What savings account should I choose?
Now you’ve identified your saving goal and you’ve started putting money away each month, you need to decide on the best place to put it.
Do you want an ordinary savings account or an ISA? An ISA is a savings account where you don’t pay tax on the interest. Anyone aged 16 or over can put up to £15,240 into their cash ISA during the current tax year, with the threshold rising each April in line with inflation.
Before choosing your savings account MoneySavingExpert has identified 10 need-to-knows, including:
- Have you used your 2015/16 ISA allowance yet? It allows you to save without paying tax on interest.
- Are you willing to switch bank accounts? You can boost saving rates.
- Can you put money aside each month? Consider a regular saver.
- Can you lock cash away? Fixed savings give a (slightly) better return.
Moneyfacts.co.uk has a great savings comparison tool you can use to help you decide what account to choose and most of the comparison websites offer an analysis on the different saving accounts available.
Make sure you consider all your options before choosing your account, and remember one size doesn’t fit all!