Another Card Bites the Dust: Farewell Ally Educators Inspire Card!
Hey credit card enthusiasts, Phillip here from Points of Phillip! Today, I'm sharing why I recently closed my Ally Educators Inspire card. Let's dive into the what, why, and how!
The Card in Question: Ally Educators Inspire
This card was an offer I received in the mail last summer. The Educators Inspire card, similar to the Nurses Inspire card and Ally's standard card, offered a simple perk: 2% cash back on all purchases with no annual fee. Think of it like the SoFi card: straightforward and rewarding.
I initially grabbed it because I knew I needed new tires and brakes. The card offered a sweet 12-month 0% APR period, meaning I could spread out those car repairs and still snag 2% cash back – a solid deal for automotive expenses!
Why I Took the Plunge (Despite the Velocity)
Okay, credit card gurus might have raised an eyebrow at this. Last summer, my credit card application velocity was HIGH. I knew I was pushing it when the offers from Merrick Bank and credit repair services started rolling in. The Ally card wasn't the strongest offer, lacking a signup bonus, but it aligned with my financial goals at the time.
For the past year, I held onto the card, primarily due to my Ally savings and checking accounts. Having multiple Ally accounts gave me a 10% rewards boost on redeemed cashback. It wasn't a game-changer (just an extra 10% on the 2%), but it was a nice perk coupled with Ally's interesting high-yield savings account features.
The Breakup: Why I Said Goodbye
So, why cancel a card that was seemingly working? Here's the kicker: Merrick Bank is acquiring Ally's credit card portfolio.
My concern? These bank transitions often create a new account on your credit report. I've already opened 20 accounts this year, and I wasn't thrilled about adding a Merrick Bank card to the mix. Merrick Bank caters to people with lower credit scores, and I didn't want that association on my credit profile.
The Merrick Bank Factor: A Deeper Dive
Merrick Bank's credit card options are limited to the Merrick Bank credit card and the Merrick Bank Classic Secured card. The "cheapest" option is a secured card with a deposit requirement.
Their unsecured card might offer credit line re-evaluation, but it comes with potential annual fees charged monthly (up to $72!). The annual fee for the unsecured card could be as high as $72, but it could also be $0 at least for the first year depending on what they target you for. In fact, usually you have to get a direct mail offer in order to be able to apply for this card.
The biggest deal-breaker? No perks. While the Ally card offered 2% cash back, Merrick isn't known for rewards programs. I didn't want to risk a product change to a card with no rewards and potential fees.
Moving On: My "Catch-All" Alternatives
Losing the Ally card isn't a huge blow. I have other "catch-all" cards like the Fidelity Rewards Visa (2% cash back, no annual fee, and the ability to invest those rewards) and the Venture card (which my wife and I use because Capital One won't give me the Venture X!).
What's Next for My Ally Accounts?
Ally is entirely online, and while I have several online accounts, I'm also chasing checking account signup bonuses with Wells Fargo and Bank of America. I also have Capital One, American Express, and Chase accounts.
I might close my Ally accounts since they aren't essential right now. My savings are currently parked in my Goldman Sachs Apple savings account (for general savings), American Express high-yield savings account (for baby stuff), and Capital One savings account (for taxes). Less apps and less complication sound good to me!