Sallie Mae Bank 2024 Review

Sallie Mae Bank Overview

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Expert Take: Sallie Mae Bank offers several savings options to its customers—savings accounts, a money market account and certificates of deposit (CDs). As an online bank with reduced overhead, the bank pays out attractive interest rates on these accounts along with no monthly fees. If you’re not looking for a checking account and your primary concern is earning a competitive return on your cash savings, the FDIC-insured bank is worth considering.

Pros

• Competitive interest rates
• No monthly maintenance fees on deposit accounts 
• Set up and track multiple savings goals with the SmartPig savings account 
• No minimum balances

Cons

• Limited customer service hours
• No physical branches 
• No checking account 
• No ATM access, debit card or ATM card

Sallie Mae Bank could be an attractive option to people who value earning higher APYs on their savings and paying no monthly fees. But customers who prefer banks that offer various financial services (including checking accounts) may prefer an alternative.

CDs: Sallie Mae Bank customers can choose between eleven different CD terms between six months and 60 months. The bank’s CDs feature competitive interest rates but require a minimum deposit of $2,500. 

Checking: Customers cannot open a checking account through Sallie Mae Bank. 

Savings: Sallie Mae Bank offers two savings accounts with zero monthly fees and daily compounding interest. With the Smarty Pig account, customers can create and track savings goals plus earn tiered interest rates based on how much they save. The High-Yield Savings Account features a slightly higher APY. 

Money Market: Sallie Mae’s money market account offers some of the best rates available. Plus, customers can enjoy benefits like the ability to write checks from their accounts, no monthly fees and free transfers.

Vault’s Viewpoint on Sallie Mae

The Sallie Mae brand is well known for the private student loans it offers to help eligible students and their families pay for college. But Sallie Mae Bank has a variety of savings accounts, money market accounts and certificates of deposit (CDs). These deposit accounts feature standout interest rates and no monthly maintenance fees. 

Sallie Mae could be a good fit for fans of online banking who value the opportunity to earn higher returns on their savings. But the online financial institution isn’t a one-stop banking solution. 

You must have another bank account established with another financial institution to get funds in or out of a Sallie Mae deposit account. The only ways to deposit or withdraw money from your Sallie Mae accounts are via electronic transactions or by writing a check from your money market account. The accounts don’t come with ATM cards or debit cards. Sallie Mae Bank customers also don’t have access to a checking account. 

The online bank also offers limited financing options to its customers. As of November 2023, the bank’s credit card program transitioned to First Bank & Trust, so the only financing currently available is private student loans.

Sallie Mae CDs

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APY

4.00% – 5.40%

Min. Deposit Requirement

$2,500

Term Length

6 months – 60 months

Expert Take

As with many other financial institutions, you can take advantage of the highest annual percentage yields (APYs) that Sallie Mae Bank offers by locking your savings up for a set period in a CD. While there are no monthly fees required on the accounts, you need a minimum deposit of at least $2,500 to open a CD with the bank.

If you withdraw your cash before the maturity date on your CD, you’ll pay an early withdrawal penalty that could wipe out 90 to 180 days’ worth of the interest you earned on your account, depending on your CD term. 

The best CD rates from Sallie Mae belong to its short-term CDs—accounts with 6-month to 18-month terms. The bank also offers 24-month to 60-month CDs. The interest rates on these long-term CDs are a bit lower but still competitive.

Pros

• Competitive interest rates
• Can request monthly interest distributions
• No monthly maintenance fees

Cons

• $2,500 minimum deposit
• Limited customer service compared to other banks

Sallie Mae Bank High-Yield Savings Account

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APY

4.50%

Min. Balance to Keep Account Open

$0

Min. Opening Deposit

$0

Monthly Maintenance Fee

$0

Expert Take

Sallie Mae Bank has two solid savings account options, and both have no maintenance fees and feature competitive APYs. The High-Yield Savings account comes with the higher interest rate of the two savings accounts—an APY that’s up there with some of the best rates available. 

The SmartyPig savings account from Sallie Mae lets account holders set and track different savings goals. The account has four different interest rate tiers for the following balances:

• $0.01 to $2,500
• $2,500.01 to $10,000
• $10,000.01 to $50,000
• $50,000.01+

But at the time of writing, the bank pays the same interest rate to customers with balances in all four of the interest rate tiers above. So whether you have a balance that fits into the lowest or the highest tier above, you’ll earn the same APY. (The bank does note that APYs are variable and subject to change.)

Pros

• Competitive interest rates
• No monthly maintenance fees
• Daily compounding interest

Cons

• SmartyPig account doesn’t offer the highest APYs available
• No ATM access or ATM card
• Limited customer service compared to other banks

Sallie Mae Bank Money Market Accounts

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APY

4.75%

Min. Balance to Keep Account Open

$0

Min. Opening Deposit

$0

Monthly Maintenance Fee

$0

Expert Take

The Money Market account from Sallie Mae is a standout among the online bank’s deposit accounts. Like the best money market accounts, this account works somewhat like a hybrid between a savings account and a checking account, offering you the convenience of check-writing capabilities along with competitive interest rates on your savings. 

The APY on the Sallie Mae Bank money market account is higher than the bank’s high-yield savings account and several of its CD options. You also don’t have to worry about paying monthly maintenance fees with this account and there are no minimum balance requirements. 

On the negative side, you don’t have the benefit of using an ATM card to access your cash from this account. The money market account doesn’t come with a debit card either. So if you want to withdraw cash from your account, you’ll need to write a check to another bank account or initiate an electronic transfer.

Pros

• Competitive interest rates 
• No monthly maintenance fee
• Check-writing capabilities 
• Daily compounding interest

Cons

• No debit card
• No ATM network or ATM card
• Limited customer service compared to other banks

About Sallie Mae Bank

Sallie Mae Bank is an online-only bank with headquarters based in Salt Lake City, Utah. The FDIC-insured financial institution was established in November 2005. Yet long before that, the company first opened its doors in 1973 as a federal student loan servicer.

Today, Sallie Mae Bank offers a limited variety of deposit accounts, including savings accounts, money market accounts and CDs. And while Sallie Mae is no longer a servicer of federal student loans, the brand is still associated with educational financing. Sallie Mae continues to be a well-known provider of private student loans for students and parents of students. 

Sallie Mae Bank Fees

One of the biggest perks of banking with Sallie Mae is the fact that the online bank charges few bank fees. The savings accounts, money market accounts and CDs from Sallie Mae Bank all feature no monthly maintenance fees. There are also no transfer fees or ATM fees to worry about since ATM access isn’t available. 

Here’s a look at some of the fees you could potentially encounter with Sallie Mae Bank. 

• Stop Payment Fees: $15
• Check Order Fees: Free at account opening, $5 afterward
• Expedited Check Order Fees: Free at account opening, $15 afterward
• Outgoing Wire Transfer (Same Day): $20
• Returned Deposit Fee: $5

Who is Sallie Mae Bank Best For?

A deposit account from Sallie Mae Bank may be a good fit if you prioritize earning high interest rates while avoiding bank fees. You’ll need to be comfortable with online banking and have another bank account established elsewhere since you’ll need to move money in and out of the account via check or electronic transfer due to the lack of ATM access. 

Who Should Consider An Alternative to Sallie Mae Bank?

If you’re a fan of in-person banking, this online-only bank isn’t the best option for you. Sallie Mae Bank also doesn’t offer a checking account. So some people may prefer to search for a different banking institution to keep all of their financial accounts under the same roof, whether that be a bank with physical branches or a different online bank brand. 

How Does Sallie Mae Bank Stack Up to Its Competitors?

Before you open a new bank account with any financial institution, make sure to shop around and see how the bank compares to others. Here’s how Sallie Mae Bank stacks up to the competition. 

Sallie Mae Bank vs. Citizens Bank

Sallie Mae Bank offers higher interest rates on its deposit accounts compared to Citizens Bank. Additionally, you don’t have to worry about monthly maintenance fees with Sallie Mae. With Citizens Bank, you must meet certain requirements to qualify for fee waivers on some of the bank’s deposit accounts. 

On the other hand, Citizens Bank has physical branches in 14 states along the East Coast and Washington, D.C. Customers of Citizens Bank also have access to a wider variety of deposit accounts, including checking accounts and financing products. 

Sallie Mae Bank vs. SoFi

SoFi has checking and savings accounts with competitive interest rates similar to what Sallie Mae offers on its High-Yield Savings and Money Market accounts. Eligible new SoFi customers may also be eligible for up to a $250 bank account bonus by setting up direct deposit on their account. 

Neither bank charges its customers monthly maintenance fees. And SoFi also has a feature, like the Sallie Mae SmartyPig account that can help customers work toward different savings goals. Sofi also gives eligible customers access to financing options like loans and credit cards but doesn’t offer additional deposit accounts. 

Sallie Mae Bank vs. CIT Bank

If your goal is to earn the highest interest rate on a savings account or CD, you’ll need to look at the individual account to determine whether CIT Bank or Sallie Mae offers the best returns. Overall, the APYs from Sallie Mae tend to be higher than CIT Bank. But CIT Bank does have a few accounts (both savings and CDs) that beat Sallie Mae’s rates by a slim margin. CIT Bank also has some deposit accounts with lower interest rates, while Sallie Mae customers don’t have to worry about this detail. 

Neither bank charges monthly maintenance fees on deposit accounts. But CIT Bank offers its customers an interest checking account option that may be appealing depending on your banking needs.