For the past few years, the state of deposit interest rates has been nothing short of depressing. Month after month, I’ve been forced to update our best online savings account page by reducing interest rates for every single bank and in some cases, interest rates have declined by more than 80%. However, for the first time in a very, very long time, a bank has decided to increase their interest rate, as Ally was offering a 0.94% APY on their savings account and MMA products. But as of 1.17.12, Ally’s interest rate is 0.84%.
An increase of five points wasn’t going to make anyone rich, but it was a significant raise in rate considering how low online savings account interest rates are these days. For example, if I had $100,000 in my Ally account, the difference of five points would add around $50 to my yearly interest gains ($1090 earned, rather than $1040). The more money invested, the greater the return and vice versa but for most consumers, this change really won’t have an impact. What it does show is that Ally continues to push the envelope when it comes to online interest rates, even if it didn’t last.
Ally has also recently launched an IRA and 4 year raise your rate CD. These two new products are in addition to a large variety of other online deposit options and Ally is quickly becoming everyone’s favorite online banking institution. In fact, I decided to open up an Ally Bank account not to long ago and just received a deposit agreement pamphlet in the mail. The pamphlet informed me of rules regarding deposits and withdrawals as well as showed the current product offering as follows: