Ally has just added the ability to create Buckets, flexible sub-accounts that allow you to save for particular goals. Here’s how to use them.
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I guess you could say that I’m a pretty big fan of Ally.
Maybe it’s that I like their marketing campaigns. Maybe I like their activations at conferences at FinCon (like when they gave out 3-D printed piggy banks).
Maybe it’s that they are so fundamentally better than my other online savings bank experience.
Maybe I just like the color purple.
Ally isn’t without its faults. The biggest fault, historically, has been the difficulty in setting up multiple savings accounts.
When I first signed up, the process was laughably complex. They eventually made it a little easier, but still, the process was pointlessly obtuse. I don’t want multiple savings accounts. I want a single savings account and I want to be able to subdivide it into buckets.
Well, seems they’ve finally listened. I don’t want to take all the credit, but I did talk to them at an event to register my grievance, so I’d like to think that I had some effect. #influencer.
Ally is now using buckets. Let’s take a look.
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Because we don’t just need “savings”. “Savings for what?” is the better question.
We all need an emergency fund of six months or more of expenses, but that’s not all we need. We need savings for expenses that might be larger than a single month’s budget could cover.
Here are some things we need to save for:
- Down payment on a home
- Home repairs
- Car repairs / your next car (notice I didn’t say new car)
- An upcoming trip / general travel
- Anything you want
For example, I love records, and I have been coveting some expensive (for me) vinyl out there, but the prices are more than I can rationalize in a given month. So I’ve been thinking about setting up a separate savings fund for it. After all, a $60 record might seem excessive, but if I put $20 a month away, that seems more reasonable to me.
I call these savings funds “buckets”.
And it looks like Ally does too.
When you log into your Ally account, you get a notification that there are new features.
Clicking will send you to a short video about new features, including Buckets.
But this video, not linked there, is better:
(Note that Ally has also released a feature called Boosters, but that’s not relevant to us here.)
This appears to be everything I’ve been looking for, so let’s set one up.
Setting up a bucket
I’m going to set up a bucket that I call “Records”, so I can finally save up for that initial pressing of Slowdive’s Just For A Day on Creation Records.
For lack of a better source, I’m using my “Yearly savings” bucket, which I use for things that come up once a year or so, like my New York Times subscription or my domain hosting fees.
Now, when you click the name of your account, there is an Organize tab. Click “Organize your money”, and you’ll be taken to the Buckets page.
You can create 10 buckets. They have basic default categories, but I’m clicking the Make Your Own button.
And naming it “Records”.
Click “Done” and that’s it.
You can distribute money to and from the Bucket as you wish. (The amount of money not in a Bucket is known as “Core Savings”.) You can specify where money goes when it comes into the account, and where money is taken from when it is withdrawn. As far as I can tell, all of the basic abilities I would expect are there.
It would have been great if there was a way to do this automatically, to convert existing accounts into buckets, and then close the unnecessary accounts.
But that’s not possible. I reached out to Ally for confirmation on this, and I learned that you have to set up your buckets manually. Moreover, you can’t close accounts yourself; you need to ask someone at Ally to do that.
So if you’re like me and have been doing this manually on your own system, you’ll have to put in the work to convert to their system.
That’s a bummer, and you may be tempted to not bother.
But I would definitely bother, and that’s because, once you’re migrated, you get the best benefit of the buckets: easy creation and deletion.
After all, you won’t need all your buckets forever. For example, what do you do with your “Down Payment” bucket once you close on your home?
I have this DIY Flex spending account (or FauxSA, as I call it) for medical expenses that I set up last year, and I don’t need it anymore. But it’s still sitting there, because it’s a hassle to close it.
Were it a bucket, that wouldn’t be a problem.
Nice work, Ally
I applaud Ally for coming up with this very needed feature of a savings account. Anything that gets us thinking about savings more broadly, not just as a place where we put everything, but as a collection of products in service of our goals, the better off we’ll be.
Next up on my list: Pink Floyd’s Arnold Layne 7″ on Columbia Records. I have that song on CD, but, as fans of the song would surely attest, it’s not the same.
Have you set up Buckets with Ally? What has your experience been?
Also, I received no compensation for this post. I have no professional relationship with Ally. All my opinions are my own. I don’t do affiliate marketing. See my Disclosure Policy for more details.
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