BMO has a pretty good "starter" savings account.

[nidena]

If you open a new savings account with them and grow your balance by $200 every month, they'll deposit $5 each month for the first 12 months.  Considering interest rates for basic savings accounts are less than 1%, this is a pretty easy way to gain an extra $60.

If you're in Canada, they have a similar but not the same promo going on.

bmoharris.com for U.S.
bmo.com for Canada

[haapai]

It's not an easy way to gain an extra $60 when you have credit card debt at over 12%.  Assuming no low balance fees land up getting assessed, paying down the credit card debt by an additional $200 a month is going to net a person a whole lot more over the course of a year.  It takes a couple of months for paying off the card to pull ahead, but once it does, the math is undeniable and it carries forward into the next year. 

Then there is inflation.  This might be a sweet offer if inflation were low but when you start thinking about 7% annual inflation, it begins to stink after the first couple of months. 

[nidena]

If folx have no CC debt, it's not terrible.  There are no minimum balance requirements for the lowest tier.

Besides, once you pay off a card, you can't pay extra on it so there's no harm in saving in liquid format.

[phil5185]

"""""""""with them and grow your balance by $200 every month, they'll deposit $5 each month for the first 12 months. Considering interest rates for basic savings accounts are less than 1%, this is a pretty easy way to gain an extra $60. """"""

If, instead, you were to place the $200/month into a SP500 Index, it would grow to about $530,000 in 30 years (based on the long-term average of 11%/yr).

[nidena]

Dec 13, 2022 19:54:32 GMT -5 phil5185 said:

"""""""""with them and grow your balance by $200 every month, they'll deposit $5 each month for the first 12 months. Considering interest rates for basic savings accounts are less than 1%, this is a pretty easy way to gain an extra $60. """"""

If, instead, you were to place the $200/month into a SP500 Index, it would grow to about $530,000 in 30 years (based on the long-term average of 11%/yr).

You could do that in year two.     Nobody said leave the shit there.  

Besides, most investing isn't so liquid, and some people may want access to their funds after just a year.

Not everyone has any desire to invest.  Especially if they have income that continues into perpetuity.

[Cookies Galore]

Capital One savings accounts are at 3% APY, probably a quicker way to get a few extra dollars each month. If I'm saving $200 on top of $200 each month I'd better get more than $5!

[CCL]

Fidelity recently had an offer for opening a new account. Deposit $50, get $150 free. I opened the account and put my (more than $50) deposit into a 3 month CD paying 4%.

[Tiny]

Dec 13, 2022 19:41:01 GMT -5 nidena said:

If folx have no CC debt, it's not terrible.  There are no minimum balance requirements for the lowest tier.

Besides, once you pay off a card, you can't pay extra on it so there's no harm in saving in liquid format.

I agree.  for someone who perhaps only has a checking account - this could be a way to start building savings and get a little extra in "interest".     
The starter account has an interest rate of .01%    which is pretty much the norm for banks - it's weird how bank accounts and bank offered CDs interest hasn't really gone up much.  

So, for someone who isn't aware of Ally (or is to timid to commit to Ally) this kind of a starter account could be a reasonable first step to building savings.   It doesn't look good long term (more than 12 months)... but it still could be a way to expand one's banking "experience" - and who knows - perhaps they will gain more confidence in saving regularly and in knowledge and be able to make the jump from "savings account with next to interest" to some other financial institution and get a better return on their money.    

You got to start somewhere.  

[CCL]

Agree, it could be a good start. The difficulty for some would be coming up with an extra $200 a month, especially if they aren't already in the habit of saving. If they can do automatic deposits that might be helpful.

[busymom]

I'm all for free money.  Especially during a time when my stock market accounts have lost money.  

[Tiny]

Dec 13, 2022 23:43:19 GMT -5 CCL said:

Agree, it could be a good start. The difficulty for some would be coming up with an extra $200 a month, especially if they aren't already in the habit of saving. If they can do automatic deposits that might be helpful.

Yes, there are still hoops to jump thru - but atleast the account doesn't require more $25.00 to open it.   

I'm getting more and more disillusioned with the idea that "any American can get ahead with hard work and discipline".  America definitely goes out of it's way to punish the poor - simply because they are poor. It also punishes those who are just starting out (who may not have had "privilege" to get them financially started) and those who are getting back on their feet (and starting from a point of financial disadvantage).

It's nice that this BMO "starter" account only has a $25.00 minimum to open it (and no required minimum balance.) Also there isn't any requirement that $200 a month MUST be deposited. Any month with a $200 deposit (in the first 12 months of opening the account) will get the $5.00 bonus. If you don't make the deposit you don't get the $5 for that month. That's the way I understood the "requirements/terms" of the account (I may have misunderstood I only skim/read it once.)

This might be something that helps get someone into the habit of savings as they work on being able to routinely save.  AND they pretty much come away with some bonus if they can meet the requirement at least once in a year.

While I agree it's probably better to open an account somewhere else - the person opening the account may need to have a larger minimum amount and or commit to a monthly deposit to get any sort of bonus - they may not meet the criteria to get the bonus or may wind up incurring fees.