bank rates

Just Started Saving? Try This Account

hand dropping money in a jarIf you know someone just getting into the habit of saving money, the big British bank Barclays has unveiled a new account that might be the right fit.

It’s called the Dream Account, and it’s designed to encourage people to deposit money every month into their savings account – and leave it there.

You’ll earn 0.95% APY with a Dream Account, and you can deposit up to $1,000 each month (www.banking.barclaysus.com).

That deposit restriction makes this a less-than-ideal regular savings account. But we think it makes a good first account. Here’s why:

If you make a deposit for six straight months, you’ll receive a bonus of 2.5% on the interest earned on your account.

And if you haven’t made any withdrawals for six consecutive months, you’ll get another bonus of 2.5% on the interest you’ve earned.

This bonus isn’t going to make anyone rich, but it’s a nice incentive for those who need it.

Barclays even allows individuals to open up to three Dream Accounts.

There’s no minimum deposit required to open a Dream Account and no minimum amount required to earn interest.

Because of the restriction on monthly deposit amounts, we’re not including Barclays Dream Account in our ranking of national savings leaders. But at 0.95% APY, the rate is second only to The Palladian PrivateBank (www.palladianprivatebank.com), which pays 1.00% APY.

However, The Palladian PrivateBank requires a $10,000 minimum deposit to open an account. Lower balances still earn 1.00% APY, but you’ll be charged a $10 monthly service fee by the Chicago-based bank.

Otherwise Barclays has a regular savings account with no restrictions paying 0.90% APY. Like the Dream Account, there are no minimum deposit requirements to open an account and no minimum amounts required to earn interest. Both Barclays accounts carry no monthly fees.

The bank is part of Barclays Bank PLC of London, with U.S. headquarters in Wilmington, Del.

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