Skip Ally Bank... Here's a MUCH better option #Best Education Page #Online Earning

- So in this video today we're going to be talking about

the best place to put your short term

or emergency fund savings.

So a lot of people out there,

including myself,

have a decent amount of cash saved up

that you don't necessarily want to

go out there and invest in the stock market

or real estate because this is money

that you wanna have set aside

in case of an emergency,

or just to have a rainy day fund.

Now most people, unfortunately, even if they do have

their rainy day fund,

they place this in a traditional bank savings account,

which typically pays around 0.05% interest.

And as we know inflation sits

at around two percent per year,

and as a result they are losing money

every single year because of inflation.

Now there are a couple of different online savings accounts

that are able to offer significantly better rates,

primarily because they don't

have any physical branch locations,

which saves a huge amount of money.

Now in the past Ally Bank

was like the go to bank for online savings.

But then in June of this year

they had a very surprising announcement,

and it was one of the first times

that they had a rate change towards the negative.

So they were paying an APY of 2.2%.

However, then in June of this year

they lowered that rate to 2.1%.

So Ally bank used to really be leading the pack here

with the online savings account,

offering a very competitive rate,

but they've kind of fallen out of favor here

with this rate change,

and we've seen some pretty big people,

including Graham Stephen, even talking about

potentially changing over to

a different online savings account

because of this difference in the rate.

And it may not seem like a lot of money,

but when you have tens of thousands,

or even hundreds of thousands of dollars in some cases

sitting in an online bank account,

the difference of half a percent

could be a significant chunk of change,

making it worth potentially switching over

to one of these different online savings account options.

About three weeks ago we heard about

a completely different option that seemed very appealing.

And that was something called the Wealthfront cash account

being brought to us by Wealthfront,

which is an online robo-advisor.

And essentially what they were offering here

is a 2.57% APY, which is significantly better

than the 2.1% being offered by Ally Bank.

Now beyond that there were actually a couple

other areas where this online bank account

was superior to what Ally Bank was offering.

So through the Wealthfront cash account

you could get FDIC insurance up to one million dollars.

On top of that you got unlimited free transfers,

whereas with Ally bank you were limited

to six transfers per month.

You also got zero fees with a $1 minimum,

and of course that very appealing 2.57% APY.

Well shortly after this announcement,

here we are about a month later,

and we have a third option,

which is even better than Ally Bank and Wealthfront,

and in case you guys haven't guessed it already,

it comes to us from their biggest competitor,

known as Betterment.

So Betterment released something about a year ago

called Betterment Smartsaver.

I actually talked about it on this channel here,

but it caught a lot of flack because

of the fact that this account did not

have FDIC insurance.

So Betterment went back to the drawing board

and they decided to come up with a better option,

which does have FDIC insurance,

and on top of that this account allows you to earn

up to 2.69% APY,

which is significantly better than Ally Bank at 2.1%,

and it's even better than what Wealthfront is offering

through the Wealthfront cash account.

So this service is being labeled Betterment Everyday.

Right now they are only offering online savings accounts,

but down the road later this year

they will also be releasing an online checking account,

which will also come with a debit card

to do your purchases right through

your Betterment Everyday account.

And this will integrate directly

with the Betterment robo-investing platform.

And a lot of people are probably wondering

why is it that Ally Bank

can't pay a rate like Betterment Everyday

or the Wealthfront Cash Account?

And it primarily has to do with

the stages these companies are in.

Both Wealthfront and Betterment

are still in the growth stage,

and they have a lot of venture capital behind them.

And as a result they can afford

to pay significantly higher rates than their competitors

who are more established.

So through Betterment Everyday Savings,

what you're getting is FDIC insurance

up to one million dollars,

which is the same thing being offered by Wealthfront.

You're getting your zero fee platform,

so there are no fees whatsoever

for using Betterment Everyday,

not a $1 minimum, but they dropped it down

to a $0 minimum balance.

And then of course that 2.69% APY.

And like I said, this will ultimately be replacing

that feature known as Smartsaver.

But as of right now this is one

one of the most appealing and attractive

savings options paying the highest APY.

So one of the questions you probably have

is will I be switching over from Ally Bank?

And unfortunately one of the rules Betterment

has for their affiliates is that their affiliates

are not allowed to have a Betterment account.

It's really kind of annoying and I love Betterment

and what they're offering,

but unfortunately, because

of my affiliate relationship with them

I am not allowed to have an account.

But I may be switching over to Wealthfront's Cash Account

since it is a higher APY

than what I'm getting with Ally Bank.

But overall what I would say here is people

who are looking to maximize and get that highest APY,

Ally seems to be falling from the front of the pack

towards the middle of the pack in terms of their rates.

And we are seeing significantly better rates

from Betterment for example, as well as Wealthfront.

If you guys do decide that you want

to learn more about this,

and potentially sign up for the Betterment Everyday Savings,

that's the top link in the description below.

As I mentioned already, I am affiliated with Betterment

so if you do use my link,

at no additional cost to you,

I get a small commission in the process.

Totally up to you if you guys wanna use that link or not.

At the end of the day I just wanted to

bring these options to you guys

just to show you that there are online savings options

that are paying significantly better rates than Ally Bank.

But anyways guys that's gonna wrap up this video.

Let me know in the comments section down below

where do you do your banking

and what kind of rate are you seeing

with your savings or your checking account?

I would love to hear what options you guys are using.

But thanks so much for watching this video.

I hope you enjoyed it.

And I will see you in the next one.

#Best Education Page #Online Earning

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