What Happens When Ally Bank CD Matures

I opened a 9-month No Penalty CD account with Ally Bank last July. Though I could withdraw after only 6 days without having to pay any penalty, I kept the money in the account because Ally Bank has been slowly, but steadily, cutting rates since then and the rate I got back then was pretty good.

The CD matured last Friday. Since the current rate for the 9-month No Penalty CD is much lower than that of the online savings account, I don’t want to keep the CD account any more. I want to move the money to the savings account instead. However, I wasn’t able to find out how to transfer the money from CD to savings account (I remember there’s an option to fund the CD account with money in the savings account) after going through all the options online. So I called Ally Bank to get help. While on the phone, I first asked what happens when my CD matures because, if the money is automatically rolled over to the savings account, which I suspected that’s the case, then there’s no need to ask my question any more. The CSR on the phone told me that when the CD matures, it will be automatically moved to a new 11-month No Penalty CD unless I instruct the bank differently. The CSR asked me whether I want to keep the money in the 11-month No Penalty CD, which currently has an yield of 1.35% APY. While the rate is better than the online savings account (1.29% APY), I still want to  move the money to the savings account since we are going to spend a lot on the house we bought once the sale is closed.  So I declined the offer and asked to close the account.

I also asked the CSR why I can’t make the transfer, from CD to savings account, online and was told that this operation can only be done over the phone. It’s not a big deal if I have to call to make the transfer, but I still think it would be nice if I do it online in my account, especially for a web only bank.

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