"Ally Bank has one of the best high-interest savings accounts available at .60%. It's one of the few ways to make money in today's low-interest environment. Millennials and Gen Z will love this safe and fully secure online bank."
By: Allan R Kirby
Editorial Note: Mysmallbank.com does not earn a commission and will not accept compensation for the products or services mentioned in the article, this review is of our own opinion.
Saving in a low-interest environment
It is incredibly important to gain control of your finances by building a budget in order to reduce spending, cut debt, save money, and build wealth. However, it can be difficult to build on your savings account when the national average for interest rates on a savings account is just .05% APY. That's right, its basically nothing, now if you have a fee-based account or one with high minimum balance requirements, your money is literally doing nothing and over time will lose value.
So what can be done to help you make just a little bit of money? Especially for savings accounts that are used for emergencies, or if you're currently saving extra money for other things such as a down payment for a house, a new car, or even a trip? My suggestion is Ally Banks saving account.
Is it time to go Crazy for Ally!
I was recently asked a question on which bank had the best interest rate for a savings account. I did some research and come up with one bank that stood out over the rest, this was Ally Bank.
Ally Bank, is an online-only fully insured bank that provides customers of their savings account a .60% annual interest rate while the national average is only .05%. This is crazy but we love it! All the other banks pay an interest rate of almost zero but not Ally Bank. They are able to pay 1100% higher rate than the national average, that is not a typo. Yes in the end it's actually not a tremendous amount of money but Ally's savings rate will move the needle while .05% will do nothing.
Let's look at the Ally Savings account itself:
No monthly maintenance fees
No minimum balances.
Access to over 43,000 free ATMs.
A crazy 0.60% APY on savings.
However let's are honest, Ally Bank is not for everyone there are a few cons but if these are not deal-breakers then try Ally Bank.
No way to deposit cash.
No branches are available.
Our review of Ally Bank savings account
We at Mysmallbank.com embrace frugal living and we are always to find ways to help younger generations find ways to save money or to make a little more money than they do have. The Ally savings account is a great way to make a little money on your savings, it's not much but compared to most banks it's a lot better than nothing. Visit their website and see if this is the right savings account for you!
Let's be realistic about the Interest you will earn with an Ally Savings Account
If you deposit a $1,000 at .60% annual interest rate (*APR) year and leave the money in the account for the full year, the interest you would yield is $6 by the end of the year. I fully understand this is not much but at least you get a better idea of what you will receive. Plus with no fees, you are guaranteed to have that $6. Unlike many banks where you could have less than $1,000 if charge fees and give you interest of only .05%.
What is APY? It stands for annual percentage yield. Banks are basically required to display the rate customers will receive from their deposit kept in savings accounts. The APY gives you an accurate idea of what your money could earn in a year.
Some additional questions about Ally
How do you deposit cash with Ally Bank?
As mentioned in the article, Ally Bank does not accept cash deposits. They do not have branches to facilitate cash deposits and you cannot use an ATM either.
Is Ally Bank good for savings?
YES! With an Annual Percentage Rate of .60% Ally Bank has one of the best savings rates in the USA, better yet, there is no monthly fee and your money is safe, The FDIC protects your deposits up to $250,000 at Ally Bank.
Can you deposit cash at an ATM for Ally Bank?
Although you have access to over 43,000 ATMs when using Ally Bank, you still cannot deposit cash from one of those ATM's to an Ally Bank account.
We answer some of your questions:
Are online-only banks federally insured?
Yes, online banks, such as Ally Bank are still highly regulated and require to be insured. Online banks just like traditional brick-and-mortar banks are members of the Federal Deposit Insurance Corporation (FDIC). The FDIC protects your deposits up to $250,000 per depositor for each qualifying account ownership category. Ally Bank is a member of the Federal Deposit Insurance Corporation (FDIC).
Can you lose money in a high yield savings account?
It's true that some people are skeptical of high yield savings accounts, but there is no risk to the consumer. Additionally, so long as the amount of savings is 250,000 or less, this is because Ally Bank is a member of the Federal Deposit Insurance Corporation (FDIC). The FDIC protects your Ally Bank deposits up to $250,000 per depositor for each qualifying account ownership category.
This is a MySmallBank.com blog written by Allan Kirby, who writes and produces Personal Finance and Money Management articles and videos.
Please note: mysmallbank.com nor the author received any compensation for any products or services featured in this article.