Ally Bank savings interest rate dropping from 0.8% to 0.6%

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anon_investor
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Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by anon_investor »

As anticipated, I just got an email from Ally Bank announcing their savings interest rate will be dropping from 0.8% to 0.6% effective 9/25/2020... now matching Macus which also recently dropped down to 0.6%.

Adding the relevant text from the email:
"...we’re writing to let you know that the Annual Percentage Yield (APY) for your Online Savings Account is changing from 0.80% APY to 0.60% APY on all balance tiers. Your new APY is effective 9/25/2020 and will show online in your account details on 9/26/2020."
The Ally No Penalty CD is still listed at 0.75% (as of 2:30pm ET 9/24), I bet that rate drops by tomorrow, so better lock while you can...
https://www.ally.com/bank/no-penalty-cd/
Last edited by anon_investor on Thu Sep 24, 2020 1:31 pm, edited 1 time in total.
atdharris
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by atdharris »

anon_investor wrote: Thu Sep 24, 2020 1:25 pm As anticipated, I just got an email from Ally Bank announcing their savings interest rate will be dropping from 0.8% to 0.6% effective 9/25/2020... now matching Macus which also recently dropped down to 0.6%.

Adding the relevant text from the email:
"...we’re writing to let you know that the Annual Percentage Yield (APY) for your Online Savings Account is changing from 0.80% APY to 0.60% APY on all balance tiers. Your new APY is effective 9/25/2020 and will show online in your account details on 9/26/2020."
Interesting. I have yet to get that email, but either way it was going to happen. I wonder how low these will go?
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anon_investor
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by anon_investor »

atdharris wrote: Thu Sep 24, 2020 1:29 pm
anon_investor wrote: Thu Sep 24, 2020 1:25 pm As anticipated, I just got an email from Ally Bank announcing their savings interest rate will be dropping from 0.8% to 0.6% effective 9/25/2020... now matching Macus which also recently dropped down to 0.6%.

Adding the relevant text from the email:
"...we’re writing to let you know that the Annual Percentage Yield (APY) for your Online Savings Account is changing from 0.80% APY to 0.60% APY on all balance tiers. Your new APY is effective 9/25/2020 and will show online in your account details on 9/26/2020."
Interesting. I have yet to get that email, but either way it was going to happen. I wonder how low these will go?
This is lower than online banks went during the GFC. The no penalty CD is still at 0.75%.
atdharris
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by atdharris »

anon_investor wrote: Thu Sep 24, 2020 1:30 pm
atdharris wrote: Thu Sep 24, 2020 1:29 pm
anon_investor wrote: Thu Sep 24, 2020 1:25 pm As anticipated, I just got an email from Ally Bank announcing their savings interest rate will be dropping from 0.8% to 0.6% effective 9/25/2020... now matching Macus which also recently dropped down to 0.6%.

Adding the relevant text from the email:
"...we’re writing to let you know that the Annual Percentage Yield (APY) for your Online Savings Account is changing from 0.80% APY to 0.60% APY on all balance tiers. Your new APY is effective 9/25/2020 and will show online in your account details on 9/26/2020."
Interesting. I have yet to get that email, but either way it was going to happen. I wonder how low these will go?
This is lower than online banks went during the GFC. The no penalty CD is still at 0.75%.
I put most of my cash into a NP CD at 1% a bit ago. I am wondering if it is even worth holding ~$10k at Ally now for $60/year.
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sapphire96
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by sapphire96 »

Wow, how low can it go? Mediocre environment for savers.

What’s worse is that we can expect this environment for at least a couple of years as the Fed plans to keep its interest rates at 0% for that time.

What does not make sense is that I remember Ally offering almost 1% on their savings account when the Fed interest rates are at zero before they were raising rates a few years ago. Do I dare ask why is it different this time?
Keep interest as your friend, not your foe. | Use money as a tool for bettering your life, not squandering it. | Stay the course, don’t deviate from it.
atdharris
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by atdharris »

sapphire96 wrote: Thu Sep 24, 2020 1:33 pm Wow, how low can it go? Mediocre environment for savers.

What’s worse is that we can expect this environment for at least a couple of years as the Fed plans to keep its interest rates at 0% for that time.

What does not make sense is that I remember Ally offering almost 1% on their savings account when the Fed interest rates are at zero before they were raising rates a few years ago. Do I dare ask why is it different this time?
Perhaps they are wanting to be more conservative during this economic downturn? I believe it dropped to 0.75% during the GFC and start moving up as the Fed began raising rates. So that pretty much means we're going to be at 0.6% or lower until 2023. Maybe we really do have no choice but to invest in equities.
theplayer11
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by theplayer11 »

just transferred to CD at .75%
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anon_investor
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by anon_investor »

theplayer11 wrote: Thu Sep 24, 2020 1:43 pm just transferred to CD at .75%
Yeah, I just opened up 4 unfunded No Penalty CDs at 0.75%.
tibbitts
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by tibbitts »

atdharris wrote: Thu Sep 24, 2020 1:32 pm
anon_investor wrote: Thu Sep 24, 2020 1:30 pm
atdharris wrote: Thu Sep 24, 2020 1:29 pm
anon_investor wrote: Thu Sep 24, 2020 1:25 pm As anticipated, I just got an email from Ally Bank announcing their savings interest rate will be dropping from 0.8% to 0.6% effective 9/25/2020... now matching Macus which also recently dropped down to 0.6%.

Adding the relevant text from the email:
"...we’re writing to let you know that the Annual Percentage Yield (APY) for your Online Savings Account is changing from 0.80% APY to 0.60% APY on all balance tiers. Your new APY is effective 9/25/2020 and will show online in your account details on 9/26/2020."
Interesting. I have yet to get that email, but either way it was going to happen. I wonder how low these will go?
This is lower than online banks went during the GFC. The no penalty CD is still at 0.75%.
I put most of my cash into a NP CD at 1% a bit ago. I am wondering if it is even worth holding ~$10k at Ally now for $60/year.
As opposed to doing what with it?
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auntie
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by auntie »

Thanks, I just opened another no penalty CD with my loose change. When will it end?
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shess
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by shess »

sapphire96 wrote: Thu Sep 24, 2020 1:33 pm What does not make sense is that I remember Ally offering almost 1% on their savings account when the Fed interest rates are at zero before they were raising rates a few years ago. Do I dare ask why is it different this time?
My theory is that some banks can just borrow their cash needs on the money markets, so don't bother too much with offering good yields to attract individual deposits. Some banks either have to pay more to borrow (maybe Ally, being a repackaged GMAC), or they can make direct use of deposits (Discover bank lending to Discover card holders), so they offer some of that margin to savers to attract funds. Of course, this latter case is how banks are _supposed_ to work :-).

Anyhow, what this makes me wonder is if either the money markets are just _too_ cheap to pass up, so Ally/Discover/others just can't afford to pony up yield for what is effectively marketing. Or, worse, what if the part where they make their margin simply isn't working? Like what if people are reining in their debt spending, or what if card vendors are reining in their limits to reduce their risk exposure? Either way, less need for deposits to fund those loans.

Unfortunately, there's a bit of There Is No Alternative, here. I could hold cash, but I have to hold that cash somewhere, might as well hold it somewhere that pays slightly more than my other options. I could eventually shift it back to the brick-and-mortar bank I used previously, who had great in-person customer service ... but also had obvious ideas about getting my money into places where they could play with it and extract fees, and I'd rather not deal with someone who operates that way.
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by Lastrun »

tibbitts wrote: Thu Sep 24, 2020 2:04 pm As opposed to doing what with it?
+1 I am all ears.

Everything as safe is basically at zero. SHV, BIL, VGSH, Prime, Federal, etc.
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by sergio »

tibbitts wrote: Thu Sep 24, 2020 2:04 pm As opposed to doing what with it?
I had a huge super conservative emergency fund and when rates dropped to 1% I took half of it and put it towards my mortgage (15 year @ 3.25%), still leaving enough for 4-6 months expenses. Once I get my mortgage down to half of my emergency fund, i'll take half of my emergency fund and just pay off the mortgage - estimated to be next spring. I used to be against paying off the mortgage early when savings rates were 2% and CDs were 3% but not in the current environment (and will likely get worse). Cash is becoming trash.
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by batpot »

I-bonds are still 1.06% through October.
stoptothink
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by stoptothink »

When it went to 1% I cleaned out our cash EF almost completely to pay off the mortgage, now it is just a holding spot so we can max out Roths and 529s the first of every year. More to VTSAX.
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by 6bquick »

stoptothink wrote: Thu Sep 24, 2020 2:53 pm When it went to 1% I cleaned out our cash EF almost completely to pay off the mortgage, now it is just a holding spot so we can max out Roths and 529s the first of every year. More to VTSAX.
Honest question, why the 1% cutoff? it was at 1.25% for a bit IIRC, why not then? anything sub 3% is historically worse than inflation, just curious as to the rationale in the timing of your move.
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by MathIsMyWayr »

What is the downside of converting most of the savings account to a number of no penalty CDs? Can I still make transactions at Vangurd directly from CD or do I have sell CD and put the proceeds to savings first?
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by stoptothink »

6bquick wrote: Thu Sep 24, 2020 2:56 pm
stoptothink wrote: Thu Sep 24, 2020 2:53 pm When it went to 1% I cleaned out our cash EF almost completely to pay off the mortgage, now it is just a holding spot so we can max out Roths and 529s the first of every year. More to VTSAX.
Honest question, why the 1% cutoff? it was at 1.25% for a bit IIRC, why not then? anything sub 3% is historically worse than inflation, just curious as to the rationale in the timing of your move.
Just happened to be the point where we had enough in there to pay it off, there was nothing special about that 1% threshold. The lower HYS rates go, the less I feel I need sitting their in a cash "emergency fund".
6bquick
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by 6bquick »

stoptothink wrote: Thu Sep 24, 2020 3:00 pm
6bquick wrote: Thu Sep 24, 2020 2:56 pm
stoptothink wrote: Thu Sep 24, 2020 2:53 pm When it went to 1% I cleaned out our cash EF almost completely to pay off the mortgage, now it is just a holding spot so we can max out Roths and 529s the first of every year. More to VTSAX.
Honest question, why the 1% cutoff? it was at 1.25% for a bit IIRC, why not then? anything sub 3% is historically worse than inflation, just curious as to the rationale in the timing of your move.
Just happened to be the point where we had enough in there to pay it off, there was nothing special about that 1% threshold. The lower HYS rates go, the less I feel I need sitting their in a cash "emergency fund".
:thumbsup
Gnirk
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by Gnirk »

I received the same email about an hour ago. While I'm glad they keep us informed, I wish they would give us more notice.
sycamore
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by sycamore »

FWIW, Capital One 360 Performance Savings is at 0.65%. No email notification.

I lost track of when it dropped last. I'm expecting further drops...
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by SmileyFace »

Surprising Synchrony Bank is still at 0.75% but I am guessing they will be down to 0.6 or 0.65 by next week.
TheDDC
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by TheDDC »

Holding cash is increasingly more pointless. Not worth holding unless you you can get over 3% in a fixed investment vehicle anymore.

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Frankieg48336
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by Frankieg48336 »

I liked willthrills or maybe it was vines idea to use something like VASIX lifestrategy fund for 2nd tier EF funds 80% in bonds. I am at a sweet spot tax impact wise
atdharris
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by atdharris »

Lastrun wrote: Thu Sep 24, 2020 2:08 pm
tibbitts wrote: Thu Sep 24, 2020 2:04 pm As opposed to doing what with it?
+1 I am all ears.

Everything as safe is basically at zero. SHV, BIL, VGSH, Prime, Federal, etc.
I wish I knew the answer to that question. I suppose I need to be OK with making little to nothing on my cash. As much as I want to dump it into VTI or a VTI/BND blend, I know that is reckless.
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sapphire96
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by sapphire96 »

batpot wrote: Thu Sep 24, 2020 2:44 pm I-bonds are still 1.06% through October.
I am considering taking most of my Ally emergency fund and putting a few hundred dollars a month of it into iBonds, doing a ladder approach. Some of my Ally savings is in a 1.85% No-Penalty CD which I will hold until term next year.
Keep interest as your friend, not your foe. | Use money as a tool for bettering your life, not squandering it. | Stay the course, don’t deviate from it.
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by anon_investor »

Gnirk wrote: Thu Sep 24, 2020 3:02 pm I received the same email about an hour ago. While I'm glad they keep us informed, I wish they would give us more notice.
At least this time the no penalty CDs were not lowered first, so there is an opportunity to shift to 0.75% no penalty CDs now before the drop. The last time, Ally had already lowered the no penalty CDs to 0.75% when the rate dropped to 0.8%. Unfortunately (or fortunately), I only have a small amount I can shift to no penalty CDs now, as I already started shifting funds to no penalty CDs as the rates have been dropping, the only money I have left over now is literally just spare change as I have for the most part just been putting extra money into my taxable account.
batpot wrote: Thu Sep 24, 2020 2:44 pm I-bonds are still 1.06% through October.
I am really glad I purchased my 2020 limit of I Bonds when the fixed rate was 0.2%. I think the math works out that I am getting 1.74% over the first 12 months for my I Bonds purchased in April.

I am planning to shift the bulk of my emergency fund to I Bonds, except for may be 1-3 months worth of expenses, over the next few years. Using no penalty CDs worked out well for me when interest rates were over 2%. I have a bunch of no penalty CDs earning 1.85% that will expire in February, those will all go to I Bonds. That will leave me with no penalty CDs earning between 0.75% to 1.35%.
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anon_investor
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by anon_investor »

sapphire96 wrote: Thu Sep 24, 2020 3:39 pm
batpot wrote: Thu Sep 24, 2020 2:44 pm I-bonds are still 1.06% through October.
I am considering taking most of my Ally emergency fund and putting a few hundred dollars a month of it into iBonds, doing a ladder approach. Some of my Ally savings is in a 1.85% No-Penalty CD which I will hold until term next year.
Why are you laddering? Are you concerned about the 1 year required holding period for I Bonds?
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by MathIsMyWayr »

stoptothink wrote: Thu Sep 24, 2020 3:00 pm
6bquick wrote: Thu Sep 24, 2020 2:56 pm
stoptothink wrote: Thu Sep 24, 2020 2:53 pm When it went to 1% I cleaned out our cash EF almost completely to pay off the mortgage, now it is just a holding spot so we can max out Roths and 529s the first of every year. More to VTSAX.
Honest question, why the 1% cutoff? it was at 1.25% for a bit IIRC, why not then? anything sub 3% is historically worse than inflation, just curious as to the rationale in the timing of your move.
Just happened to be the point where we had enough in there to pay it off, there was nothing special about that 1% threshold. The lower HYS rates go, the less I feel I need sitting their in a cash "emergency fund".
CPI is currently 1.3%. At a 1/3 tax rate, I am losing about 0.9% per year at Ally savings: (1-1/3)*0.6%-1.3%=-0.9%. The true cost of a 2.5% mortgage is 2.5-1.3=1.2% without an itemized deduction. Actually, CPI does not matter. We have to compare (1-1/3)*0.6%=0.4% against the mortgage interest rate of 2.5%. I am losing 2.1% at Ally savings compared to adding to the mortgage payment.
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sapphire96
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by sapphire96 »

anon_investor wrote: Thu Sep 24, 2020 3:42 pm
sapphire96 wrote: Thu Sep 24, 2020 3:39 pm
batpot wrote: Thu Sep 24, 2020 2:44 pm I-bonds are still 1.06% through October.
I am considering taking most of my Ally emergency fund and putting a few hundred dollars a month of it into iBonds, doing a ladder approach. Some of my Ally savings is in a 1.85% No-Penalty CD which I will hold until term next year.
Why are you laddering? Are you concerned about the 1 year required holding period for I Bonds?
Yep, reading my mind!
Keep interest as your friend, not your foe. | Use money as a tool for bettering your life, not squandering it. | Stay the course, don’t deviate from it.
knightrider
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by knightrider »

What is the alternative? Put the money in a target retirement fund with Fidelity?
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by bugleheadd »

what about putting it in Total Bond Market BND for a 2.41% yield?
Osterix
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by Osterix »

The yield on an EF is insignificant. Sure, it was great to get a higher yield when available, but that’s just not the current environment. It is what it is.
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by Pushkin »

I swear my rate was 1.5% when I started with them.
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sapphire96
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by sapphire96 »

bugleheadd wrote: Thu Sep 24, 2020 4:10 pm what about putting it in Total Bond Market BND for a 2.41% yield?
Too much principal volatility for my liking for an emergency fund.
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sapphire96
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by sapphire96 »

Pushkin wrote: Thu Sep 24, 2020 4:14 pm I swear my rate was 1.5% when I started with them.
I started with Ally when their rate was 1% back in 2014. It rose to a high of 2.25% in 2017/18.
Keep interest as your friend, not your foe. | Use money as a tool for bettering your life, not squandering it. | Stay the course, don’t deviate from it.
RVdreamin
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by RVdreamin »

FYI, .75% no penalty CD is still available. I just wish I had done this during one of the previous rate drops (I locked in 1.9% on the majority of my EF early this year).
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CardinalRule
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by CardinalRule »

atdharris wrote: Thu Sep 24, 2020 1:29 pm
I wonder how low these will go?
Negative maybe? :annoyed I will refuse to pay the bank more than 0.001% to hold my money. :wink:
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kelway
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by kelway »

anon_investor wrote: Thu Sep 24, 2020 1:25 pm As anticipated, I just got an email from Ally Bank announcing their savings interest rate will be dropping from 0.8% to 0.6% effective 9/25/2020... now matching Macus which also recently dropped down to 0.6%.

Adding the relevant text from the email:
"...we’re writing to let you know that the Annual Percentage Yield (APY) for your Online Savings Account is changing from 0.80% APY to 0.60% APY on all balance tiers. Your new APY is effective 9/25/2020 and will show online in your account details on 9/26/2020."
The Ally No Penalty CD is still listed at 0.75% (as of 2:30pm ET 9/24), I bet that rate drops by tomorrow, so better lock while you can...
https://www.ally.com/bank/no-penalty-cd/
Thanks for the idea! Just did the necessary. I guess somehow you saved me $2.50 or so.
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by Grt2bOutdoors »

Nice....we are on our way to 0%. Those I bonds are looking better and better.
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by SchruteB&B »

CardinalRule wrote: Thu Sep 24, 2020 4:42 pm
atdharris wrote: Thu Sep 24, 2020 1:29 pm
I wonder how low these will go?
Negative maybe? :annoyed I will refuse to pay the bank more than 0.001% to hold my money. :wink:
Honestly, this is my line in the sand. I’m resigned to possibly earn 0 on my cash but I’m not paying a bank to hold it.
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by Grt2bOutdoors »

DaftInvestor wrote: Thu Sep 24, 2020 3:07 pm Surprising Synchrony Bank is still at 0.75% but I am guessing they will be down to 0.6 or 0.65 by next week.
Read an article that highlights a comment from Synchrony Bank management indicating they don’t need the funds due to reduced lending so no need to keep rates high, they actually want to shrink their balance sheet.
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by James2 »

Any idea if there is a setting to ensure you get the rate emails from Ally? I don't seem to get the emails, so I appreciate you guys posting the info in here :sharebeer
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by Lalamimi »

VIO is at 0.83%.
SchruteB&B
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by SchruteB&B »

James2 wrote: Thu Sep 24, 2020 5:25 pm Any idea if there is a setting to ensure you get the rate emails from Ally? I don't seem to get the emails, so I appreciate you guys posting the info in here :sharebeer
I don’t think so—I got this rate alert but last time I did not get an email. :confused
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by SmileyFace »

Grt2bOutdoors wrote: Thu Sep 24, 2020 5:23 pm
DaftInvestor wrote: Thu Sep 24, 2020 3:07 pm Surprising Synchrony Bank is still at 0.75% but I am guessing they will be down to 0.6 or 0.65 by next week.
Read an article that highlights a comment from Synchrony Bank management indicating they don’t need the funds due to reduced lending so no need to keep rates high, they actually want to shrink their balance sheet.
Then why do they have the highest rate (among the large online banks)?
Last edited by SmileyFace on Thu Sep 24, 2020 5:47 pm, edited 1 time in total.
cricket49
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by cricket49 »

Just opened a few No Penalty CD's @ .75

These rates keep dropping. 😡
Expect the best. Prepare for the worst.
UpperNwGuy
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by UpperNwGuy »

bugleheadd wrote: Thu Sep 24, 2020 4:10 pm what about putting it in Total Bond Market BND for a 2.41% yield?
BND has a 30-day SEC yield of 1.19%. Where are you getting your 2.41% figure from?
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AerialWombat
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by AerialWombat »

This is probably of little consequence to anybody else, but the TEY on Vanguard Intermediate-Term Tax Exempt is 1.5% for me, based on the current SEC yield. This fund is my single largest holding, and growing. I'll continue keeping about 2 years of personal expenses in Discover HYS and CDs, but I will continue adding to VWIUX.

I also recently started buying into a fund called Vanguard Total Stock Market Index (VTSAX) for the first time, in order to slightly increase my equity exposure, trying to get back up to 30% equities. Will take a few months to get there with new money, though.

That's my strategy for dealing with low cash yields.
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Kevin M
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Re: Ally Bank savings interest rate dropping from 0.8% to 0.6%

Post by Kevin M »

MathIsMyWayr wrote: Thu Sep 24, 2020 3:49 pm CPI is currently 1.3%. At a 1/3 tax rate, I am losing about 0.9% per year at Ally savings: (1-1/3)*0.6%-1.3%=-0.9%.
You are quoting the year over year change in CPI as of the August 2020 CPI release. This tells you nothing about the impact of inflation on what you are earning now. We don't even know the impact of inflation for September yet.

Kevin
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