Ally Bank Review: Ally Bank (2020 Guide with Customer Reviews)
Ally Bank Review: Ally Bank is an online-only bank offering competitive deposit accounts and other financial services. Ally’s roots go back to 1919 when it started out as GMAC, the finance arm of automaker GM. The bank rebranded in 2009 as Ally Bank, a straight-talking online bank.
Ally Bank is a popular online bank among people seeking strong interest rates and real customer service. The bank doesn’t have to put money into physical branches. So, Ally is able to offer better rates and fees than brick-and-mortar institutions and offer higher interest rates on its products. Ally Bank’s online-only business model allows it to pass on the savings to its customers in the form of high interest rates. The bank offers strong customer service and is ideal for people who don’t care about having branch access for their banking.
Ally Bank Review – Pros
- No monthly maintenance fees or minimum balances.
- Access to over 43,000 free ATMs via checking or money market accounts.
- An above-average 1.50% APY on savings. Relatively high rates on savings accounts and CDs
Ally Bank Review – Cons
- No way to deposit cash.
- For its savings account, Ally charges $10 for every outbound transfer after the sixth one in a month.
- No brick-and-mortar locations
What Does Ally Bank Offer?
Ally Bank offers a broad lineup of financial services. You can open a variety of bank accounts for everyday use and longer-term savings.
- Online savings account
- Money market account
- Interest checking account
- Certificates of deposit
Ally Bank Online Savings Account
Ally’s savings account offers a rate of 1.60%. This is higher than the national average of 0.07%, and interest is compounded daily. This means you’ll make a bit more money on interest compared to accounts that compound monthly. There’s a limit of six free outbound transfers per month, which is pretty standard. Also, the bank charges $10 for every transfer above and beyond the first six.
Ally’s Online Savings Account pays a relatively high annual percentage yield (APY) on deposits. APY is a reflection of the compounded interest rate based on the frequency of compounding. It has these other features:
- As of Feb. 13, 2020, earn 1.60% APY, regardless of your account balance.
- There’s no minimum initial deposit or ongoing minimum balance required.
- Fund your account a variety of ways – By transferring money from another account, mailing checks for deposit, wiring funds, or making a mobile check deposit.
- There are no monthly fees.
Ally Bank Interest Checking Account
Ally offers an interest-bearing checking account with solid rates, low fees and free access to over 43,000 ATMs nationwide. The bank will also reimburse you up to $10 per statement cycle for any fees you’re charged using an out-of-network ATM in the U.S. Ally doesn’t accept cash deposits. Your options include mobile check deposit, setting up direct deposit, setting up a wire transfer or sending a check by mail.
Interest Checking Features
Ally’s Interest Checking Account is free and pays a modest return on your cash.
- Earn 0.10% on balances of less than $15,000.
- Earn 0.50% on balances of $15,000 or more.
- Pay no monthly maintenance fees.
- Send instant and secure payments to friends and family with Zelle.
- Deposit checks to your account with the mobile app.4
This is an excellent option for everyday spending. You earn interest on your account balance, you can easily pay bills online, and you get a debit card for cash withdrawals and everyday spending. (Source: thebalance.com)
COVID-19 relief update: On April 17, 2020, Ally Bank forgave customers’ negative balances. This means that those receiving a relief payment can use the entire amount, rather than having some diverted to repay an overdraft. “The credit provided does not have to be paid back,” according to a press release from the bank. (Source: nerdwalley.com)
Ally Bank CD
Ally has a variety of CDs, including what it calls High-Yield CDs and No-penalty CDs. These are traditional CDs that require you to commit to leaving funds with the bank for a specific length of time. As a result, they may pay higher rates at issue than some of the more flexible options. The rate stays the same, for better or worse, until maturity. Also, there is no minimum deposit required to get started. That’s somewhat unusual for CDs. Many banks require a minimum of at least $500. Ally’s no minimum makes these CDs a great option for anyone who just has a small amount to invest.
Ally’s Raise Your Rate CD that lets you bump up your APY once or twice, depending on the term length, to the rate currently on offer for new CDs. The no-penalty CD offers no early withdrawal penalty for those who may need the money sooner.
Raise Your Rate CDs
Ally Raise Your Rate CDs have rates that can potentially go up, preventing a situation where you get stuck with a low CD rate for several years. If Ally raises rates on the product you own, you can log in and ask for your rate to increase. With a 2-year CD, you have one opportunity during the term to request an increase. With 4-year CDs, you have two opportunities. The ability to switch to a higher rate is somewhat rare. Although there may be a few similar products out there, Ally Bank’s Raise Your Rate CD is among the best. As of Feb. 13, 2020, the APY for both 2-year and 4-year Raise Your Rate CDs is 2.05%, and there is no minimum deposit required.
No Penalty CDs
Ally No Penalty CDs are liquid CDs that address the primary drawback of using a CD. Most require you to commit to leaving your money in the account for a set amount of time. But life brings surprises, and you may need to cash out early. You might even want to cash out to take advantage of higher interest rates on newly available CDs.
No Penalty CDs at Ally Bank are 11-month CDs, but you can withdraw 100% of your money after the first six days. As of Feb. 13, 2020, you can earn:
- 1.65% on deposits of less than $5,000 (no minimum deposit required)
- 1.85% on deposits between $5,000 and $24,999
- 1.90% on deposits of $25,000 or more (Source: thebalance.com)
Money Market Account
This account is a hybrid of checking and savings accounts: You earn interest, but you can spend your money instantly.
- As of Feb. 13, 2020, earn 0.75% APY, regardless of balance.
- Get a debit card and free checks for spending your money.
- Pay no monthly maintenance fees.
- Enjoy the same ATM access as the Ally Checking Account.
Ally Bank Review – Overall Banking Experience
Overall, Ally’s bank experience scores very well in customer reviews. In general, the rrating takes a hit largely because of the bank’s lack of branches.
Ally Bank ATM Availability
Ally’s ATM setup is decent, too. You can withdraw cash at any Allpoint ATM for free. (Allpoint ATMs are located at convenience stores, restaurants, and financial institutions.) And you can receive up to $10 per statement cycle in ATM fee rebate charges from other U.S. ATMs. Ally Bank does not charge you an ATM fee for using non-network ATMs, but the ATM operator may impose a fee. And Ally does charge you a 1% foreign transaction fee when you get cash outside of the U.S. You can use the Ally website to find Allpoint ATMs near you.But remember that there are no Ally branches, so you may need to plan for occasional transactions that require a money order. You can buy those at other locations such as the post office or a grocery store. And if you value face-to-face service, you’re better off looking elsewhere. (Source: thebalance.com)
Ease Of Use
Lots of people still value a human relationship when it comes to banking but scores of others balk at even walking into a branch. Ally Bank makes it easy for the latter, relying on technology to amp up the convenience factor. In addition to enabling customers to remotely make deposits via their mobile phone’s camera, Ally Financial has created a skill for Alexa, Amazon.com’s voice-activated digital assistant.
That means customers with an Alexa enabled device can use voice commands to check balances on their checking, savings, money market, and CD accounts, transfer money, hear recent transactions and get the current rates on its products. Still, crave some human intervention? Ally Bank has 24/7 customers service support via phone or live chat that is staffed with real human beings.
For people who don’t need the human touch and are looking for a decent return on their savings, Ally Bank makes a lot of sense. If you have a lot of complex needs, want to deal with people face to face and aren’t comfortable with technology then this online-only bank isn’t for you. (Source: forbes.com)
Ally Bank’s Customer Service
Ally Bank earns high marks for customer service, taking second place in the 2019 J.D. Power 2019 Direct Banking Satisfaction Study. There are a number of ways to get your questions answered — by phone, email, snail mail, or chat. Ally’s help center will likely answer many frequently asked questions. Ally’s apps, both on iOS and Android, have garnered decent ratings from users.
Customers particularly like Ally’s account opening experience, as well as the products and fee structure. What’s more, Ally Bank offers phone support 24/7, and you can see your estimated wait time before calling (so you can decide if it’s the right time to call or not). If you prefer typing, you can chat with customer service representatives 24/7. Customers logged in online or using the Ally Bank app can send secure messages and chat about account-specific issues. (Source: thebalance.com)
Creating an Account
Signing up for an Ally Bank account is easy. You do have to provide information about your identity, including your Social Security number. You are also required to answer questions that all banks have to ask as a result of the PATRIOT Act. However, it’s relatively painless, and it’s possible to open a variety of accounts. This includes CDs and checking accounts, from the same screen, without the need to fill out the same information over and over again.
Ally charges a $25 overdraft fee, but customers can’t rack up more than one of those per day. Although the bank has a free overdraft transfer service for linked Ally accounts as an alternative, it doesn’t offer an overdraft line of credit. You won’t be able to escape fees entirely at Ally, but at least the bank clearly highlights what you’ll owe for certain services and transactions. That kind of transparency isn’t always so easy to come by with banks. (Source: nerdwallet.com)
Other Financial Products From Ally Bank
Ally Bank is competitive with other offerings, but it’s always good to shop around. The best choice might depend on how much you have to invest and what other products you want from a bank, if any. Ally Bank offers a robust range of offerings besides bank accounts:
- Auto loans
- Home purchase loans
- Mortgage refinance loans
- Self-directed investment accounts
- Managed investment portfolios
Who Is Ally Bank Best For?
Ally Bank should appeal to most consumers looking for a solid online bank account. You want the best combination of high interest rates, low fees, and no minimums. Ally is very near the top of the heap on interest rates across the board. Of course, nothing is stopping you from chasing the very highest rate you can find, but the trade-off for that rate is often higher fees and high account minimums. If you’ve got a lot of money to stash, that might not be a concern, but for the average Joe, it’s a good compromise. It may be a particularly good fit for customers who want to:
- Earn a competitive return on savings
- Open a savings account with no minimum balance requirement
- Open a checking account that comes with a debit card and no monthly maintenance fees
- Earn more on their cash with CDs that require no minimum deposit
- Bank with an established, well-known online bank (Source: thebalance.com)
Who Might Want to Skip Ally?
Of course, there are also a couple of situations where Ally might fall short:
- You want a one-stop shop: If you prefer to keep most or all of your financial dealings with one bank, Ally might not be the best option for you. It lacks several relatively common products, including mortgages, small-business accounts, and brokerage accounts. If this kind of variety is important to you, you’ll probably need a brick-and-mortar bank; if you want to stay with an online bank, Capital One 360 would be worth a look.
- You want to build a personal relationship with a bank: For all of its plusses, there is one thing Ally (and all online-only banks) can’t offer: the chance for you to be more than a number. While its customer service availability is as good as it gets for an online bank, some customers may find comfort in the facetime they can get at their community bank branch. These relationships may come in handy when you’re in a bind, and one common customer complaint about online banks is that problems can take a long time to get resolved.
- You need your money fast: Funds availability may be the Achilles heel of all online banks. While Ally isn’t the slowest online bank when it comes to transferring your money and making deposits available, it still generates plenty of complaints from customers who say holds were extended beyond what was promised, sometimes without explanation. (Source: thesimpledollar.com)
Ally Bank Reviews from Customers
Ally Bank Review: 5-Star***** Exceptional online bank…
While chasing rates and moving money around, I have encountered some really annoying and inept financial institutions. Among those where I have made a speedy exit are Discover, Alliant, CIT, Investors Bank, and Goldman Sacs (Marcus). In sharp contrast is Ally Bank, where I have had favorable experiences with customer service, ACH transfers, website organization, access to Wire Transfers, and per-day withdraw limitations. I don’t put up with lousy service, unfair limitations, or having to jump through hoops.
You don’t always know what will happen when you sign up for a new account but you can always vote with your feet. Being very pleased with Ally Bank, I plan on staying. Note too that Ally has 2-step authentication (a code is sent to your phone) when the computer accessing your account is unrecognized. In my opinion, this is extremely important with all the cyber theft currently plaguing the internet. Be sure to backup all your financial data should the unthinkable happen.
Ally Bank Review: 4-Star**** Savings Interest Rates No Longer Competitive…
Their other services and products (low minimum balances, free check printing, free ACH transfers, etc.) is the only reason I have stayed with them. I have opened accounts with other banks to take advantage of their higher interest rates on savings accounts. It would be nice if I could keep it all in Ally, but I can’t afford to lose out on the higher interest offered by other banks.
Ally Bank Review: 4-Star**** Their 6-Day-Holds Are Killing Me…
I’ve been a customer for MANY years, with never a problem. However, lately I’ve been noticing that it takes longer and longer for transfers to clear, even internally. I’m not sure why, if Ally has received a transfer from your external checking account into your Ally savings account, and applied their 6 day hold, that if you want to transfer it internally, like from an Ally savings account to a money market account, or to AllyInvest, they impose another 6 day hold. Between that and the no-longer-great interest rates, they’re no longer one of my favorite banks.
Ally Bank Review: 3-Star*** Why Do People Rate This Bank As High As They Do?
I’ve been reading about Ally for a long time now. It is hard to find a website dedicated to online banking which doesn’t rate Ally highly. After finally opening an account at Ally, the only apparent reason for the high ratings is Ally pays for positive reviews. Let’s be clear: there are some really bad banks out there. Ally isn’t one of them, but is also doesn’t rise above the level of mediocrity. My first warning sign was that Ally can’t even give customers statement cycles which run from the first of the month to the last of the month. I was given a choice of five days on which a statement cycle could end. That was after calling in. The default date I was assigned was the 13th, which seemed like a really bad omen…
Ally Bank Review – The Bottom Line
The Good – Ally Bank is a solid option for anybody that wants free online banking. Interest rates aren’t always the highest. But Ally Bank is competitive, so you can earn a decent return without putting effort into chasing rates and switching accounts frequently. With 24/7 customer service and a well-designed site that explains almost everything, you know what to expect with Ally Bank – or you can get the answer easily.
The Not-So-Good – The main weak point is the money market account. It actually pays less than Ally’s savings account and less than other banks’ money markets. If you need a high money market rate, it may make sense to look elsewhere. Alternatively, you can keep the bulk of your money in Ally’s savings account or a liquid CD—and transfer money to checking or the money market when you need it.
The reason most people decide to go with Ally is that it offers relatively high interest rates. Savings accounts and CDs are the big draws. Additionally, it helps that Ally Bank doesn’t charge monthly maintenance fees, and there are no minimums on accounts. With many banks requiring minimums and charging fees, this is a nice departure from other online banks. It’s also important to note that Ally is FDIC-insured. Those protections apply up to $250,000 per depositor. This is great for peace of mind, especially because all of your banking will be done on the internet. (Source: investorjunkie.com)