Best savings accounts

Get a good return on your savings

Plunging interest rates at the beginning of 2009 left many savers struggling to find the best rates for their savings. We've explored the options – from cash Isas to easy-access savings accounts – to help you get the best return on your money.

Best Buy savings accounts

Even when interest rates are falling, there will always be some savings accounts that are better than others. You can either look at our Best Rate savings accounts or to find the best savings account to suit your needs, try our interactive savings calculator which will point you to where the top rates are for the amount you want to save. You can even get started straight away by clicking through.

If you're saving for the first time, don't just go with your bank because it's easy – shop around for the best rate you can get. And if you can tie your money up for one or two years, it's worth considering fixed-rate savings accounts.

Cash Isas

Don’t assume you’ll get the best savings rates from mainstream banks

If you are a taxpayer, get as much as you can out of taxed accounts into tax-free accounts such as cash Isas. You can put up to £5,100 into a cash Isa from 6 April 2010. See our cash Isa reviews for the latest Best Rates.

With an ordinary savings account, any interest you earn will be taxed at 20% if you're a basic-rate taxpayer, and 40% if you're a higher-rate taxpayer. Some people may be taxed at just 10%, but only if their savings income, when added to all their other income, was less than £2,440 during 2009-2010.

Even if you are being taxed at only 10%, it's still 10% of your interest going in tax instead of to you, so it's well worth investing in a Best Rate cash Isa to get the best return on your savings.

Consistently high-paying savings accounts

If switching your savings account every year to chase the best rate sounds like too much hassle, then consider a savings account that has paid above-average rates for a number of years. 

Invest in a cash Isa to avoid paying tax on your savings

Our reviews of cash Isas and easy-access savings accounts highlight accounts that have been consistent Best Rates for the last 12 months.

Is switching worth it?

Chasing the best savings rate can bring you a bit of extra interest, but you'll have to weigh up whether the extra you get is really worth all the time and effort that transferring an account and setting up new accounts can take.

While it's worth making sure your money is working as hard as it can for you, choosing a savings account with good consistency means you'll get a good rate for your savings, and save yourself time and hassle as well.

Stock market investments

If you're watching the interest you receive from your cash plummet, you may be tempted to opt for stock and shares.

Advisers and fund managers are trying to entice cash savers over to shares by reminding them that while share prices go down, they go up again – usually at a faster rate than cash.

However, don't be side-tracked by these messages. Think about where you're comfortable putting your money. Just because interest rates are falling doesn't mean you should suddenly switch to more risky investments if they weren't right for you before. If you can't afford to lose your money or you need access to it within five years, stocks and shares are not for you.

However, if you're prepared to take a risk and tie up your money for more than five years, now might be a good time to invest. If you're not sure, take independent professional advice (see our guide to choosing a financial adviser).