Ally Online Savings Rate Increase

[div]

Wealthfront Cash is offering 1.40% APY:
https://www.wealthfront.com/cash

[atdharris]

Amex is still behind everyone. I expect Marcus/Ally will bump their rates this week after the 0.75% rate hike last week. It will be interesting to see how much the rates are bumped.

[Cheez-It Guy]

Marcus moved HYSA to 1.00% as of this morning.

[OpenMinded1]

CIBC Online Agility Savings Account is 1.27%.

[jpsfranks]

The 7-day yield for several money market funds now exceed 1%.

Vanguard Cash Reserves Federal Money Market (VMRXX) - 1.22%
Fidelity Money Market (SPRXX) - 1.06%
Fidelity Premium Money Market (FZDXX) - 1.18%

I can't remember the last time I saw money market fund yields competitive/exceeding high yield savings accounts. Pre-2008 I think?

[atdharris]

I assume these HYSA banks will keep raising deposit rates, but maybe I'm wrong. I did expect a bit more of a hike from Marcus today given we had a 75bp Fed hike.

[drg02b]

Boom, Ally just bumped to 1.00% effective 6/24 (you'll see it on 6/25).

Still thinking of moving money to Vanguard brokerage, since VMFXX settlement fund's 30 day SEC yield is 1.35%.

[Jack FFR1846]

Just got an email that Ally's going to 1%.

So I went to look at Redneck's splash page and sure enough, they responded with a baseball bat to Ally's head. 1.35%.

[anon_investor]

Boom, Ally just bumped to 1.00% effective 6/24 (you'll see it on 6/25).

Still thinking of moving money to Vanguard brokerage, since VMFXX settlement fund's 30 day SEC yield is 1.35%.

I think VMFXX will move up faster, I am considering moving some money there as well.

[Rainmaker41]

Count me in the Vanguard money market fund club. I like Ally, but beyond a bit of cash in savings there for contingencies we're now using Vanguard & Treasury Bills for most of our cash reserve.

[crg11]

Count me in the Vanguard money market fund club. I like Ally, but beyond a bit of cash in savings there for contingencies we're now using Vanguard & Treasury Bills for most of our cash reserve.

Yup, in an effort to simplify, I just moved everything I had at Ally to Vanguard.

[martyboyle]

Sofi's 1.25% looking less enticing now. Was planning to move everything there.

[feh]

Count me in the Vanguard money market fund club. I like Ally, but beyond a bit of cash in savings there for contingencies we're now using Vanguard & Treasury Bills for most of our cash reserve.

Yup, in an effort to simplify, I just moved everything I had at Ally to Vanguard.

Question for those that watch these things closely - how often does the Fido/Vanguard money market return more than an online savings account?

I have a fair amount of cash in online savings, but I don't want to put it in a money market just to move it back a couple months later.

[Kevin M]

Count me in the Vanguard money market fund club. I like Ally, but beyond a bit of cash in savings there for contingencies we're now using Vanguard & Treasury Bills for most of our cash reserve.

Yup, in an effort to simplify, I just moved everything I had at Ally to Vanguard.

Question for those that watch these things closely - how often does the Fido/Vanguard money market return more than an online savings account?

I have a fair amount of cash in online savings, but I don't want to put it in a money market just to move it back a couple months later.

It changes over time. Why don't you want to transfer it back a couple months later? It takes a couple of minutes to put in the sell order to transfer it back to your bank.

[feh]

Count me in the Vanguard money market fund club. I like Ally, but beyond a bit of cash in savings there for contingencies we're now using Vanguard & Treasury Bills for most of our cash reserve.

Yup, in an effort to simplify, I just moved everything I had at Ally to Vanguard.

Question for those that watch these things closely - how often does the Fido/Vanguard money market return more than an online savings account?

I have a fair amount of cash in online savings, but I don't want to put it in a money market just to move it back a couple months later.

It changes over time. Why don't you want to transfer it back a couple months later? It takes a couple of minutes to put in the sell order to transfer it back to your bank.

The hassle factor, and the payoff. Due to transfer limits, it would take days to move all of it, and we're talking about what.... .1% or .2% difference in interest.

[Kevin M]

Count me in the Vanguard money market fund club. I like Ally, but beyond a bit of cash in savings there for contingencies we're now using Vanguard & Treasury Bills for most of our cash reserve.

Yup, in an effort to simplify, I just moved everything I had at Ally to Vanguard.

Question for those that watch these things closely - how often does the Fido/Vanguard money market return more than an online savings account?

I have a fair amount of cash in online savings, but I don't want to put it in a money market just to move it back a couple months later.

It changes over time. Why don't you want to transfer it back a couple months later? It takes a couple of minutes to put in the sell order to transfer it back to your bank.

The hassle factor, and the payoff. Due to transfer limits, it would take days to move all of it, and we're talking about what.... .1% or .2% difference in interest.

Transfer limits should not come into play, since you initiate all transfers at Vanguard, and in my experience the bank ACH limits do not apply. To move money from bank to Vanguard, you initiate the fund shares buy at Vanguard, specifying your bank as the source of cash, and to transfer to bank, you sell shares at Vanguard, specifying bank as destination for cash. Takes 1-2 business days for the transfer to complete.

Ally rate: 1.00%
VMFXX yield: 1.36% as of yesterday
My TEY: 1.49%

So after factoring in taxes, the fund yield is 49 basis points higher (not 10 or 20). Up to you if it's worth it.

EDIT: Earlier this morning I initiated transfers from two banks to VMFXX, moving most of my remaining cash out of the banks. Took a couple of minutes, and would have taken less time if I didn't have to log on to the banks to check balances. APY at one of the banks is only 0.6%, and the other was Ally at 1%.

Kevin

[skip22]

Barclays (Savings) is still "only" showing 0.9% when I log into my account, but their homepage (https://www.banking.barclaysus.com/online-savings.html) is showing 1.1%, so assume/ hope my account will show that higher rate any time now.

[LadyGeek]

I removed an off-topic interchange comparing performance to VTI (Vanguard Total Stock Market ETF). The discussion was derailed.

Please stay on-topic, which is focused on Ally's saving rate.

[Candor]

In case anyone is interested their no penalty CD is also at 1%.

[anon_investor]

Anyone disappointed that Ally only went to 1%? With te last jump from 0.7% to 0.9%, I was hoping for a jump to 1.1%. VMFXX is looking pretty good at 1.36% (some of that will likely be exempt from state income tax too.

[Blues]

Like Kevin, I've been moving our assets out of Ally over the past several weeks...and into Treasuries and brokered CDs through Vanguard.

As of today, we have one CD remaining which is not worth breaking...(nine months remaining on the five year term)...and a few dollars in a money market just to keep it open.

Nice to consolidate as well, which will eventually make things easier for the missus assuming the usual outcome.

[Kevin M]

Don't get me wrong--I love Ally as my main bank. I pay all of my bills from there, use ATM, bill pay, Zelle, etc. Due to high ACH limits, free incoming wires, no fees, ATM reimbursements, and all the other nice features, I consider it my "hub" bank.

Also, be sure not to move money to Vanguard that you might need to take out of Vanguard in less than 7-10 days, since they put a hold on your money. You can trade with it, but you can't transfer it out of Vanguard until they release the hold.

Kevin

[anon_investor]

Don't get me wrong--I love Ally as my main bank. I pay all of my bills from there, use ATM, bill pay, Zelle, etc. Due to high ACH limits, free incoming wires, no fees, ATM reimbursements, and all the other nice features, I consider it my "hub" bank.

Also, be sure not to move money to Vanguard that you might need to take out of Vanguard in less than 7-10 days, since they put a hold on your money. You can trade with it, but you can't transfer it out of Vanguard until they release the hold.

Kevin

Yeah, Ally is my "hub" bank as well. I usually keep 2-3 months of expenses at Ally Bank (I keep another 9+ months of expenses in I Bonds). I may just keep 1 month of expenses at Ally Bank now and move 1-2 months of expenses VMFXX at Vanguard since it is paying 0.36% more interest.

[Blues]

Don't get me wrong--I love Ally as my main bank. I pay all of my bills from there, use ATM, bill pay, Zelle, etc. Due to high ACH limits, free incoming wires, no fees, ATM reimbursements, and all the other nice features, I consider it my "hub" bank.

Also, be sure not to move money to Vanguard that you might need to take out of Vanguard in less than 7-10 days, since they put a hold on your money. You can trade with it, but you can't transfer it out of Vanguard until they release the hold.

Kevin

Understood. I also have had a good relationship with Ally for several years. That said, we use a brick and mortar bank in the small town I live outside of for free checking and bill paying. I've been with them since we decided to purchase a home here 19 years ago and have never regretted maintaining that relationship. In fact, they sent me an email today reminding me that it was our "anniversary" with the bank and thanking us for our patronage.

(In any case, this isn't our first rodeo. )

[Kevin M]

Don't get me wrong--I love Ally as my main bank. I pay all of my bills from there, use ATM, bill pay, Zelle, etc. Due to high ACH limits, free incoming wires, no fees, ATM reimbursements, and all the other nice features, I consider it my "hub" bank.

Also, be sure not to move money to Vanguard that you might need to take out of Vanguard in less than 7-10 days, since they put a hold on your money. You can trade with it, but you can't transfer it out of Vanguard until they release the hold.

Kevin

Understood. I also have had a good relationship with Ally for several years. That said, we use a brick and mortar bank in the small town I live outside of for free checking and bill paying. I've been with them since we decided to purchase a home here 19 years ago and have never regretted maintaining that relationship. In fact, they sent me an email today reminding me that it was our "anniversary" with the bank and thanking us for our patronage.

(In any case, this isn't our first rodeo. )

I also have accounts at a few local banks and credit unions for specific purposes (e.g., safe deposit box, signature guarantees, etc.), but I don't use them for anything that Ally does (and might do better), which is most everything that I don't use the local bank or CU for. Certainly none of them offer as good a savings rate as Ally (one used to offer a much higher rate, which is why I opened that account, but it no longer does).

At Ally, I keep more in savings than in checking, and schedule a few transfers from savings to checking each month to cover the bills. Ally overdraft kicks in if I mess up, and pulls the required amount from savings into checking. So Ally increasing its savings rate still benefits me some.

Kevin