Ally Bank Review 2023: An Online Bank With a Full Range of Services
- Tech-savvy customers
- Various savings goals
- No overdraft fees
Digital banking services have been around, and popular, for a while now. And since the pandemic, the number of users was expected to grow significantly, surpassing 200 million in 2022, about 75% of the US population.
While traditional brick-and-mortar banks expand their reach online, digital-only or e-banks have already been the way to go for millions of Americans. They offer online access to many of the account features and services consumers need and want.
Additionally, online savings accounts and checking accounts can save you money. Less overhead — after all, no physical buildings with maintenance and employees — can translate into lower monthly maintenance fees and higher interest rates for you.
For customers who don’t want to be tied to a physical location and want the freedom to bank from their mobile phone or device wherever they are, an online account is worth exploring.
If You’re Interested in Online Banks, Check Out Ally
Ally Bank is one such online-only financial institution. It’s actually been around for over a century, but you probably didn’t hear about its high-interest, online deposit accounts until the last decade.
Ally dominated the news in 2021 when it eliminated all overdraft fees for its accounts. Ally had put the fees on pause through the pandemic but then decided in June of that year to eliminate them permanently. Other banks and credit unions, like Alliant and Capital One, followed suit — but many loyal banking customers will remember that Ally was the trend-setter.
Our in-depth Ally Bank review paints a full picture of the institution, but specifically focuses on its checking and savings accounts. This review also includes information about Ally’s money market accounts, CDs (High Yield CD, Raise Your Rate CD and No Penalty CD), loans and investment options, as well as a review of Ally’s mobile app, level of convenience and customer service.
Ally Bank Review 2023
Below, we’ve summarized the specifics of both the checking and savings accounts at Ally, highlighting what we like and (though rare) what we don’t.
Ally Interest Checking Account
- No monthly maintenance fee
- No overdraft fees
- Moderate interest rate
Despite being called the Interest Checking account, Ally’s checking option offers a somewhat low interest rate: 0.10% on minimum daily balances below $15,000 and 0.25% on minimum daily balances above $15,000 — though we recommend keeping less in your low-yield checking accounts and more in a high-yield savings account.
That said, the Ally Bank checking account still offers a higher APY than many major players, both online and brick-and-mortar. Also notable: This account includes no minimum deposit or balance requirements, and there are no monthly fees or overdraft fees. The account comes with a free debit card and free checks.
Even better, Ally’s checking account can be linked to the online savings or money market account, automatically funding the account to accommodate your purchase if you would otherwise overdraft. It will do so in increments of $100. This perk, called overdraft transfer service, is optional and free of charge. And as of June 2021, Ally does not charge overdraft penalty fees.
Additionally, there is a secondary overdraft protection service called CoverDraft, which provides up to $250 in temporary relief for common transactions if you accidentally overspend. It provides basic coverage up to $100 and if you overspend and trigger an overdraft, your next deposit automatically applies to the negative balance. As opposed to pulling from a linked savings account, or having to get back to positive and pay an overdraft fee. Ally still offers these two overdraft protection services even though as of June 2021, Ally does not charge overdraft penalty fees.
Though Ally is an online bank, depositing checks and withdrawing cash is easy with free access to any of the 43,000 Allpoint ATMs worldwide. If you’re strapped for time and need to transact with an out-of-network ATM, Ally Bank will reimburse you up to $10/month for usage fees.
The Ally Bank Interest Checking account also includes easy mobile check deposit and money transfers via their online mobile app. You can learn more about online banking features here.
Ally Online Savings Account
- 3.30% APY
- No monthly maintenance fees
- Unique savings features
Ally Bank is one of the best options as far as savings accounts go, especially if you are comfortable with an online-only institution. Ally’s Online Savings program currently offers a massive 3.30% APY that compounds daily; that APY is 10x higher than the national average and is much better than what most traditional banks will offer.
Two other hallmarks of Ally’s Online Savings account: It carries no typical monthly fees and has no minimum balance requirements. Ally is transparent about the fees it does have, which include excessive transaction fees ($10/transaction) and outgoing domestic wires ($20; incoming wires are free), among a few others.
Ally also offers a few tools that make its Online Savings even more appealing:
- Savings Buckets: You can categorize your savings into up to 10 buckets for various savings goals, like a vacation, a wedding and a house down payment. No matter which bucket your funds sit in, they’ll still earn the same interest rate and coexist within your online savings account.
- Savings boosters: Ally offers three different kinds of “boosters” that are especially helpful for novice savers:
- The first is its recurring transfers: You can “set it and forget it” by setting up recurring transfers from your checking account, forcing you to routinely put money into savings.
- The second booster is Round Ups; if you have an Ally checking account, Ally will round up purchases to the nearest dollar and deposit the extra change into savings once it hits at least $5.
- And finally, there is Surprise Savings; Ally analyzes your checking account to identify “safe-to-save money” and transfers it from checking to your savings account for you.
A Note on Ally’s Money Market Account
If you’ve been wondering about money market accounts, Ally does offer a solution (3.30% APY). Money market accounts often offer a higher APY than a traditional savings account, but that’s not the case at Ally. However, the Ally Money Market Account at Ally also has low barriers for entry: no monthly maintenance fee and no minimum balance requirement.
Ally Bank Features
In addition to rating the checking and savings programs with Ally, we analyzed the bank’s overall convenience, mobile app and fees.
Convenience: Great Features, But Online Only
In an increasingly digital world, Ally Bank is highly convenient. It offers intuitive mobile check deposit and easy money transfer. The mobile app and website (more on that in a second) are both easy to use, and you can easily link savings and checking accounts to fund one another as necessary. The Allpoint network of ATMs is extensive and free to use.
Ally Bank’s one true detriment — and the detriment of all online-only banking institutions — is the lack of a brick-and-mortar location.
Though you can handle all your transactions and banking online with Ally, many customers still prefer physical locations for their sense of security and the feeling of in-person help. While COVID-19 ushered in a newfound acceptance of digital everything, many customers will likely still appreciate physical bank visits for years to come.
Mobile Banking: Ally Mobile App Review
As an online-only institution, Ally offers an intuitive website and highly rated mobile app, available for Windows, Apple and Android devices. You can use the website for a full range of services, but when you are on the go, the app should do just fine.
With the Ally Bank mobile app, you can:
- View account balances
- Use Ally Assist
- Transfer funds
- Manage one-time and recurring transfers
- Deposit checks via Ally eCheck Deposit
- Pay bills
- Send money with Zelle
- Find an ATM
At the time of writing, the Ally Mobile app has a 4.7-star rating on the App Store and a 3.8-star rating on Google Play Store (down 0.1 from our 2022 review). The app is free.
Ally Bank Account Fees
Ally Bank prides itself on its lack of monthly maintenance fees. In addition, Ally promises no fees for standard or expedited ACH transfers,overdraft item fees, incoming wires, postage-paid deposit envelopes or official/cashier’s checks.
However, Ally does have some fees and is transparent about those upon account signup. These fees include:
- Excessive transactions: $10 per transaction
- Expedited delivery: $15
- Outgoing domestic wires: $20
- Account research: $25 per hour
Other Ally Bank Products
All Bank offers a variety of other banking services in addition to the two core deposit accounts: a money market account, CDs (High Yield CD, Raise Your Rate CD and No Penalty CD), IRAs, auto and personal loans, mortgages, investment options (including a robo-advisor), and more.
You can find the full breadth of products on the Ally Bank website.
However, notably absent are small business banking options, save for the SEP-IRA.
Ally Bank Pros and Cons
Let’s weigh the pros and cons of this institution for you as a potential Ally Bank customer.
Pros
- Ally offers a higher annual percentage yield (APY) for savings accounts than the national average.
- There are no minimum balance requirements.
- There are no monthly fees.
- Ally prides itself on transparency regarding any (monthly) fees.
- There are no overdraft fees, as of June 2021.
- You get a free debit card.
- Access to Allpoint ATMs (and up to $10 reimbursement each month when accessing out-of-network ATMs).
- Ally offers a highly rated mobile app across all operating systems (Apple, Android, Windows).
Cons
- There are no physical branches.
- You cannot make cash deposits (since there’s nowhere to accept cash deposits), except at ATMs.
- Ally has a low APY for checking accounts, though many competitors offer no interest on checking accounts.
- There is a limit of six withdrawals and transfers from your savings per statement cycle. (There’s a $10 fee for additional transfers; other banks have moved to cover this fee.)
- There’s nothing attractive enough about the money market account over the savings account to justify it.
Frequently Asked Questions (FAQs) About Ally Bank
Still not sure if Ally Bank is right for you? We’ve analyzed our readers’ most common questions about the financial institution and provided as many answers as we could. See if we have the answers to your questions.
Ally is an online-only banking institution offering an array of personal finance services, beginning with its Online Savings and Interest Checking accounts.
Ally Financial’s portfolio includes:
- Ally Bank
- Ally Invest & Ally Forex
- Ally Home
Ally Lending, as well as Ally Corporate Finance, Ally Ventures and Ally Dealer Financial Services.
Ally Bank boasts a wide shelf of trophies, including best bank and best online bank awards from organizations such as MONEY Magazine and Kiplinger’s.
In addition to checking and savings accounts, you can open a money market account or open CDs with High Yield CD, Raise Your Rate CD and No Penalty CD options. Ally also offers competitive home and auto loans (with a history in the automotive business), multiple IRAs and various investment options. You can even utilize a robo-advisor for investing through Ally.
Ally lacks small business banking options.
The bank started out in 1919 as GMAC, General Motors’ finance division. But in 2009, the company rebranded as Ally Financial, Inc., a leading digital financial services organization that offers everything from savings and checking accounts to home and auto loans to investment accounts. Ally Financial remains the parent organization to this day.
Yes. Ally is FDIC-insured. The FDIC (Federal Deposit Insurance Corporation) is a government agency that protects your account as soon as you open it. The FDIC protects your Ally deposits up to $250,000 per depositor — for instance, if you and your spouse each had an individual account, you’d be insured for $500K total.
Ally and Chime continue to be among our top most recommended financial institutions. If you are just starting your personal finance journey, Chime is a great choice. Ally Bank is more suitable for those with more established savings. We do currently rate Ally a half a star better than Chime.
Though it does not have physical branch locations, Ally Bank is a legitimate bank. It is one of the leading online banks in the country.
Yes, your Ally account will come with a debit card.
Is Ally Bank Right for You?
Ally Bank is one of the top choices if you are open to the idea of switching to an online bank. The institution offers a full suite of products, so you can move all your banking needs there, or just open one or two accounts and keep other accounts with your current bank or credit union.
Ally Bank might be a good fit if:
- You’re looking for a high-interest savings account.
- You have various savings goals that you need help organizing.
- You’re comfortable with mobile check deposits.
- You have fallen prey to overdraft fees in the past.
- You’re tech-savvy.
- You’d like a bank with a full suite of products, including loans and investments.
Ally Bank might not be a good fit if:
- You prefer to do your banking in-person at physical branches.
- You need small business banking.
- You make cash deposits regularly.
If you’re wondering how it compares to other online banks — like determining which is better, Chime or Ally, for example — you’ll have to take inventory of your banking needs. Ally offers an interest-bearing checking and joint accounts, while Chime doesn’t. However, the simplicity the latter offers might match up with what you want.
It boils down to what you’re looking for in an online bank account.
Timothy Moore and Kathleen Garvin are veteran writers on personal finance topics and frequently contribute to The Penny Hoarder. Freelancer Dennis Lynch contributed to this post.
