Ally Bank Interest Checking Review — Interest Rate & Features

Most checking accounts pay no interest on balances. They cede that perk to savings accounts, which are designed to hold funds you don’t need to pay this month’s bills.

Interest checking accounts are different. Though they rarely yield as much as high-yield savings accounts, they make it worth your while to keep a checking cushion. 

Ally Interest Checking is one such account. It has a bunch of other notable perks that make it more than suitable for everyday use as your primary checking account too. Read on to see if those outweigh its downsides.

What Is Ally Interest Checking?

Also known as the Ally Spending account, Ally Interest Checking is a free checking account that yields 0.10% APY on balances up to $15,000 and 0.25% APY on balances above that amount.

Ally Bank is an online-only bank with no branches, but Ally Interest Checking has more than 43,000 fee-free ATMs in its network and a robust mobile app that can replace the in-person banking experience for the vast majority of users. Other notable account features include built-in spending buckets that can help with budgeting, two layers of overdraft protection with no out-of-pocket fees, and an early direct deposit feature that can get you paid up to two days early.

Ally Interest Checking is one of several Ally Bank deposit accounts. The bank also has a high-yield savings account, money market account, and several different CDs. Other Ally financial accounts and services include a commission-free online brokerage, an auto lending department, and a home loan department that makes primary and secondary home loans.

What Sets Ally Interest Checking Apart?

Ally Interest Checking stands out from similar checking accounts for several reasons:

• Overdraft protection with no fees. Ally Bank offers two layers of overdraft protection. Neither charge any fees; the bank eliminated overdraft fees entirely in 2021. That’s quite rare in the banking industry. 
• Big fee-free ATM network for an online bank. Ally Interest Checking has more than 40,000 fee-free ATMs in its network. You can find them all over the United States, so it shouldn’t matter too much where you live or travel.
• Spending buckets for easy budgeting. You can create up to 30 spending buckets to categorize your monthly expenses. All bucketed funds remain in your checking account, but the buckets help you budget and see where you’re spending too much. 
• Powerful mobile app. The Ally Bank app is better than the average mobile banking app. With a fast, easy-to-use interface and clutch features like mobile check deposit and rapid person-to-person payments, it easily stands in for Ally’s standard online banking dashboard when you’re on the go.

Key Features of Ally Interest Checking

Ally Interest Checking has all the features you’d expect from a full-service online bank, plus some legitimately notable perks not found everywhere else.

Account Fees & Minimums

This account has no monthly or annual maintenance fee. There’s no minimum opening deposit and no ongoing minimum balance requirement either.

Account Yield

Ally Interest Checking has a two-tiered yield system. The yield is 0.10% APY on balances up to $15,000 and 0.25% APY on balances above that amount.

ATM Access

Ally Interest Checking has more than 43,000 fee-free ATMs in its network. You can withdraw cash without a surcharge anywhere you see the Allpoint logo.

Spending Buckets

Ally Interest Checking allows you to create up to 30 individual spending buckets to manage distinct pools of cash within your account. You can use the buckets for anything you want (and customize their names accordingly), but Ally really emphasizes how useful they can be for budgeting.

You can move cash into and between buckets instantly with the Ally mobile app or online account dashboard. All bucketed funds remain in your checking account, but you can choose which buckets to pull from for external transfers or bill payments.

Overdraft Protection

Ally Interest Checking has two overlapping layers of overdraft protection. Neither has any fees:

• Overdraft Transfer Service: This feature pulls from a linked Ally Bank savings account to cover negative-balance transactions. Ally rounds up the transferred amount to the nearest $100, so a $75 overdraft would trigger a $100 savings transfer.
• CoverDraft: This feature provides up to $250 in coverage for negative balances. Your account can remain overdrawn until the next deposit hits.

Even with complimentary overdraft protection, Ally reserves the right to decline specific transactions that would result in a negative balance and may revoke overdraft privileges if you frequently overdraw your account.

Early Direct Deposit

If your employer or government benefits provider qualifies, and most do, you can get your paycheck up to two days early with Ally Interest Checking. If your paycheck normally arrives on Friday, the money hits your account on Wednesday.

Paper Checks

You can order standard paper checks for your Ally Interest Checking account as often as you’d like with no order fees. Personalized checks may carry a design fee.

Mobile Features

Ally Bank has a comprehensive, user-friendly mobile app that can do just about anything the standard online banking interface can. It’s well-reviewed and has relatively few complaints from verified users, most centering on apparent glitches that may be user error. 

Notable capabilities include:

• Mobile check deposit
• One-time and recurring bill payments
• Person-to-person transfers through Zelle
• Spending bucket management
• Check reorders

Deposit Insurance

Ally Interest Checking comes with federal deposit insurance up to the standard FDIC limit of $250,000. 

Pros & Cons

Ally Interest Checking has more advantages than disadvantages overall. 

Pros

Ally Interest Checking is almost entirely fee-free and has lots of user-friendly features.

• No maintenance fees. This account has no monthly or annual maintenance fee. You pay nothing to keep your account active, no matter how much or how little you use it.
• No minimums. This account has no minimum opening deposit or ongoing balance requirement. Since you don’t have to worry about keeping a certain amount in it, it’s useful as a low-balance secondary checking account.
• No overdraft fees. Ally Bank charges no overdraft fees on this account. You have access to two overlapping overdraft protection plans, one that draws from your linked savings account and one that draws from deposits to the account.
• Large network of fee-free ATMs. Ally Bank’s ATM network has more than 40,000 fee-free machines located in every state and major metropolitan area.
• Comprehensive mobile app. Ally Bank has one of the best mobile apps of any online bank, which is pretty high praise. It’s easy to use and can replicate all the functionality of the standard online interface.
• Spending buckets make it easy to manage your budget. You can set up as many as 30 spending buckets to manage recurring expenses, short-term goals, and other aspects of your household budget. It’s much easier than using a spreadsheet or third-party budgeting software.
• Get paid up to two days early. Most employers and benefits providers qualify for early payday. If you normally get paid on Friday, you’ll get your paycheck on Wednesday instead.

Cons

Ally Interest Checking isn’t as generous as some competing interest checking accounts and isn’t appropriate for people who prefer in-person banking.

• Lower interest than some comparable accounts. This account’s yield tops out at 0.25% APY, and you need to have at least $15,000 in the account to earn at that rate. Otherwise, your yield is just 0.10% APY. Both rates are less generous than some otherwise similar interest checking accounts. 
• No account opening bonus. This account has no account opening bonus for new users. Some competitors offer bonuses worth hundreds of dollars when you complete qualifying activities after sign-up.
• No debit card rewards. Ally Interest Checking has no spending rewards program. You can’t earn cash back on debit card purchases with this account, as you can with many other bank accounts.
• No physical branches. Ally Bank is an online-only bank with no physical branches. Its desktop and mobile interfaces are robust enough that you’ll probably never feel the need to visit a branch, but it’s not appropriate if you like having a branch network as a fallback.

How Ally Interest Checking Stacks Up

Ally Interest Checking competes against quite a few interest-bearing checking accounts. One of its closest cousins is Quontic High Interest Checking. Before applying for either, see how they compare.

	Ally Interest Checking	Quontic High Interest Checking
Maintenance Fee	$0	$0
Minimum to Open	$0	$100
Minimum Ongoing	$0	$50
Maximum Yield	0.25% APY	1.10% APY
Qualifying Activities?	Not, but maximum yield requires $15,000 daily balance	Yes, 10 debit card transactions per month
Debit Card Rewards?	No	No
ATM Network	43,000+ locations	90,000+ locations

Ally Interest Checking is a better fit for occasional users and users with low account balances, thanks to its total lack of minimum balance requirements and transaction requirements to earn interest. But Quontic High Interest Checking has a higher maximum interest rate if you’re able to clear the monthly transaction hurdle.

Final Word

Ally Interest Checking is a straightforward checking account with a decent but not really notable yield and tons of user-friendly features. If you’ve struggled to get a handle on your budget in the past, occasionally overdraw your account, or silently curse your current bank every time you open its mobile app, give it a closer look.

Just don’t expect any miracles. Ally Interest Checking is less generous than some competing accounts, so you need to decide whether the perks and usability justify the below-average return on your balances and spending.