After last week’s WSJ article about interest rates, I noticed that both Goldman Sachs Bank USA (GS Bank) and Ally Bank have both been hiking rates on their CDs. Competition is good and I like that they both still show the desire to stay at the top as rates start rising again. (GS Bank is formerly GE Capital Bank, which also had a good history of maintaining high rates.) I’ll still chase a good limited-time CD rate if it’s high enough, but I like not having to move my cash around constantly.
Is Ally or Goldman Sachs a better overall place to keep your cash? Here is a direct rate comparison at various terms (as of 5/15/17). Both have hikes rates already this month.
In terms of side-by-side rate comparison, GS Bank is either the top or tied for the top at all the term lengths as of 5/15/17. Things could change with future rate changes. However, I would point out that their early withdrawal penalties are slightly different, with Ally being more lenient across the board.
Ally Bank Early Withdrawal Penalty Schedule
- Terms less than 24 months = 60 days of interest
- Terms 25 months to 36 months = 90 days of interest
- Terms 37 months to 48 months = 120 days of interest
- Terms 39 months and longer = 150 days of interest
Goldman Sachs Bank Early Withdrawal Penalty Schedule
- Terms less than 12 months = 90 days of interest
- Terms of 12 months to 5 years = 270 days of interest
- Terms of more than 5 years = 365 days of interest
Both offer fast transfers between external bank accounts as quickly as one business day. I have not opened a Goldman Sachs Bank account (yet) so I haven’t done a side-by-side comparison of transfer speeds.
Bottom line. Both Ally Bank and Goldman Sachs Bank are solid, all-around online banks and offer least highly competitive rates across all term lengths. Goldman has slightly higher rates at certain terms lengths, but Ally has smaller early withdrawal penalty. Alliant Credit Union is another worthy all-around competitor that I also considered, but Alliant’s certificate rates are lower across the board other than their 1.05% APY savings account which is tied. I hope to continue to take regular rate snapshots.
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Regarding transfer speeds, GS Bank ACH transfers take one business day for me. In addition, GS Bank offers same day wire transfers for free, so you really have same day access to your money.
Why not mention Fidelity?
Compare Fidelity Deposit rates
Account Name Rate
Fidelity 5 Year CD Rates 2.40%
Fidelity 3 Year CD Rates 1.85%
Fidelity 2 Year CD Rates 1.60%
I’ve been using Synchrony (previously GE Capital Bank) for some time now. Very competitive rates and great customer service. Just an FYI for another option.
Thanks for the refresh on this.
I still find high interest credit union checking accounts a better place for money. By piling all into one account, tracking your cash flow, and making sure to stay in budget, you get better returns ?.
Thoughts?
I believe Synchrony Bank is the former GE Capital Bank. Not sure about the history of GS Bank. I have found Synchrony Bank to consistently have the highest CD rates of the national online banks.
Synchrony is formerly GE Capital Retail Bank. Goldman Sachs is formerly GE Capital Bank. It appears that GE Capital was first, and then GE Captial Retail was an acquisition/merger of an outside bank and so they named it something slightly different. Both were eventually sold off when GE decided it didn’t want to be a finance company anymore after 2008.
Synchrony does have competitive rates across the board as well.
Just want to get my math double checked. I currently have money in Ally’s 1.25% 11-month no-penalty CD that matures in November. If I break it and put it in a 5-year 2.25% CD, I break even after about 9-10 months (actually less, assuming that at maturity it goes into the savings account of 1.05%). I’ve never done this kind of calculation and “CD play” before and am wondering if I should do this.