Posted by Chuck on November 20, 2018
Checking Accounts

Published on November 20th, 2018 | by Chuck

62

Ally Bank Raise Savings Rate to 2.00% and No-Penalty CD to 2.25% [Update]

[Update 11/20/18: They’ve now raised the no-penalty CD to 2.25% (previously 2.20%). Updated below]

A lot of us did the Ally Payback promotion which offered up to $1,000 bonus for moving funds over to Ally, and have a large deposit with Ally. Good news is that Ally raised their rates:

  • Savings updated yesterday to 2.00% APY (up from 1.90%).
  • No-Penalty CD updated a couple of weeks ago to 2.25% APY (up from 2.10%).

My Ally savings already shows the updated 2.00% rate. For my no-penalty CD, I reached out to Ally chat to ask if they can upgrade my rate without breaking the CD. They replied they can’t do that, and I’d have to break the CD and open a new one to get the higher rate.

I then asked them if this will negatively affect my Ally Payback rate, and they replied that so long as the funds remain with Ally it won’t affect it at all. Just be sure to break the CD into your Ally checking or savings account and then open a new one at the higher rate, and it won’t affect your Payback rate since the funds remained the entire time with Ally. Others have gotten the same reply. You can chat on your own account to confirm this as a precaution if you’d like.

In related news, American Express savings also increased from 1.90% to 2.00% APY. Also, some people have a DCU account which offered 5.12% APY on your first $1,000; that rate has now been increased to 6.17%.

We’ve updated our resource: Best High Yield Savings Accounts – up to 5% APY to reflect all these changes.

(Thanks to the readers who shared these updates.)



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G
G

Discover savings raised to 2.00% days ago

Matt D.
Matt D.

With the AAII savings at 2.05% for Discover as well

Just a Note
Just a Note

And the AAII CD is 2.65% (for 1 year), so if you ladder a few of them it’s easy to stay ahead of others – not that I’d put a bunch of money there, but it’s a simple way to get the best rate on CDs.

Sam
Sam

It’s good to know that reallocating within Ally won’t impact the payback promotion.

I have 5 yr CD for 5k with Ally at 3%. It’s now at 3.1 APY. No big deal I guess.

Heritage bank is still 3.33%. If anything crosses that, then will think…

Yu
Yu

Hi Chuck,

What do you mean when you said ‘Just be sure to break the CD into your Ally checking or savings account ‘ ? Do you mean ‘close the existing 11-month CD and deposit it to the Ally Checking/Savings temporarily’?

Thanks.

JV
JV

Thats the way i read it. I guess a payout option might be to get a check or transfer to another bank which is what you want to avoid

Chris B
Chris B

Not worth opening a new CD for the 0.10% difference imo. If my calculations are right that’s only $8.33 a month if you parked 100k. And we need to keep the money only 2 or 3 months more.

anthonyjh21
anthonyjh21

It can’t take more than 10 minutes to do which is why I will do it. If this were Citibank then yeah no way I’d touch it. This should be relatively seamless given the fact that DoC already did the leg work for us.

arizonapv
arizonapv

I didn’t have a prior relationship with Ally, so for me to close the CD, well, where would I put the money without it leaving Ally? It doesn’t seem I could open a savings account, because then that would be a new account, wouldn’t it? Oh well, you can see that I’m not too clear on the process.

AD
AD

Are there any CHEX implications to opening new CDs?

Mikey
Mikey

It’s won’t be 3 months more, it’s exactly 1/16/19 for many of us.

Chris B
Chris B

Yes, so if its 2 month its only a $17 difference.

qmc
qmc

If we had guarantees there would be no issues with the payout, I’d do it, but I don’t feel confident enough at all to risk a hassle over $17.

Steve
Steve

Same

tolikfox
tolikfox

Amex raised to 2.00% as well

Jared
Jared

Capital One 360 Money Market accounts also went up to 2%.

Scott
Scott

And Chase is still at 0.01%

Novacat05
Novacat05

Why in the world people use big banks for savings accounts is beyond me. Talk about throwing away free money.

Security
Security

Ally is a big bank. Discover is a big bank. American Express is a big bank. All offer great rates at 2% plus.

Novacat05
Novacat05

I meant the traditional big 4 banks: Chase, Wells Fargo, BOA, Citi.

Dan
Dan

People can’t be bothered…

bax
bax

Where do you think our Chase banking bonus money comes from?

Jo
Jo

Just converted savings to no penalty CD

Todd
Todd

If you’re going to break the CD to reopen a new one, make sure you open the new CD first. You can open a CD without funding it immediately.

Ally’s fraud system can prevent new CD creation, even for existing customers. It sucks to have a chunk of change sitting at a lower savings account rate while waiting for them to open the new CD.

Radster
Radster

FYI: As below, I received conflicting information during an online chat session with an Ally representative. I believe I’ll forgo the additional ~$30 for the risk of loosing the bonus.

“If you had the savings account before the promotion and added new funds during the promotion, you can withdrawal funds out of the savings account, as long as you still have the new funds you added into the account until 1/15/19. You can remove previous funds you had, as long as the new funds stay.”

Dan
Dan

This is accurate…

The rep is saying: if you had 1k then added 20k you will get $200. You can still withdraw the 1k and get $200.

Mikey
Mikey

I assume everyone reads DoC and already had whatever funds they could stash at Ally for the promotion. Therefore, it wouldn’t make sense for Ally to raise rates for customers they already have who can’t move their money. The 2% isn’t a strongly competitive rate in terms of what’s out there in terms of luring new business. But those of us there anyway appreciate a few dollars more and will certainly take it.

Jeff
Jeff

Of course I just opened a 11 month CD two days ago and funded with $5k. Not worth the hassle to break CD and reopen for an extra .05% imo

more info
more info

Jeff, call them and within 10 days they can increase the yield on your CD. That’s a feature they have on some (maybe all) of their CDs. I’ve never did this so maybe I’m wrong.

PabloOzuna
PabloOzuna

Isn’t there a ten day rate guarantee on Ally CD’s?

Bobokins
Bobokins

Yes.

Bobokis
Bobokis

They have a 10 day guarantee that you receive the highest rate within that timeframe so you should automatically receive the higher rate.

David
David

Chatted with Ally online and they confirm there is no impact to the bonus amount if you close/re-open CD.
I then did this within 10 minutes, will get $40 more based on the CDs I have.

Darrell
Darrell

Just got this from Ally: as of 11/5/18, you’re on track to get a bonus of $1,000. To make sure you get the total amount, remember to maintain the funds you deposited through 1/15/19. And this: Funds must remain in an eligible Ally Bank Account (Online Savings, Money Market, Interest Checking or CD Account) through 1/15/19.
– Your cash bonus will be deposited by 2/15/19 and your account must be active and in good standing.
Be on the lookout for another note in January with your final bonus amount.
Not taking a chance moving it till at least 1/15. Better safe than sorry!

Chris B
Chris B

I agree!

calwatch
calwatch

Also, if you break a no penalty CD the interest will be credited to the present year. If you just let it roll until January you don’t have to realize the interest until then.

Churningaway
Churningaway

when are we going to start seeing 3%+ rates?

Darrell
Darrell

Fed will most likely raise rate 25 basis point in December. That will put the Fed Fund Rate at 2.50%. And they are predicting two more raises in 2019 (3%) and 2020 (3.5%). Interest rates will trace those levels maybe 25 to 50 basis points higher.

Derek
Derek

I opened an Ally Checking and Savings account while enrolling in the Payback bonus. When the Savings yields changed to 2.00%, I opened an Ally 2.20% No-Penalty CD and funded it with my Ally Savings.
Ally rep just said this new CD does not qualify for the Payback bonus because the CD account was not enrolled in the bonus.

Yu
Yu

You should ask the rep to check with his/her supervisor. Some rep has no clue how the bonus works. I am sure you will get a different and correct answer. Please report back what you get.

blue-paper
blue-paper

I messaged them today on chat and got this response
“It is correct that if money stays within Ally, in an account that was already open when the promotion started, or in an account that was open during the promotion, then it remains eligible for the Payback promotion. But if you open a new account, the new account is not eligible.”

Schmekel
Schmekel

I take that to mean this rep is stating that the bonus will be lost if new account opened and money deposited for the bonus is moved into the new account.

Seems to be enough confusion there that I may not open the new account.

Yu
Yu

This is different from what I got. I contacted Ally via SM and phone call, in both case they confirmed it’s OK to close and reopen CD as long as funds stay with Ally all time. They also put the notes in my profile. Now I have proof from secure message, notes in case needed in the future.

Bruce
Bruce

Yu

Good to know. I called and they told me the same as you. I asked them to make a note on my account.

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