Aspiration and Ally Bank are both digital banks that offer different banking services with a focus on social impact. Both have specific benefits and financial products for their customers, but how are they different, and which one is for you?
Ally is a more mature digital bank with a plethora of financial products, similar to traditional banks. On the other hand, Aspiration has better APY, cash back, and plants trees.
For that reason, if you’re looking, or will be in the future, for loans, mortgages, IRAs, CDs, or any other financial product, Ally has got you covered.
But, if you want a spending and savings account that’s great for everyday use but also helps you save some money, Aspiration is for you.
Pros & Cons
|Plant trees by swiping your card||No overdraft fees|
|Up to 5% APY on your savings with Aspiration Plus||Free transfers|
|Get paid two days early||Free overdraft service|
|Offsets your carbon footprint when buying fuel||No minimum balance requirement|
|No minimum balance||No monthly maintenance fees|
|55,000+ fee-free ATMs||55,000+ fee-free ATMs|
|No big bank fees||No fees on cashier checks|
|No money given to fossil fuel projects||Checking, Savings, CDs|
|Personal and auto loans|
|Investing and retirement|
|Aspiration Plus has a monthly fee||No cash deposits|
|$10 opening fee||Lagging customer service|
|Must spend $1,000 minimum monthly on a debit card to earn the APY|
|Transfer limits in the first 30 days|
|Limit of $1,000 for incoming transfers|
|Doesn’t accept foreign checks|
Aspiration was started by Joseph Sanberg and Andrei Cherny in 2013 but officially began operations in 2015. Headquartered in Marina del Rey, California, this fintech is not a fully-fledged bank, but it’s registered as a brokerage that offers investment products and branchless banking services.
This company is different from other players in the banking industry due to its focus on the environment, climate change, and planet protection. All its products and businesses are tailored toward saving the planet.
In addition, they have created a reward system that encourages its customers to support companies that finance fossil-fuel-free projects.
Aspiration’s mission is to help everyone. The company helps its customers to spend, save, and invest with a conscience to make the world a better place.
Unlike other banks, they don’t use customer deposits to fund oil pipelines. Because of this, customers earn cashback and bonuses when they partner with socially conscious businesses.
Aspiration deposits are held by the partner banks, whereas Beneficial State, Member FDIC, issues the Aspiration Zero Mastercard. Your money is also protected because the deposits are FDIC-insured for up to $2,250,000.
How to Open an Aspiration Account
Once your account is active, the company provides you with a virtual card to use for your transactions as they mail a physical card.
Ally Bank is a leading digital financial services company that was established in 1919. Starting as part of General Motors, the bank was useful in helping auto dealers when the car assembly company started.
The company transformed into a digital bank many years later and changed its name to Ally Bank in 2009.
For the past 100 years, its mission has been focused on “Doing It Right.” The belief is that they have a responsibility to make a positive impact on the community. Ally is also different because it emphasizes environmental, social, and governance (ESG) issues.
How to Open an Ally Account
You have to choose from a Bank, Invest, or Home Loans account and Auto Financing account.
|ALLY BANK||ASPIRATION||ASPIRATION +|
|No monthly or annual fees||No monthly or annual fees for basic account||$7.99/m fee|
|No minimum balance||$10 minimum opening deposit||$10 minimum opening deposit|
|Free to open an account||Free to open an account|
|No fee for using debit card||No fee for using debit card||No fee for using debit card|
|55,000+ fee-free ATMs||55,000+ fee-free ATMs||55,000+ fee-free ATMs|
|Reimburses up to $10/m for out-of-network ATMs||Third-party ATM fees apply||One out-of-network withdrawal reimbursed per month|
There are mostly no fees across the board with both apps.
Accounts & Cards
Aspiration Spend and Save or Pay What Is Fair, is the basic plan that gives you the option to choose your monthly account maintenance fee, which can be as low as $0.
The account also has an early paycheck feature that enables customers to get their paychecks two days earlier. In addition, you can also opt to plant trees with each round-up on your savings accounts.
This account also offers 3-5% cash back on purchases made at socially conscious companies as well as a 3.00% APY.
Aspiration Plus is a paid account ($7.99/m) that gives you more benefits, such as 10% cashback and up to 5.00% APY. With this option, you still access all the 55,000 free in-network ATMs, two days early paycheck, a personal impact score, and automatic offsets for the negative climate impact of driving your car.
The company also gives you one out-of-network ATM reimbursement monthly.
You can also apply for the Zero credit card from Aspiration. This new card will reward customers who play a part in erasing their carbon footprint.
Shopping with this card will give the bank a chance to use the merchant’s fees to plant trees and add rewards to your account. Customers can now sign up for early access to join the card waitlist.
Online Saving Account has a 3.00% APY. It also has extra features such as buckets, surprise savings, boosters, and recurrent transfer accounts.
Buckets allow you to create up to 10 savings buckets that coexist and earn interest in one online savings account.
Boosters such as recurring transfers enable the customers to move money into the savings account regularly.
The round-ups track the checking accounts to round up transactions to the nearest dollar, while with surprise savings, the bank analyzes your linked checking accounts for cash to save on your behalf.
The Interest Checking account from Ally earns an interest of 0.10% for less than $15,000 minimum daily balance and 0.25% for $15,000 minimum daily balance.
Customers can also save in a Money Market fund. This account earns up to 3.00% APY on all balance tiers. The bank compounds the interest daily.
High Yield Certificates of Deposits (CDs) earn a higher interest rate when you lock in your funds for a longer term. They don’t have a minimum deposit requirement and have a 1.50% APY. however, if you leave your money for 12+ months, the APY goes to 4.00%.
There are also Raise Your Rate CDs and No Penalty CDs, with a 3.25% and 3.30% APY, respectively.
Ally also offers credit cards for different purposes:
- Ally Platinum
- Everyday Cash Back
- Unlimited Cash Back
- Unlimited Cash Back for Nurses & Educators
Credibility & Security
Aspiration doesn’t hold a banking license. However, it’s a registered brokerage that’s safe for your money deposits. All the funds are held at Aspiration’s partner banks, which are FDIC-insured for up to $2,250,000 per depositor.
There’s been some controversy surrounding the company. Namely, ProPublica claims that the company’s client numbers are broadly exaggerated and that the organization is greenwashing and not accomplishing all that it claims it’s doing for the environment.
Ally is a well-respected company that is a leading digital financial services company, a Member FDIC, and Equal Housing Lender. All the funds, except securities products, are FDIC insured for up to $250,000.
Anyone older than 18 with a permanent US address and an SSN can open an Aspiration investment account.
There are two investment account types:
- Taxable account
- Traditional IRA account
The Redwood Fund helps you build your portfolio and be socially conscious at the same time. The fund only invests in industry leaders that are sustainable and socially responsible.
Redwood Fund is managed by one of the largest asset managers in the world – USB Asset Management, on the behalf of Aspiration.
The Redwood IRA has an annual custodial fee of $15, and is more like a traditional IRA, while focusing on investing in sustainable companies while removing taxes upfront.
Ally offers plenty of investment options to its customers:
- Self-Directed Trading
- Robo Portfolios
- Wealth Management
Investment choices include:
- Stocks & ETFs
- Commission-free ETFs
- Mutual Funds
- Margin Accounts
- Securities Income Program
The Self-Directed Trading platform lets you trade commission-free 24/7. There are no account minimums and you can even move over an investment account you have elsewhere. Including individual stocks or all your investments.
You even get a $75 credit if you transfer more than $2,500 from another broker.
With Robo Portfolios, you can start investing with a $100. All you have to choose is whether you prefer the cash-enhanced or market-focused portfolio.
Portfolios were designed by human experts and are managed and monitored daily. You can also update your portfolio goals as you see fit.
There are four portfolio choices:
- Core (for hands-off investors)
- Income (higher dividend yields)
- Tax optimized
- Socially responsible
Aspiration has a great score of 4.3 stars out of 5 on Trustpilot, with 70% of 1,167 reviewers giving it an excellent mark and 23% a poor one. With this score, Aspiration is placed better than traditional banks like Bank of America (1.4), Chase (1.3), Capital One (1.2), and Wells Fargo (1.2). It’s also worse than MoneyLion (4.7) but better than Current (3.8), or Varo (3.8).
Ally, on the other hand, isn’t doing well on Trustpilot. They have only a 1.1/5 star rating from 356 reviews. Per rating, that places it among the traditional banks and not digital banks, which is ironic because Ally is a fully-fledged bank now.
People seem to have the most grievances with extra-long wait times to get customer support.
It fairs much better on the Google Play Store (3.9/5 from 24,441 ratings) and Apple App Store (4.7/5 from 48,479 ratings).
Why You Should Choose Aspiration
Aspiration services are 100% fossil fuel-free, and the firm even donates about 10% of its income to environmentally friendly businesses.
The rewards and cashback from the company are tailored around a sustainability score. The Planet Protection feature automatically offsets the carbon dioxide for every gallon of gas you purchase using Aspiration Plus.
With an Aspiration debit card, you can receive up to 10% cash back while making a difference if you shop at a Conscience Coalition member’s store or website.
Customers are encouraged to make a statement by shopping at companies that Aspiration has selected for doing the right thing with regard to planet protection.
If you shop with Conscience Coalition partners, you earn a cashback from Aspiration. The basic Spend & Save account earns 3-5% cashback, whereas the Aspiration Plus premium account will earn you 10% in cashback rewards.
Customers on Aspiration Plus can earn up to 5.00% APY. Compared to other digital and traditional banks, this is a high yield on a savings account.
Why You Should Choose Ally
Range of Financial Products
Ally offers digital banking services combined with financial products that you’d find in most banks.
They have an interest checking account, savings account, high-yield CD, Ally Invest, and Ally Home. It’s a full-service bank that provides all these services without the need for a physical location.
If you need a bank with low to no fees, Ally is an excellent alternative. The bank doesn’t charge monthly maintenance, ETM withdrawals, minimum balance, overdraft, and transfers. You won’t need to pay for a minimum balance like with Aspiration.
All financial products and services are available via the app and online on the website. You can make transactions on the go without the need for a physical branch. In addition, their customer support is available 24/7. You can reach out via phone, email, or live chat.
While Ally is acting more like a traditional bank, Aspiration is offering a modern high APY, high cash back, and highly socially conscious account. Something that people are very much looking forward to.
To decide which digital bank to choose from comes down to whether you need a full suite of financial products (Ally) or you want a simpler account that also allows for some savings and investing (Aspiration).
Whichever you choose, you’ll get an account with no monthly maintenance fees and almost no fees in general, which is always a plus in our book.