keeps advertising its online savings rate of 1.45% and its 11 month no-penalty CD rate of 1.50% in big purple letters with a tagline of "save smarter", when its management can clearly see that both these rates are significantly lower than other banks (currently the highest rates are 1.80% for the savings account and 1.85% for the 11 month no-penalty CD). Ally should be competitive in its rates or customers like me will move their money elsewhere.
ooo
ooo   |     |   Comment #29
They wouldn't miss you or I money one single bit
Robert
Robert   |     |   Comment #30
I was just checking savings rates of other online banks. What happened to Alley's rates, still at 1.45% They use to be competitive and a leader in the industry.
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