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Ally vs. Simple Bank – Which Online Financial Institution Is Best for You?

Note: Simple is no longer accepting new applicants. Existing Simple accounts will transition to BBVA on May 8, 2021. Simple’s bank account and routing numbers will remain the same, and Simple debit cards will continue to work as before. See Simple’s account comparison guide for more details on the transition.

The list of institutions that can plausibly claim to be among America’s best online financial solutions seems to grow by the year. That makes the prospect of choosing the best fit all the more daunting.

That’s a good problem for consumers to have. But it’s still a problem — one that FDIC-insured financial institutions like Ally Bank and Simple both aim to solve.

Both Ally and Simple are fine online banking solutions that appeal to broad audiences seeking low fees. Their checking products rank among the best free checking accounts on the market today.

Both offer high-yield savings accounts and CDs with above-average yields. Ally has an excellent money market option as well. And both banks offer FDIC insurance on deposits up to the maximum allowed by law.

But there’s enough daylight between Ally Bank and Simple to warrant a detailed head-to-head comparison. Only you can decide which is the better choice for your financial needs.

Key Features

Ally Bank and Simple both have some important features worth noting: account opening bonuses for new customers, various deposit account types, and budgeting features designed to simplify money management.

Account Opening Bonuses

Ally Bank and Simple both offer bank account opening bonuses from time to time. These offers are usually time-limited and subject to change at the banks’ discretion, so check this page frequently for the latest information.

Ally Bank’s Account Opening Bonuses

Ally Invest, Ally Bank’s low-cost brokerage arm, has one of the best brokerage account promotions around right now.

Open a new self-directed account with Ally Invest by Sept. 30, 2021, and make a qualifying deposit of new money or assets to earn up to $3,000 bonus cash. The amount of your deposit determines how much you’re eligible to earn:

  • Earn $100: Deposit $10,000 to $24,999 in new funds or assets.
  • Earn $250: Deposit $25,000 to $99,999 in new funds or assets.
  • Earn $300: Deposit $100,000 to $249,999 in new funds or assets.
  • Earn $600: Deposit $250,000 to $499,999 in new funds or assets.
  • Earn $1,200: Deposit $500,000 to $999,999 in new funds or assets.
  • Earn $2,000: Deposit $1,000,000 to $1,999,999 in new funds or assets.
  • Earn $3,000: Deposit $2,000,000 or more in new funds or assets.

You must fund the account within 60 days of opening using funds deposited from non-Ally accounts. After Ally credits the bonus to the account, the combined deposit (less any trading losses) and bonus cash must remain in the account for 300 days. Otherwise, the bonus could be revoked.

This bonus is available to United States residents, excluding current Ally Invest account holders and Ally Invest account holders who closed their accounts within 90 days of applying.

Ally Invest also offers a transfer fee credit of up to $150. If your brokerage charges you to complete a first-time account transfer totaling $2,500, you receive the credit within 30 days of completing the transfer.

For more information about Ally Invest, read our Ally Invest review.

Simple’s Account Opening Bonuses

Simple has no active account opening bonus offers at the moment. Check back here for updates.

Available Account Types

Ally Bank and Simple have distinct account lineups. Ally Bank’s stable is more comprehensive, but Simple’s is undoubtedly adequate for daily money management needs.

Ally Bank’s Account Types

Ally Bank is a full-service bank with a complete lineup of account types: high-yield checking, savings, money markets, CDs, and brokerage accounts.

You can structure savings, CD, money market, and brokerage accounts as tax-advantaged retirement accounts (individual retirement accounts, or IRAs).

Traditional IRAs, Roth IRAs, simplified employee pension IRAs, and savings incentive match plans for employees IRAs are available, though not necessarily for all account types.

  • Interest Checking. Ally’s interest checking account has a two-tiered yield structure that handily beats traditional banks and exceeds many online banks as well. There’s no monthly maintenance fee, minimum deposit, or minimum balance. A low-cost overdraft protection option links to your Ally high-yield savings account.
  • High-Yield Savings. According to Ally Bank, the high-yield savings account’s yield beats the national average by many times, though the ratio is subject to change with prevailing yields. There’s no minimum balance requirement or monthly maintenance fee, and you can designate up to 10 savings “buckets” in the same account to meet discrete savings goals. Like all savings accounts bound by U.S. banking regulations, Ally’s online savings account limits withdrawals to six per month.
  • Money Market. Ally’s money market account has a very nice yield and comes with a convenient ATM card (if you want it). You can make as many ATM withdrawals as you’d like, plus up to six additional transactions per statement cycle. Ally doesn’t charge ATM fees at Allpoint ATMs.
  • CDs. Ally’s CD terms range from three months to five years. In addition to traditional CDs, which don’t allow penalty-free withdrawals during the term, Ally offers a 12-month no-penalty CD that does permit premature withdrawals. Ally’s Raise Your Rate CDs let you raise your certificate’s rate once or twice during the term, depending on term length, if interest rates rise.
  • Brokerage Account. Ally Invest is a very low-cost brokerage with self-directed and managed accounts. On the self-directed side, most transactions are commission-free: stocks priced above $2 per share, exchange-traded funds, and options. Mutual fund and bond trades are priced competitively. On the managed side, there’s no advisory fee — period — for the cash-enhanced option, which sets aside 30% of your portfolio in a high-yield savings account to protect against market volatility. The market-focused option invests the vast majority of your balance in the market, leaving a 2% cash cushion, and charges a 0.30% advisory fee (annualized as a percentage of assets under management). Both options offer a range of prebuilt portfolio options to choose from based on your risk tolerance and long-term objectives.

Simple’s Account Types

Simple’s account lineup includes checking and CD accounts.

  • Simple Checking Account & Debit Card. Balances held in Simple’s checking account earn nominal interest. But the account is convenient thanks to a Simple Visa debit card and seamless integrations with popular person-to-person money transfer apps like PayPal and Venmo (plus Simple’s own proprietary transfer feature, which lets you move money to payees with Simple accounts).
  • Simple Shared Account. Simple offers a solution for couples who’ve merged their finances.
  • Protected Goals Account. Open a Protected Goals Account — Simple’s high-yield checking account — to hold funds reserved for goals you expect to incur in the future. If you’re working with a shared account, you can share goals too. Transfer funds from your individual or joint checking accounts at will or set rules to automatically round up the change on everyday transactions and deposit the excess into your Protected Goals Account. Protected Goals Account yields can vary with prevailing rates but are comparable to Ally’s high-yield savings account yields.

Available Credit Products

Both Ally Bank and Simple have lending arms. Though Ally’s is more comprehensive, it overlooks a vital category — personal loans — that Simple is all too happy to cover for prequalified customers.

Ally Bank’s Credit Products

Ally Bank’s credit products include home and auto loans.

  • Home Purchase Loans. Ally Bank offers fixed-rate and adjustable-rate conventional and jumbo mortgages for homebuyers. The application process is entirely digital, with rapid preapproval and no in-person meetings required. Rates vary with prevailing benchmarks but are generally competitive with other national lenders.
  • Home Refinance Loans. Ally Bank also offers refinance loans for existing homeowners. If your current mortgage’s interest rate is significantly higher than prevailing rates today, you could be a strong refinance candidate. Ally’s home lending team is available to help make sense of the refinancing process, which is also entirely digital.
  • Auto Loans. Ally’s vehicle financing arm offers low-rate purchase loans for car buyers, along with a short-term option (called SmartLease) that blends the financial benefits of car ownership with the flexibility and appeal of leasing.

Simple’s Credit Products

Though it’s constantly changing and expanding its lineup, Simple offers just one credit product at the moment: an unsecured personal loan designed for debt consolidation.

Use one of these fixed-rate loans to roll multiple credit card bills into a single monthly payment that could help you pay them off faster. Enroll your Simple account in auto-pay to reduce your interest rate by 1% (100 basis points). Currently, this product is only available to prequalified Simple customers.

Budgeting Features

Both Ally Bank and Simple offer complimentary budgeting features that make it easy to stay on top of your money.

Pound for pound, Simple’s are more comprehensive and integrate better with its deposit products, making Simple a worthy alternative to standalone budgeting software.

Ally Bank’s Budgeting Features

Ally wraps its budgeting features into its mobile and desktop account interfaces. It’s easy enough to track recent and historical spending at a glance, and Ally offers personalized tips for maximizing yield (such as setting up recurring savings transfers of a specific size or laddering multiple CDs).

Ally doesn’t have much in the way of automated budgeting features or detailed, granular expense tracking and categorization, so it’s not an appropriate replacement for basic budgeting software.

Simple’s Budgeting Features

Simple’s budgeting features are more comprehensive and easy to automate, making Simple a suitable replacement for basic budgeting software (though it’s not quite as capable as paid platforms like Tiller or Personal Capital).

Simple’s main budgeting features include:

  • Expenses. You can designate any (and every) recurring bill or spending category as an expense and let Simple automatically set aside funds for it each month. Within the app, you can track your progress toward each one in real time. This feature helps ensure you’re taking care of the basics, such as food, housing, and utilities, before spending too much on nonnecessities.
  • Goals. Goals cover longer-term, one-time expenses like a vacation, down payment on a house, or new car. Funds allocated for your goals live in your Simple Checking Account and are not a part of your Safe-to-Spend balance, ensuring you don’t accidentally spend them. You can automate contributions in your checking account to your goals balance as frequently as you’d like.
  • Safe-to-Spend. Safe-to-Spend is an automated budget tracker that calculates how much of your Simple checking balance you can actually spend without getting into trouble. Your Safe-to-Spend balance is your total balance minus funds set aside for long-term goals and any expenses set to hit in the coming 30 days.
  • Analytics. Simple’s transaction activity reports and transaction search feature lets you drill down on potential threats to your budget, such as an overzealous takeout or online shopping habit.

The Verdict: Should You Bank With Ally Bank or Simple?

So, should you bank with Ally Bank or Simple? That depends on your needs, priorities, and (to some extent) personal preference. For example, Ally’s product lineup is a bit more comprehensive than Simple’s, but Simple’s budgeting tools are superior.

You Should Bank With Ally Bank If…

  • You Aim to Maximize Deposit Yields. Ally Bank’s interest-bearing checking account and money market mean customers have more places to earn a return on funds. Simple only has a savings account option, albeit with much higher yields than corresponding national averages.
  • You Want to Invest Where You Bank. Ally Bank has an in-house brokerage, Ally Invest. With no commissions on most self-directed investment activity and low or nonexistent management fees for managed portfolios, it’s one of the better investing platforms on the market today.
  • You Need a Home or Auto Loan. Ally Bank’s lending arm offers mortgages and auto loans, two very popular forms of credit that aren’t available at Simple.

You Should Use Simple If…

  • You Want a User-Friendly, Mobile-First Experience. Simple has a very impressive interface that works beautifully on mobile devices. Ally’s dashboard is user-friendly too, but it definitely works better on a desktop, and it can’t match Simple’s simplicity.
  • You Need a Personal Loan for Debt Consolidation. Simple offers unsecured personal loans for debt consolidation, a lifeline for anyone struggling with high-interest credit card debt. Ally doesn’t offer this particular credit product. Right now, this product is only available to prequalified customers.
  • You Want Your Financial Solution to Double as a Budget Helper. Simple’s built-in budgeting tools make it a suitable replacement for free budgeting software like YNAB (You Need A Budget), if not a business-grade money management platform. Automating your savings and identifying potential weaknesses in your spending patterns has never been easier.

Both Banks Are Great If…

  • You’re Sick of Managing Money In-Branch. Neither Simple nor Ally Bank has branch locations. A slim physical footprint keeps costs low and yields high, with deposit account customers the beneficiaries.
  • You Want to Minimize Fees. Neither bank charges excessive fees — no account maintenance fees or minimum balance fees, for example. Ally Bank waives ATM fees at Allpoint ATMs nationwide too. If keeping fees low (or avoiding them entirely) is a top priority, you can’t go wrong with Simple or Ally.
  • You’re Looking for Lucrative Savings Options. Both banks offer high-yield savings options, making it easy (and relatively lucrative) to park your funds for a rainy day.

Final Word

Ally Bank and Simple each have an impressive array of customer-friendly features. Simple’s powerful, easy-to-use budgeting tools make it a reasonable (and free) alternative to budgeting apps like YNAB (You Need A Budget).

Meanwhile, Ally Bank’s comprehensive lineup of high-yield accounts, including checking and money market accounts that yield well above the national average for those account types, make it a strong choice for consumers seeking to maximize returns on deposited funds.

Though Ally and Simple both have distinct strengths, neither is a disappointment. If you’re looking for a new place to park your money without dealing with the hassle of in-person banking, you can’t really go wrong with either.

Brian Martucci writes about credit cards, banking, insurance, travel, and more. When he's not investigating time- and money-saving strategies for Money Crashers readers, you can find him exploring his favorite trails or sampling a new cuisine. Reach him on Twitter @Brian_Martucci.