There are so many accounts available and while that means a lot of financial jargon to work through, it also means there’s something for everyone.
Here’s our pick of the best on the high street:
Easy access savings account
Virgin Money Defined Access E-Saver Issue 4
Interest rate (AER): 1.41 per cent
Minimum opening account: £1
Notice period: None
If you need occasional access to your savings, this account does not charge you to withdraw your own money. However, if you make four or more withdrawals in a year your interest rate will reduce to 0.75 per cent (AER).
You can choose between monthly or annual interest, and deposit as often as you like.
High interest current account
Santander 123 Current Account
Interest rate (AER): 3 per cent on balances between £3,000 and £20,000
Monthly fee: £5
This account is perfect if you have over £3,000 in savings to find a new home for. You will also earn money from paying certain household bills – between 1 and 3 per cent.
In order to qualify for the payouts the account must be credited with at least £500 per month and have two outgoing direct debits. This account has a fee of £5 per month as of 11 January 2016.
Notice savings account
120 day notice account (issue 4)
Interest rates (AER): choose between 1.96 per cent Gross Annual and 1.94% per cent Gross Monthly
Monthly fee: None
Minimum balance: £500
Maximum balance: £100,000 plus any resulting interest
Notice: 120 days
This account allows you to boost rates above easy access deals, but you need to provide 120 days notice for any withdrawals, so only get this if you can confidently predict and manage your cash flows.
Paragon gives 120 days notice on the variable interest rate.
Five year fixed rate account
FirstSave 5 Year Fixed Rate Bond 10th Issue
Interest rate (AER): 3.06 per cent
Monthly fee: None
Minimum balance: £1,000
Maximum balance: £2,000,000
Notice: withdrawals are not allowed with this account
Fixed rate savings accounts give a guaranteed rate for a set term. But the catch is you can’t take your money out or add further deposits during that period.
You also won’t benefit from any interest rate rises. Unlike many fixed-rate bonds, this FirstSave account lets you manage your account online. So you can easily log in to watch your savings rise.
Cash ISAs
Halifax Help to Buy: ISA
Interest rate (AER): 4 per cent
Minimum balance: £1 (no limit)
Minimum deposit: required to save between £1 and £200 each month
Notice: None
This ISA is the perfect way to get on the property ladder, as you must be a first time buyer.
Under the Help to Buy scheme, the UK Government will top up your account by 25 per cent, so for every £200 saved the Government will contribute a £50 bonus, up to a maximum of £3,000.
Only homes with a purchase value of £450,000 or less in London and £250,000 or less in all other parts of the UK are eligible. The bonus only applies to your final balance and you cannot contribute to another cash ISA in the same tax year.
Ethical savings account
Ecology Easy Access
Interest rate (AER): 1 per cent
Minimum balance: £25
Notice: None
Monthly fee: None
Ecology is ideal for people who want to know their savings are having a positive environmental and social impact.
The building society uses your funds to support ecological homes, organic farming and community businesses. By opening an account with Ecology, you become a member of the organisation, which also has a Charitable Foundation.