Sunday, October 1st
2023 Online Savings Account Reviews
Ally
- Savings APYs up to 3.75%
- CD APYs from 2% to 4.80%
- Money Market APYs at 4%
- Mobile app
- Commitment to social impact
- "A" rating from the BBB
Ally has been in business since 2004 and is a frontrunner in online-only banking. They offer a range of savings options including a savings account, three types of CD accounts, and a Money Market account.
No monthly fees or minimum balance
One of the standout features of Ally is that there are no monthly maintenance fees or minimum balances required for any of their accounts. The bank provides an above-average interest rate on savings, with an interest rate of 3.75%. The interest is compounded daily, meaning customers can make more money on interest compared to accounts that compound monthly. Ally customers also have access to over 43,000 free ATMs via the Ally money market accounts.
APY for tiers is unexplained
In terms of options for savings at Ally, the bank offers a single option for a standard savings account. This account offers APYs of 3.75% compounded daily. There are no fees associated with this account. However, qualifying for the 3.75% APYs is dependent on the balance in your account at the end of the day. There are three APY tiers at Ally:
- Less than $5,000
- Between $5,000 and $24,999.99
- $25,000 or more
The APY for each account balance tier may either remain constant or change, depending on the account's daily balance. However, on the savings account page, Ally doesn't disclose what APY will be offered at each tier, which isn't ideal.
Competitive APYs for CDs
If you're looking for CD-type accounts, there are 3 different options at Ally. Like the standard savings account, there is no minimum deposit requirement for any of these CDs. The options include:
- High Yield CD: APY ranges from 2% to 4.80% with the highest rates on an 18-month commitment.
- Raise Your Rate CD: APY is 3.75% across all options with choices for 2 or 4-year commitments.
- No Penalty CD: APY of 4.25% and a required commitment of 11 months.
4% APY for money market
Finally, customers can take advantage of Ally's Money Market Account, which earns a strong APY of 4% on any balance. The account provides customers with a debit card and the ability to write checks. There are also no associated fees or minimums with the Money Market account.
Claims to have competitive customer service
Since Ally Bank is online only, customers will not receive in-person service. However, Ally provides numerous ways to get customer service support, including phone, email, snail mail, chat, or Twitter. Additionally, Ally's thorough help center will likely answer many frequently asked questions. The bank's app, which is available on iOS and Android, gets mixed ratings, with a higher rating on iOS and fewer than 4 stars on Android.
Commitment to social impact
A standout feature at Ally is their promise to contribute to social issues, making this bank a great option for socially-conscious customers. The company is committed to creating a positive social impact on the world as part of its corporate responsibility. Environmental, social, and governance (ESG) issues are a priority for the company which serves to distinguish it from other companies, contributing to positive social impact and allowing stakeholders to understand what is significant to the company.
Customer confidence is low
In terms of customer feedback, Ally has an average of 2.5 stars across different third party review sites. Customers complained about a variety of services at Ally including having trouble with auto loans, CD account dispersal, and struggling to get a hold of customer service to resolve issues. Multiple reviews use the phrase "worst bank ever" which doesn't make us feel confident about this service. While the company does have an "A" rating from the BBB, it also only has a 1-star customer review average there.
Room for improvement
While Ally Bank has several competitive features, such as a range of savings and CD accounts with no minimum deposit requirements and a high APY of 4% for their Money Market account, the lack of transparency regarding the APY tiers and mixed customer reviews have led to a low rating for the bank. With customers complaining about multiple aspects of Ally, it's clear the company hasn't earned its clients' confidence. Furthermore, while the bank is committed to creating a positive social impact, this has not translated into positive customer experiences. Overall, these factors contribute to Ally Bank receiving a lower score in our evaluation.
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Where is the Best Place to Open an Online Savings Account?
Feeling let down by your current bank and looking to spruce up your finances? Or maybe you're about to open your very first savings account and want to make sure you're getting all the bells and whistles? Deciding who to trust with your savings is a big deal and it's crucial for your financial wellbeing. With so many banks and online institutions, it can be overwhelming to hunt for the best interest options or rewards. Switching banks, or opening a new savings account, can feel like a lot.
But first, some background: a savings account is a type of bank account that is specifically designed for saving money. It's an account that you can deposit money into and earn interest on the balance. Unlike a checking account, which is used for everyday transactions like paying bills or buying groceries, a savings account is intended for long-term saving.
Online Savings Account FAQ
Continued from above...
Many people use savings accounts to set aside money for things like a down payment on a house, a new car, or an emergency fund. One of the biggest benefits of a savings account is that it can help you build wealth over time. As you continue to save money, the interest earned on your balance can compound, meaning you earn interest on both the money you deposit and the interest you earn. Over time, this can add up significantly and help you achieve your financial goals. Additionally, savings accounts are generally considered to be low-risk investments, making them a great option for people who are risk-averse or new to investing.
Banks and financial institutions offer various types of savings accounts that cater to different needs and goals. Some common types of savings accounts include a basic savings account, which is a standard account that usually has a low minimum balance requirement and earns interest on the balance. High-yield savings accounts are another option. These typically offer a higher interest rate than basic savings accounts but may require a higher minimum balance in the account.
Money market accounts are similar to savings accounts but often offer higher interest rates and allow you to write a limited number of checks per month. Certificates of deposit (CDs) are time-bound accounts that require you to leave your money in the account for a fixed period in exchange for a higher interest rate. Individual Retirement Accounts (IRAs) are specialized accounts designed for retirement savings and offering tax benefits.
So, how do you find the best savings account for your needs? There are a lot of factors to consider for account types and which institution can offer you the best service overall. If you're not sure where to start, you can check out this list that should help you narrow down your options:
- Fees: While many online savings accounts offer accounts for no fees, there are just as many that do require minimums, or at least that customers meet a daily balance minimum to avoid fees. Keep in mind how much you're willing to pay each month (and what you need to do to keep an account free of charge) as you look over savings account options.
- Customer Service: Customer service is key, especially when your money is involved. Looking at feedback for customer service at different banks may help determine who you want to support your financial security.
- APYs: One of the biggest differences in savings account options is how much you'll make in APYs. Some APYs are fixed, while others depend on your account balance. Keep an eye on how much you'll be earning for your money when you choose your next savings account.
- Savings Options: General savings accounts aren't the only options to increase your savings. With CDs and Money Market accounts, many banks offer a variety of places to improve your savings. Knowing what kind of account you want will help you decide where to start banking next. Not all banks offer the same benefits or account types.
To make opening your next savings account as easy as 1, 2, 3, Top Consumer Reviews has evaluated and ranked the most popular options on the market. We hope this will help you decide which financial institution is the best place to keep track of your savings.
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