Ally Online Savings Review [2023]: High Interest, No Minimum Balance

It’s no secret that online banks are disrupting the banking industry by offering higher interest rates on savings accounts. Does this mean traditional savings accounts have gone extinct? Of course not. But if you want your money to work harder for you — and who doesn’t — there’s a better way to earn interest with an online savings account.

An online high-yield savings account works the same way as traditional savings accounts, except that it typically offers a higher rate. In some cases, the interest rate is significantly higher than what your current account may be yielding at a brick-and-mortar bank. This may be something to keep in mind if you're saving up for something or you want to build an emergency fund.

In this review, we’ll go over how an Ally Online Savings Account can grow over time, fees you might incur along the way, and how to decide if Ally’s product is a good fit for you.

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Ally Online Savings Account basics

What we like about the Ally Online Savings Account

The biggest benefit of a high-yield savings account is undeniably the opportunity to earn higher than average interest. Luckily, that’s only the beginning of the amazing benefits you’ll receive with the Ally Online Savings Account.

• High APY: Ally offers an APY (annual percentage yield) that is higher than the national average and compounded daily, which can help your money work harder for you than at most traditional banks. While both types of savings accounts earn interest, the rate of return is almost always higher with the Online Savings Account.

• No minimum balance: There's no minimum account balance for your Online Savings Account, which makes getting started with savings a little bit easier for new savers.
• No minimum deposit requirement: There's also no minimum deposit requirement for your Ally Online Savings Account.

• No monthly maintenance fees: Having no monthly maintenance fees coupled with no minimum balance is a win-win as far as the best savings accounts go. The money you deposit into your Online Savings Account will truly be saved until you’re ready to withdraw it.

• Direct deposit option: You can save money each time you get paid by directing as much (or as little) of your paycheck as you’d like with Ally’s direct deposit. Setting up this automated way to save could help you grow your account at a faster pace.

• Banking on the go: With the Ally Bank mobile app, you’ll be able to manage your Ally bank account on the go. Using the app, you can transfer money in and out of the account and do your mobile banking from anywhere in the world. The mobile app is available for Android and iOS.

What the Ally Online Savings Account could improve

• No cash deposits: One drawback to consider for the Ally Online Savings Account is the inability to deposit cash into your account. With cash deposits becoming less popular, this may not be a big deal to you. But if you do routinely need to make cash deposits, you may want to consider opening an account that allows them.
• No physical locations: Lastly, if you prefer talking with someone face to face about your banking needs, an online bank may not be the right choice for you, as banks like Ally have no physical locations to visit. 

Ally Online Savings Account vs. traditional savings account

Decades ago, you would need to walk into several banks to learn the ins and outs of each before making a final decision. Now you can do so online in just a few minutes.

We did the research for you to see how Ally’s Online Savings Account compares to traditional banks. Here are some of the key similarities and differences:

• Ally charges no minimum balance fees and no monthly maintenance fees. These fees are relatively common at traditional banks, though fees and amounts will vary depending on which bank or credit union you choose. 
• The Ally Online Savings Account offers an APY of 3.60% (as of Mar. 22, 2023), while the average APY for a traditional savings account is just 0.37% (as of Mar. 23, 2023). You do not need to maintain a minimum daily balance on your Ally Online Savings Account to get a generous APY.
• Both the Ally Online Savings Account and traditional savings accounts allow you to make up to six withdrawals per billing cycle without incurring any fees. You'll be charged $10 per withdrawal for any additional withdrawals from your Ally Online Savings Account that you make in a billing cycle. Withdrawal fees at traditional banks will vary.   
• Many traditional banks offer physical branches that account holders can visit to do their banking in person, though the availability of and the total number of locations will vary from bank to bank. While Ally Interest Checking Account customers can withdraw money for free from over 43,000 Allpoint ATMs worldwide, Ally does not have physical branch locations.
• Ally Online Savings Account customers can withdraw money from their accounts via online transfer, wire transfer, check request, or telephone transfer. Typically, traditional banks offer those withdrawal options in addition to cash or ATM withdrawals as well. 

How to open an Ally Online Savings Account

The process of opening an Ally Online Savings Account is simple. Here's how:

1. Visit the Ally website and click 'Open a New Account.'

2. You'll then have the option to check whether you're an existing Ally Bank or Ally Invest customer or not.

3. Click 'Continue,' and then you'll be able to choose an account type, as well as view some basic information about the Ally Online Savings Account, Money Market Account, Interest Checking Account, and Certificates of Deposit Account.

4. Click on 'Ally Online Savings Account' and 'Add This Account.'

5. Ally will request some personal information from you, including confirmation that you are a legal U.S. resident, your name, address, date of birth, email, and occupation. 

6. Once you've added this information, you can submit your application, and someone from Ally will be in touch shortly after. 

How to withdraw money from your Ally Online Savings Account

You can withdraw money from your Ally Online Savings Account in the following ways:

• Online transfer
• Wire transfer
• Check request
• Telephone transfer

You will not receive a debit card or ATM card when you sign up for an Ally Online Savings Account, so you won't be able to make ATM withdrawals from your account. However, if you sign up for an Ally Interest Checking Account, you will receive an ATM card, and you can use it to make withdrawals at over 43,000 ATMs worldwide.

Other Ally Online Savings Account fees

Ally Bank is transparent about the fees that they do and don't charge their account holders. Here's what to expect in terms of fees with an Ally Online Savings Account:

Ally Bank customer service

Ally offers customer service assistance 24/7 with real humans through online chat and over the phone, and they pride themselves on short wait times. If you'd like to get in touch, you can call 1-877-247-2559 or click to open the online chat window when you're on the Ally Bank website. 

Common questions about Ally Bank

Final thoughts

The Ally Online Savings Account comes with some attractive features that set it apart from a traditional bank or credit union's savings account. Ally offers a higher-than-average APY for its savings account compared to a typical traditional savings account, making it a good option if one of your goals is to earn interest on the money you put away. Besides offering no monthly maintenance fees or minimum balance requirements with its Online Savings Account, Ally is very transparent about the fees it does charge so you always know what to expect. 

Overall, the Ally Online Savings Account is a solid option if you're comfortable with online banking and appreciate transparency, low fees, and the chance to earn a decent APY. However, if it doesn't sound like the best option for you, both the Aspiration Spend and Save Account and the Chime Savings Account may be worth considering and are often included on our list of best savings accounts. Both offer competitive interest rates and attractive features for account holders. ¹

Disclaimer: All rates and fees are accurate as of Jan. 9, 2023.

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Lauren Stewart Lauren Stewart is a freelance writer and personal coach. Get to know her!

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