Sallie Mae Bank Review: Great Rates and No Monthly Fees
Minimum Daily Balance Requirements
- Competitive rates
- Lack of monthly fees and minimum daily balance requirements
- Goal tracking with online piggy bank account
- No checking options
- No branch availability
About Sallie Mae Bank
Sallie Mae Bank, which is the online banking arm of SLM Corp., was established in 2005 and is headquartered in Salt Lake City. Even though Sallie Mae Bank only offers limited products and services and does not offer checking accounts, it’s the perfect pick for helping you meet your savings goals. So it’s no wonder Sallie Mae Bank made GOBankingRates’ Best Banks of 2022 rankings in the following categories: Best CD Accounts, Best Money Market Accounts and Best Savings Accounts. The bank also ranked as one of the Best Online Banks of 2022.
Sallie Mae offers two savings accounts: SmartyPig and its High-Yield Savings Account. Here are the details for each.
You can think of Sallie Mae’s SmartyPig Account as a virtual piggy bank that allows you to set up specific savings goals and track them. However, there are plenty more reasons why GOBankingRates named it one of the Best Savings Accounts of 2022. To start, the account has a competitive interest rate of 0.70% annual percentage yield for balances up to $10,000. Plus, you can earn a $10 reward for each friend you refer who opens a SmartyPig Account and makes a deposit, up to a maximum of 100 friends and $1,000 in total rewards.
Additionally, the account has no fees or minimums, and you can set up automatic biweekly or monthly savings deposits to increase your balance. Additionally, you can add funds to your account at your convenience.
High-Yield Savings Account
With Sallie Mae’s High-Yield Savings Account, you can earn interest faster than you would with most traditional savings accounts. The 0.35% APY is over five times higher than the national rate of 0.06% and is compounded daily and paid monthly. Additionally, no minimum balance requirements, no monthly maintenance fees and free transfers mean you’ll have more money in your pocket (or your savings account) each month.
Money Market Account
Sallie Mae’s Money Market Account is a standout among money market offerings from both traditional institutions and other online banks. Its competitive rate of 0.50% APY is just one of the reasons why GOBankingRates named it as one of the Best Money Market Accounts of 2022. The other advantages of this account are that it has no monthly maintenance fees or minimum balance requirements — plus, it offers free transfers.
Certificate of Deposit Rates
GOBankingRates ranked Sallie Mae Bank as having one of the Best CD Accounts of 2022 due to no monthly fees and high APYs, which are considered some of the best CD rates available. CD terms are available from six to 60 months, with varying rates according to term. Here’s a rundown of the most competitive rates the bank offers: CDs with terms of 12, 24 and 30 months offer a 0.60% APY, while CDs with an 18-month term offer a 0.65% APY. The highest CD rate Sallie Mae offers is tied to its 36-month and 60-month CDs, which is 0.80% APY. Although the rates are competitive, it’s important to note that a $2,500 minimum opening deposit is required on all CDs.
The selection of banking products you want and competitive rates may be what you focus on when searching for a bank, but these other factors are worth considering too.
Minimum Daily Balance Requirements
Sallie Mae Bank does not require you to meet minimum daily balance requirements like other banks. This can be helpful if you are working to build up your balance over time, such as if you are trying to meet a savings goal.
Monthly fees are nonexistent at Sallie Mae Bank, which is a standout feature because you won’t have to worry about those fees eating into your savings balance. Other banks charge monthly fees and often allow you the option of having them waived, but you have to meet one or more requirements, such as maintaining a minimum daily balance or setting up regular direct deposits.
Like other competing banks, Sallie Mae offers account holders the ability to complete their banking tasks by logging into their accounts online or via the bank’s app. Sallie Mae’s banking app is available for both iOS and Android devices, with a rating of 4.6 out of 5 on the App Store and 3.9 out of 5 on Google Play. The app includes helpful features, such as account summaries on the home screen, including credit cards; the ability to apply for a loan with pre-filled information and check the status of a loan application; and a quarterly FICO score.
As already mentioned, Sallie Mae offers competitive rates on its savings, money market and CD accounts, which means that you can potentially earn more than if you open an account at a competing bank. For example, Wells Fargo’s rates on its various savings products, including CDs, are considerably lower, at a maximum of 0.02% APY, which also includes the relationship rates it offers.
Sallie Mae’s selection of savings products and competitive rates without the hassle of monthly fees or minimum balance requirements are what make it worth considering — even if you have to look elsewhere for checking options.
Sallie Mae Bank vs. Competitors
One way to get the big picture about a bank is to see how it measures up to its competitors. Here’s a snapshot of Sallie Mae versus competing financial institutions.
Sallie Mae vs. Wells Fargo
Sallie Mae is an online-only bank, which means that you won’t be able to receive face-to-face service. However, Wells Fargo shines in that area by allowing its customers to meet with its representatives in person and even conveniently book an in-person appointment with a banking representative by going online. However, Wells Fargo charges monthly service fees on its savings accounts if you don’t meet minimum daily balance requirements, while Sallie Mae does not.
Sallie Mae vs. Chase
Chase is considered a full-service bank with all the banking products and services consumers typically seek, while Sallie Mae is much more limited and only offers student loans, savings accounts and credit cards. However, Sallie Mae’s savings account options are fee-free and do not require account holders to maintain a specific minimum balance, whereas Chase charges monthly fees if you don’t meet requirements, such as a minimum daily balance.
Sallie Mae vs. PNC
PNC Bank offers relationship rates when you link your savings account to one of its eligible checking accounts. Sallie Mae doesn’t offer checking accounts or a relationship rate option. However, Sallie Mae does offer the SmartyPig account, which allows you to set goals and track them, and even includes its own separate app. PNC does not offer a similar account.
If you’re looking for a financial institution that will allow you to do all your banking in one place, Sallie Mae isn’t it because the bank doesn’t offer checking accounts. However, it makes up for it by providing for all your savings needs with savings accounts, including its popular SmartyPig account, money market account and a variety of CDs. The bottom line: If you’re looking for a secondary bank that offers competitive savings rates with a unique twist on the standard savings account — and you don’t mind doing all your banking online — Sallie Mae is worth considering.
Sallie Mae FAQHere are a few of the most commonly asked questions about Sallie Mae Bank.
- Is Sallie Mae FDIC insured?
- Yes, Sallie Mae's accounts are FDIC insured.
- Does Sallie Mae offer home loans or student loans?
- Sallie Mae does not offer home loans, but it does offer undergraduate, graduate and career training student loans.
- Does Sallie Mae offer private student loans?
- Yes, the student loans that Sallie Mae offers are considered private student loans.
Rates are subject to change; unless otherwise noted, rates are updated periodically. All other information on accounts is accurate as of Dec. 19, 2021.
Editorial Note: This content is not provided by Sallie Mae Bank. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author alone and have not been reviewed, approved or otherwise endorsed by Sallie Mae Bank.