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Ally’s New Online Banking Helps with CD Management and Wire Transfers


Ally Bank announced yesterday new online banking features that help customers manage their CDs and request wire transfers. In addition, Ally added several online bill pay features, extended the length of time to view statements and tax forms online to seven years and made improvements in the online account application process. An overview of the enhancements is listed in Ally Bank’s press release.

Online CD Management

I gave Ally’s online CD management a test today. After you log into your account, select "Manage CDs" in the main menu to get to the CD management page. You’ll see three main options: renewal, interest disbursement and early withdrawal.

The renewal options allow you to select what happens to your CD when it matures. What I like best about this option is that you can select to have the CD closed at maturity with either a check sent to you or the CD funds transferred to another account. I consider this an important feature since it’s easy to forget the maturity date of a CD. If you miss the grace period, you then can’t get access to the CD without an early withdrawal penalty.

One downside with the renewal option is that it doesn’t allow customers to change renewal options until one year before maturity. It does allow you to set up an alert to notify you by email when renewal options become available online.

Unlike the renewal option, interest disbursement option is always available to CD customers. You’re given the choice of interest being paid monthly, quarterly, semi-annually or annually (at the end of the year). You can choose to have interest paid back into the CD, transferred to one of your accounts or sent by check.

The early withdrawal option wasn’t mentioned in the press release. As the name suggests, the option allows you to close any of your CDs early (with an early withdrawal penalty). For a selected CD, it lists the amount of early withdrawal penalty. I checked the amount with the two CDs that I have, and the amounts were correct. My CDs were opened before Ally increased the early withdrawal penalties, and the old penalties are still in effect for my CDs. For CDs opened or renewed after the change, the new penalties will be in effect. The early withdrawal option allows you to choose to have a check mailed to you or to have the funds transferred to one of your accounts. Note, Ally does not allow partial early closure which means you can’t request an early withdrawal of only some of the principal.

Online Wire Transfer Requests

Another new online banking feature that many savers may use is requesting wire transfers. You no longer have to access a fax machine to initiate a wire transfer. To access this option, select "Transfer Funds" in the main menu. That will take you to the Transfer Funds page. Wire transfers is the last option on this page. When you select "Wire Transfers", the page describes two ways to wire money from your Ally account. The old way of printing out and faxing the wire transfer form is still available. The new online way can be done by selecting the link "wire transfer request". This brings up the wire transfer form. When you select the source account, it will allow you to enter the amount, the date of the transfer and the destination information. Note, Ally doesn’t allow international wire transfers. Also, there’s a $20 fee for outgoing wire transfers.

My Take

I’m happy to see these changes at Ally Bank. According to the press release "Ally Bank is one of the first banks to provide extensive CD self-service functionality and visibility into renewal instructions." I haven’t seen many internet banks that have this service. The one exception is Capital One 360 (formerly ING Direct) which has long had the online CD management capability. In my opinion, online CD management has several advantages over managing a CD by contacting a CSR. For example, I have seen a case at a different internet bank when a CSR wrongly assumed a request to close a CD at maturity was a request to close the CD immediately with an early withdrawal penalty. Being able to visually review CD management options and selections online will reduce mistakes and unpleasant surprises.

Related Pages: Ally Bank

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  |     |   Comment #1
Does the ability to close a CD through online manipulation include closing a no-penalty CD?  Or must that still be done by contacting a customer service rep?
  |     |   Comment #2
The type of CD you are closing or opening online is irrelevant.
  |     |   Comment #3
I'm a little worried about the online wire transfer.  If a bad guy gets your login password, they can wire themselves your money.  I guess that's also true with popmoney, but that has limits and is under ach rules.
  |     |   Comment #4
Does Ally allow the interest on a CD to be deposited into the existing CD on a monthly basis?
I tried to use the manage CD format and it would not allow me to select the same account
It gave me options to deposit  monthly only into one of the savings accounts (Money Mkt, etc).
  |     |   Comment #5
Default   choice
interest to CD
  |     |   Comment #6
This is only my best understanding.  I actually hope this is in error.  Here goes:

Yes, you certainly can have interest folded back into the CD.  But, no, not on a monthly basis.  I'm pretty sure compounding on my own Ally CDs is yearly, and that is the most frequent option available.

Obviously it is best to compound using the shortest allowed interval.  If anyone has monthly or even quarterly compounding on an Ally CD, please post.  
  |     |   Comment #8
on all CDs, interest is compounded Daily
credited Monthly
Cashed out at Maturity
unless you opt to get it paid to you by check, ect.
  |     |   Comment #9
monthly during the term
  |     |   Comment #7
I'm a many-year account holder at Ally and I've just looked at its new CD management option. I believe it should be a great help to those of us who frequently change and/or renew our CD's.  However, I could not find any way online to open a new CD as a POD (Payable on Death) account and provide the listing of beneficiaries.  I hope I'm wrong, but it looks like I'll have to do the old-fashioned thing and call a rep to get that done.  If anybody finds that I'm wrong, please post the info so we will all will get updated. 
  |     |   Comment #10
I find Ally to be non competitive with other banks. I would say the same for Penfed.
  |     |   Comment #11
Once you open a CD or other account, you can make it POD or In Trust For (ITF).  From the main menu click on 'Account Services'  and then click on 'Beneficiaries'

If you put more than one beneficiary on a CD, they will all get the same percentage.  I'm not sure, but I think you can designate unequal percentages if you call customer services.

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