Ally’s new smart saving tools help you save automatically

Posted: 7 February 2020 4:28 pm
News

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The online bank has launched a new suite of tools to simplify the savings process.

Ally Bank is taking on the largest hindrance to saving money — besides not having money to save: willpower. On Wednesday, the online bank announced it launched a new suite of tools that will help automate the savings process. You can now split up your savings into multiple goals, set up monthly transfers into your savings or let Ally analyze your checking account — no matter which bank it’s at — and make smart transfers into your savings.

These tools premiered in the fourth quarter of 2019 but will now be made available to the public, and Ally is hoping they help draw in new customers. At a 1.6 percent APY, Ally is in the middle of the pack as far as high-yield savings accounts are concerned.

“We’ve all seen the statistics about how many Americans, if hit with a crisis, couldn’t come up with $400,” said Diane Morais, president of consumer and commercial banking products at Ally Bank, in the announcement. “People know they need to save, but they need real help. We went right to the heart of the problem, developing solutions and new tools that foster healthy and effective saving behaviors and inspire people to reach their near- and long-term financial goals.”

Details of Ally’s smart savings tools

  • Buckets: Savings buckets where customers can organize their savings according to their goals. A customer, for example, can set up buckets for “Christmas savings” or “Summer vacation,” making it easy to see at a glance how much has been saved up for various priorities. A customer can have up to 10 buckets on a single account.
  • Boosters: Automated transfers into the savings account from a checking account or other form of bank account. The source bank account does not need to be from Ally. Customers can either choose recurring transfers, which transfer a set amount each month, or “surprise savings.” “Surprise savings” analyzes the source bank account and determines — based on spending patterns and upcoming bills — if there are amounts under $100 that are safe to save. These amounts are automatically transferred. Ally will make no more than three “surprise savings” transfers per week.

Competition

Many of these features were previously offered by the bank under a different package. For example, it allowed customers to open multiple savings accounts and set nicknames for them. This is similar to what Barclays and Capital One offer. However, with Buckets, there’s no need to juggle through multiple savings accounts.

Ally is feeling confident about its new tools. “Early testing with real Ally customers shows that using just one of the boosters can accelerate savings by more than five times than interest rate alone,” said Anand Talwar, deposits and consumer strategy executive. “The ease of saving helps cement a new habit, and the feeling of success and momentum that comes from watching your money grow creates a snowball effect that keeps people going.”

Ally, however, may find that its new services have stiff competition from rivals. Marcus by Goldman Sachs allows for easy spending tracking, recurring deposits and personalized insights on savings while offering a higher APY (1.7 percent).

SmartyPiggy, which offers a 1.55 percent APY, allows for the setting of savings goals, permits friends and family to contribute to your savings and offers gift card purchases from participating merchants. Simple offers a 2.02 percent APY for daily balances over $2,000, the ability to pay bills and budget through an envelope system, photo check deposit and direct deposit.

“Americans need to rethink their savings strategies and foster new behaviors that fit the way we think and live now. Instead of placing the emphasis on sacrifice, guilt and depriving ourselves of the things we need and want, making saving personally and unexpectedly rewarding proves to be the most effective motivation for today’s consumers,” noted Ted Klontz, financial psychologist and associate professor of practice at Creighton University’s Financial Psychology Institute.

Image courtesy of Wikimedia.

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