Ally Everyday Cash Back Mastercard® review

As its name suggests, the Ally Everyday Cash Back card is an invite-only cash back card that offers generous rewards rates for everyday spending. The card is a solid option for earning rewards at grocery stores, gas stations and pharmacies or drugstores, and its 3% cash back rate in these categories is relatively high for a card with no annual fee.

That said, several competing cash back cards offer similar rewards rates, additional bonus categories and welcome offers valued at $200 or more, making them a better option if you can qualify.

Since Ally Bank credit cards are available by invitation only to eligible customers (either via a prescreened offer or CardMatch), this card may be a decent fit if you’ve struggled to qualify for rewards cards in the past. But if you have good credit, you can likely find a more lucrative option with better perks and benefits.

Why you might want the Ally Everyday Cash Back Mastercard

The Ally Everyday Cash Back Mastercard may be a good fit if you’re new to cash back cards, especially if you’re looking for a low-maintenance card that won’t burden you with a ton of fees or hike your interest rate if you pay late.

While the Ally Everyday card’s rewards rates aren’t incredible, the card also doesn’t set a limit on how much cash back you can earn. It also carries no annual fee and a decent ongoing APR that isn’t far off from the current average credit card APR.

Unlimited cash back in practical spending categories

The Ally Everyday Cash Back card earns an unlimited 3% cash back on purchases at grocery stores, gas stations and drugstores — three practical everyday spending categories that should make it easy to earn rewards.

While earning 3% back in these categories isn’t unheard of, many cards impose caps on your rewards rate that only let you earn at a boosted rate on a portion of your spending (such as the first $1,500 you spend in a category each quarter, after which you’ll earn just 1% back). For example, the Blue Cash Everyday® Card from American Express only gives you 3% back at U.S. supermarkets on your first $6,000 in purchases each year (after which, you earn 1% back).

Such restrictions can easily put a damper on some cardholders’ earnings. Luckily, the Ally Everyday Cash Back card won’t roll back your rewards rate, no matter how much you spend.

This makes the Ally Everyday Cash Back card a good low-maintenance option if you’re looking for a standalone rewards card that can earn cash back in some of the most common everyday spending categories.

No annual fee

The Ally Everyday card doesn’t carry an annual fee, which makes the card a great choice if you want to earn cash back on everyday purchases without worrying about offsetting additional costs.

While an annual fee isn’t common on cards like this, it’s a great boost to this card’s value. You’ll make the card worth it from your first purchase.

Fair APR

Finding a card with a low APR can be tough but the Ally Everyday Cash Back card offers a reasonable interest rate of 20.99% variable, which is only a fraction of a percentage point above the current average.

By comparison, the Petal® 2 “Cash Back, No Fees” Visa® Credit Card has a variable APR between 18.24% and 32.24% and offers a much lower cash back rate (just 1% cash back to start, with a maximum rate of 1.5% cash back after 12 on-time consecutive monthly payments). A chance at a slightly lower APR isn’t worth cutting your cash back in half if you don’t anticipate carrying a balance in the first place.

The Ally Everyday Cash Back card’s reasonable APR could make it a good pick if your credit score lands near the low end of good credit (a FICO score of around 670) and you want a generous cash back card. Other cards in this range might give you a slightly higher APR.

Few fees and no interest spikes

Many credit cards can sometimes come burdened with hidden fees or risky penalty APRs, but the Ally Everyday Cash Back carries very few fees.

You won’t pay foreign transaction fees, returned payment fees or fees for going over your credit limit. And while you’ll be charged a payment fee if you miss a payment, you won’t face a penalty APR.

Why you might want a different card

While the Ally Everyday Cash Back card boasts solid rewards rates and relatively few fees, it falls short when it comes to perks and long-term value, especially if you have at least a good credit score.

Cardholders looking to pay off debt or avoid interest charges on new purchases won’t find much reason to open an Ally Everyday card due to its lack of intro APR offers. The card is also missing a sign-up bonus, so it falls short of several competing no-annual-fee rewards cards. On top of that, the card only lets you redeem cash back as a statement credit, so you’re out of luck if you want to redeem rewards for travel, gift cards or merchandise.

No intro APR for balance transfers or purchases

A 0% intro APR offer on balance transfers or new purchases can be a valuable feature on a new credit card, allowing you to avoid interest for a year or more as you pay off debt, potentially saving you thousands of dollars.

Unfortunately, the Ally Bank Everyday Cash Back card doesn’t give you any 0% APR breathing room. You’ll face the card’s regular APR on any new purchases, which could prove costly if you end up carrying a balance long term.

If you want to pay off credit card debt or finance new purchases while minimizing interest charges, a card that carries an intro APR offer should be a better fit. Along with a dedicated balance transfer credit card, it’s worth considering a rewards credit card that carries an intro APR offer.

For example, the Capital One Savor Cash Rewards Credit Card comes with a 0% intro APR on purchases and balance transfers for 15 months, with a 19.74% - 29.74% (Variable) APR thereafter. If you transferred a $2,500 balance from a card with a 19% APR to the Savor and made $200 monthly payments, you could be debt-free in just 15 months while saving over $300 in interest charges, according to the CreditCards.com balance transfer calculator.

Carrying that same balance for 15 months on the Ally Everyday Cash Back could cost you hundreds of dollars in interest, even if you’re lucky enough to be assigned the low-end APR.

Only one cash back redemption option

The Ally Everyday Cash Back card only lets you redeem cash back as a statement credit. This may not be a deal-breaker if you’re focused on earning cash back, but several competing rewards cards let you redeem rewards not only as a statement credit, but also as a direct deposit or for travel, gift cards, merchandise, charitable donations and more.

No welcome offer

This may be the card’s biggest drawback. A welcome offer can bring a lot of value to a new credit card, giving you a chance to earn $200 or more after meeting the card’s spending requirement.

With good credit, you can easily find a competing rewards card that offers a sign-up bonus of at least $200 after you spend $500 to $1,000 in your first three months. While a sign-up bonus shouldn’t be the only factor you consider when choosing a new credit card, keep in mind that you’d need to spend over $6,000 to earn $200 back via the Ally card’s 3% bonus categories.

How does the Ally Everyday Cash Back Mastercard compare to other cash back cards?

The Ally Everyday Cash Back card may be a solid rewards option if you get invited to apply, but its cash back rate won’t be difficult to match with other cards. Some cards also offer additional benefits like a 0% intro APR, which is noticeably absent on a card in this class.

Here are a few alternatives to consider:

Blue Cash Everyday® Card from American Express	Petal® 2 "Cash Back, No Fees" Visa® Credit Card	Capital One Savor Cash Rewards Credit Card
Rewards rate  3% Cash Back at U.S. supermarkets on up to $6,000 per year in purchases, then 1%. 3% Cash Back on U.S. online retail purchases, on up to $6,000 per year, then 1%. 3% Cash Back at U.S. gas stations, on up to $6,000 per year, then 1%. 1% Cash Back on other purchases. Terms apply	Rewards rate  1% cash back on eligible purchases; up to 1.5% cash back on eligible purchases after 12 on-time monthly payments 2% to 10% cash back at select merchants	Rewards rate 8% Cash Back on Capital One Entertainment purchases 5% Cash Back on hotels and rental cars booked through Capital One Travel (terms apply) 3% Cash Back at grocery stores (excluding superstores like Walmart® and Target®), on dining, entertainment and popular streaming services 1% Cash Back on all other purchases
Welcome bonus  Earn a $200 statement credit after you spend $2,000 in purchases on your new Card within the first 6 months.	Welcome bonus None	Welcome bonus $250 Cash Back after you spend $500 on purchases within 3 months from account opening
Annual fee  $0	Annual fee  $0	Annual fee $0
APR 18.49%-29.49% Variable (See rates and fees)	APR 18.24% – 32.24% (Variable)	APR 19.74% - 29.74% (Variable)
Other things to know Up to $84 in streaming service statement credits each year after using this card to pay a $9.99 or more Disney Bundle monthly subscription (via $7 monthly credits; enrollment required, subject to auto renewal) 0% intro APR on purchases and balance transfers for 15 months 18.49%-29.49% Variable thereafter) Up to $180 in Home Chef meal solution statement credits (via $15 monthly credits; enrollment required) Access to American Express Pay It Plan It alternative payment plans	Other things to know No foreign transaction, late payment or returned payment fees No penalty APR Credit limits between $300 and $10,000 without a security deposit Includes money management tools that show account balance, spending and payment due date	Other things to know No minimum redemption or expiration for cash back Automatic redemption available at set thresholds ($25, $50, $100 or $200) Lengthy intro period on both new purchases and balance transfers

Ally Everyday Cash Back Mastercard vs. the Blue Cash Everyday Card from American Express

The Blue Cash Everyday card from American Express is an especially valuable no-annual-fee cash back card available to users with good to excellent credit. It has generous cash back rates in key purchase categories, a fair welcome offer, an intro APR on new purchases and balance transfers and an expansive portfolio of perks and benefits that bring added value to the card beyond its cash back rates.

The Blue Cash Everyday and Ally Everyday Cash Back cards share a similar 3% cash back for U.S. supermarket and U.S. gas station purchases, but instead of 3% cash back at drugstores, the Blue Cash Everyday offers 3% back at U.S. online retailers. Based on average reported consumer expenditures from the Bureau of Labor Statistics in 2021 for items like apparel and household furnishings, this might even be a more rewarding category than drugstores.

However, the Blue Cash Everyday places a $6,000 per year limit on purchases at U.S. supermarkets and gas stations for its 3% cash back rate. After you spend that amount in either category, you’ll earn a meager 1% cash back on purchases in that category for the rest of the year. This will hinder your cash back if you spend more than this amount and you were to compare your earnings with the Ally Everyday card, which will continue to earn 3% back.

The Blue Cash Everyday card makes up for that drawback by providing a $7 monthly cash back credit for The Disney Bundle if you enroll and use your card to spend $9.99 or more each month on an eligible subscription (subject to auto renewal). This package is valued at $84.

Ally Everyday Cash Back Mastercard vs. the Petal 2 “Cash Back, No Fees” Visa Credit Card

The Petal 2 card is a great alternative for cardholders who want a cash back card with no fees and a chance at a lower ongoing APR. While the Ally Everyday Cash Back checks all of those boxes, its APR is slightly higher, making it a potentially poor option for users who might carry a balance.

The Petal 2 provides a nice incentive by encouraging cardholders to make on-time monthly payments for a year. Provided you do this, you’ll qualify for a boosted 1.5% cash back on all purchases. Although this is still lower than the Ally Everyday card’s best cash back rate in select categories, it can be good for cardholders who make frequent purchases in categories that would earn just 1% back on the Ally card.

Although the Petal 2 has a potentially lower ongoing APR, on the high-end it can climb to a substantial 32.24% variable. This is much higher than the Ally Everyday card’s 20.99% APR. However, the Petal 2 may be a better choice than the Ally simply because it provides a monthly payment incentive (increased cash back rate after 12 months of consecutive on-time payments).

But if you’re a disciplined user and make frequent, practical purchases you can easily predict and pay off month-to-month, the Ally Everyday card will net you a nice chunk of cash back while accomplishing the same credit building goals as the Petal 2. This makes the Ally card a solid pick for users with good credit, but who want to work their way even higher.

Ally Everyday Cash Back Mastercard vs. the Capital One Savor Cash Rewards Credit Card

Capital One’s cash back card might actually be the preferred choice for the cardholder who wants no frills, no limits and a generous amount of cash back for nearly every purchase they make. It earns 5% cash back on hotels and rental cars booked through Capital One Travel, 3% cash back for purchases in the categories of dining, entertainment, grocery stores (excluding superstores like Walmart® and Target®), and popular streaming services, 8% cash back for Capital One Entertainment purchases and 1% back on all other purchases. It’s probably one of the most expansive cash back programs for a card with no annual fee.

Unlike the Ally Everyday card, the Capital One Savor also provides you with several redemption options. You can redeem cash back for statement credits, a check or for gift cards. You can redeem any amount at any time, and even schedule automatic redemptions to occur at designated thresholds of $25, $50, $100 or $200.

The Savor also carries an intro APR for new purchases and balance transfers. Although its regular APR can be a little higher than the APR on the Ally Everyday card, this intro offer makes opening a new account a much more attractive offer considering the generous intro APR period.

How to use Ally Everyday Cash Back Mastercard

• Use your card for all grocery, gas and drugstore purchases to make the most of its boosted cash back
• Access your FICO score for free in the Ally Credit Card mobile banking app to monitor your credit score
• Although you won’t need to worry about penalty APRs, pay your bill on time each month to avoid late fees

Is the Ally Everyday Cash Back Mastercard right for you?

The right card for you will bring cash back or rewards value to your wallet without overwhelming you with fees. The Ally Everyday Cash Back Mastercard cuts the majority of cardholder fees and provides a decent cash back program for everyday spenders who shop for food at home. If you’re new to good credit, this can be a great card if you want to get started with cash back and rewards – provided you get an invitation to apply.

However, if you have a good to excellent credit score there are better options to keep in mind. The Ally Everyday Cash Back card lacks a sign-up bonus and it comes with very few cardholder perks and benefits. If you want your card to carry value outside of rewards – and still pay no annual fee – then you could be more satisfied with the Blue Cash Everyday card from American Express. Alternatively, if you plan to make several purchases in categories other than groceries, gas and drugstores, you might want to apply for a flat-rate cash back card to earn 2% back for all of your purchases.