There are various types of savings account and offers and rates change all the time so it pays to do your home work and keep an eye on the latest offers. Most instant access savings accounts offer variable rates that can change at short notice, watch out for introductory offers of a bonus when you open a new account, always look at the underlying rate that will be paid at the end of the offer period.

Here is a brief summary of accounts available in the UK:

• Instant access savings accounts:
  Usually a £1 minimum investment required. Funds can be accessed on demand, interest rates vary. Instant access accounts are most suitable for people who need quick and reliable access to these funds.
  
• Easy access savings accounts:
  Usually £1 minimum investment required, interest rates vary and funds can be accessed within a few days, making them ideal for emergency funds.
  
• Notice savings accounts:
  Notice required to access funds (60 – 70 days for example). Interest rates vary and tend to be higher than instant and easy access accounts. Minimum investments are also higher and often several hundred pounds or more are required to open an account.
  
• Monthly interest savings accounts:
  Can be instant access, easy access or notice accounts and interest rates are variable.
• Online savings accounts
  Internet only accounts often represent good value. Money Jungle monitors deals available online. See the My Money Jungle Blog for good buys identified by moneyjungle.net.
  
• Fixed Interest savings Bonds:
  (Term Accounts): Minimum investment can be quite high by comparison, often £1000 or more. Funds cannot usually be accessed during the agreed term (typically 1 to 5 years) and penalty charges are generally applied for early withdrawals. Interest rates are fixed and may be paid annually or monthly. Savings bonds can offer a good rate of return provided you are sure that you will not need to withdraw funds during the agreed term.
  
• Stock market linked bonds:
  As with bonds, £1,000 or more is often the minimum entry level. Funds cannot be accessed until the end of a fixed term (which could be up to 5 years) Interest depends on a stock market’s performance but doesn’t reflect it as such. If an index (such as the FTSE 100) falls over the term you get back your investment and no interest is paid. If the index rises the interest is usually less than the full increase so make sure you understand how you will be paid on indexes performance. Many see this as a no risk way of playing the markets:ou can’t lose money on the investment, however, you might have been able to make more elsewhere.
  
• Individual Savings Accounts
  (ISAs): Individual Savings Accounts (ISAs) are tax-free savings accounts enabling individuals to save up to £7200 per financial year. (6th – 5th April). The limit will rise to £10,200 in April 2010 (September 2009 for the over 50s) Click here for more about ISAs.
  
  
• Saving for Children:
  A great article all about saving accounts for children is available from the BBC:
  http://news.bbc.co.uk/1/hi/business/3112942.stm

  Child Trust Funds: http://www.childtrustfund.gov.uk

  The Government is giving each newborn child a voucher worth £250 when their parents register for Child Benefit. This must be used to open an account – called a Child Trust Fund (CTF) account – on the child's behalf. You, your family and friends can all then add to this account. The Government will make a second contribution when the child is seven and is considering a third in the child's teenage years. The idea is that the account grows into a lump sum for the child to use when they are 18. Baby Bond is The Children’s Mutual’s simple and straightforward stakeholder CTF account. Such accounts are the Government's preferred way of growing your child's savings. In 2006 The Children’s Mutual was named Best CTF Provider by independent financial magazine Moneyfacts Life & Pensions.

  

  The Children’s Mutual also offers Sharia compliant Child Trust Funds.

  Information on saving is readily available and it pays to do your homework. Different savings accounts are suited to different situations and shopping around or seeking expert advice for the best deals is important.

  Protection

  With the turmoil in world financial markets resulting in a number of banks having to be nationalised, taken over or supported by national governments many savers are concerned about how secure their savings are. In the UK with effect from 7th October 2008, up to £50,000 of savings with a bank or building society are protected under the Financial Services Compensation Scheme. This is per depositor and joint savers are protected up to £100,000. Savings with overseas banks may be covered by other schemes.

  The demise of Icesave, the UK arm of the Icelandic bank Landsbanki, shows how important it is to always check details of the protection offered. This could be higher than the FSCS, for example the Irish Government now guarantees all deposits with Irish banks and some UK investors with high levels of savings have switched  their accounts to Irish based accounts to take advantage of this. In the UK National Savings is considered the safest place for deposits although the interest rates on offer may be relatively low, and other investors have taken advantage of the nationalisation of Northern Rock that is now seen as fully backed by the UK government. For more information see the FSA Money Made Clear website for more information.

  Even though the UK government has in recent case taken action to protect all personal saving deposits, it is sensible to spread savings across several banks and building societies to be sure that the FSCS guarantee will apply.

  Dormant Accounts
  
   

  The UK government is looking to using the billions of pounds held by banks in dormant accounts to fund community projects. It is estimated that the banks may have around £15billion in dormant accounts.

  These funds accumulate when the banks lose track of the account holders. No matter how old the account is the money still belongs to the account holder and they can get the account reactivated at any time.

  If you think that you may have lost touch with an account, or perhaps have a relative who may have done, mylostaccount.org.uk is a FREE service that helps you trace your lost accounts and savings.

  For the top interest rates available on line see the My Money Jungle Blog
  
  To explore savings options see the Business Directory
  
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