This post is late, I know, shame on me. Believe me when I say that as my own boss, I will have a stern talking to myself later. But, friends came into town for the weekend and anyway, life must go on!
Now to get to the serious helpful stuff…
In our previous post, we talked about Lake Michigan Credit Union and its amazing 3% interest checking account. Well, that account came with a lot of requirements and for the lazy person out there, it is just too much of a hassle to deal with.
That’s a valid point but if you are saving money for anything, say it be a house, a car, or your emergency fund, you should at least store it someplace where you can earn a modest amount of interest. The average savings account in the U.S. offers a measly 0.06% interest on your money. There are a few savings and checking accounts out there that offer 1% interest on your hard earned dollarydoos. Here is one of our favorites…
You’ve probably heard of Barclays Bank before as they are a huge financial institution, just not so much in the U.S. personal banking area. They are headquartered in London U.K. and are a sponsor of the Premier League.
What we like about Barclays Bank.
- They aren’t trying to replace your current bank. This isn’t a new checking account with ATM or debit cards. They literally only offer savings accounts with 1.00% interest apy. You don’t need to change banks as this only serves as a savings extension of your current checking account.
- There are no minimum balance fees, minimum transaction fees, first born child fees. There are no fees what-so-ever. In fact, you couldn’t even get a debit card if you wanted to make transactions.
- Money transfers are simple. They have an external account section of their website where you simply put in routing numbers and account numbers from your checking account. Barclay will send two test deposits of a few cents each to verify the account is yours. Once this is done, you can easily move money into or out of your Barclays account from the website. You can also set up reoccurring transfers to save money automatically. As an added bonus, typically, a transfer from Barclay into another bank counts as a direct deposit to satisfy bank sign up bonuses. By typically, I mean it has worked every time I have tried.
- 1.00% interest apy. This isn’t the best out there but considering you don’t have to do anything but leave your money there, it is one of the easiest out there.
- Sub accounts. They make it super simple to set up subaccounts so you can divide what you are saving for.
We have three separate accounts
We store a portion of our emergency fund here.
Instead of putting our property taxes in escrow like most homeowners, we prefer to pay them ourselves. Therefore, a portion from my paycheck gets deposited into this account every pay period. When property taxes are due, I have just enough to pay them in the account.
We are currently savings for a new car so what better place to store money that will be used in the short term.
What we don’t like
- They don’t offer a mobile app. Their mobile web interface is ok but I really would prefer an app.
- You can only have 3 linked checking accounts at once. This is a little annoying for us, as in addition to churning credit cards, we also churn bank accounts so we have anywhere from 4 to 6 bank accounts open at any time. For most people however, this probably isn’t a problem.
- Transfer Time Transferring money from your Barclay account into your checking account will take a few days. This is the case for any bank to bank transfer but it can be annoying if you need the money in there right away.
This account is great for storing emergency funds or if you are saving money for the short term and you don’t want to deal with the requirements of minimum balances, monthly deposits and debit card transactions. It sucks it doesn’t have an app but since it is just a savings account, it most likely wouldn’t be used very often anyways.
What this account is not good for.
People who are making long term savings.
If you are making long term savings such as college or anything more than 2 years away, you are probably better off investing the money in a low cost mutual fund or index fund. Even through the 1.00% interest rate is good you will still lose money to inflation.
People who don’t like their bank.
If you are looking to change banks, then this won’t work. You will need to open a checking account somewhere else or this account will be worthless.
*Remember, we are not financial advisors in any way, this is what works for us. Use your discretion! We are not payed to advertise for this bank, we are just happy clients.*