Choosing the best savings account can be confusing. There are lots of different types to choose from. Our table shows many of the savings accounts you can get online, over the phone or by visiting a branch.

It's also important to keep in mind that, there's never one best savings account as every one has different needs and requirements. Although usually, accounts that offer the best interest rates are considered the best, but that might not be the case if you want to be able to withdraw your money at any time.

What are your savings goals?

Often, which savings account you should choose depends on your savings goals.

For example If you're saving for a new car or a holiday, an easy access account may be ideal as you'll be able to withdraw your cash without a penalty.

If you're saving to buy a house, or to put aside money for retirement, an ISA may be a better option.

Or if you're just starting out, a regular savings account can help you get in the habit of putting money aside every month.

Find out how to choose the best savings account for you

Who can open a savings account?

To open a savings account, you have to be:

  • 18 or over

  • A UK resident

However, you can open a cash ISA when you're 16 years old.

What types of savings accounts are there?

Before you start looking for the best savings account for you, think about what type of savings account you'll need. There are lots of different types.

Deposit savings accounts

These keep your money in a bank or building society. They might not always give the best savings account rates, but they don't put your funds at risk because they don't invest your money in the stock market. These accounts include

  • Instant access accounts: These let you withdraw cash whenever you like.

  • Easy access accounts: Your withdrawals can take up to a week to process, but the flexibility means you won't get the best savings interest rates.

  • Notice accounts. You have to give notice to withdraw cash or you'll pay a penalty, but you'll get some of the best savings account interest rates out there.

  • Regular savings accounts: These generally require you to pay into the account every month.

  • Fixed rate bonds: You tie your savings up and can't access them until the end of the set term. But if you'll earn a higher return than your usual savings accounts.

  • Sharia savings accounts: These are offered by Islamic banks and pay you a regular 'profit' instead of interest, which is against Islamic law.

Find out how each of these accounts works here.

Tax-free savings accounts

These let you save money, without paying tax on any interest you make. They'll often offer you some of the best savings interest rates too. But remember that you're restricted on how much you can pay in each tax year (6 April - 5 April). These accounts include:

  • Cash ISAs

  • Help to Buy ISAs.

Find out more about ISAs here.

Children's savings accounts

These are designed specifically for children. They can be opened by a parent or guardian on behalf of your child. Children's savings accounts include:

  • Junior ISAs

  • Junior stocks and shares ISAs (junior investment ISAs)

  • Young person's savings plans

  • Children's instant access accounts

  • Children's notice accounts

  • Children's fixed rate bonds.

Here are the best ways to save for your child.

Business savings accounts

These are specifically designed for businesses, so they can save and earn interest on their spare cash. They include:

  • Business instant access accounts

  • Business fixed rate bonds.

Here's how business savings accounts work.

Risk-based savings accounts

These put your money at risk. But they give you the chance of a much larger return compared to savings accounts. They include:

Find out more about savings accounts here.

High interest savings account

Currently, with the Bank of England base rate being so low, high-interest savings accounts will be difficult to find. But that doesn't mean there aren't competitive rates out there.

Once the base rate rises again, you're more likely to see a return of high interest savings products to return to the market.

What are the pros and cons of savings accounts

Like most financial products, there are some advantages and disadvantages to savings accounts:


  • Are easy to open

  • Accrue interest so you make your money work for

  • Some allow easy withdrawals when you need to

  • Are protected by then FSCS

  • You can open some with just a 1 initial deposit.


  • Interest rates at the moment are really low

  • Some accounts may charge a hefty fee for withdrawing your money

Do you pay tax on savings?

Most people can earn savings account interest without paying any tax on it at all.

If you're a basic rate taxpayer you can earn up to 1,000 of interest from a savings account without paying tax. If you're a higher rate taxpayer, you can earn up to 500 from savings accounts. Even with a very high interest savings account it's unlikely you'd earn this much on your savings.

This amount you can earn from interest is called your Personal Savings Allowance. It's in addition to the amount of tax-free interest you can earn from an ISA.

Only people with large amounts of savings need to worry about having to pay tax on the interest they earn from their savings. That's less than 5% of people.

Here's more information on how tax affects your savings.

Can I have more than one savings account?

Yes, you can. It means you can get the benefits from the most competitive savings accounts.

It can be a good idea if you a large sum of money to save. You could put some into a one-year fixed that pays the best savings rates and some into an easy-access account, so you can get to the money easily if you need it.

Do your research and find the best savings accounts before you decide where to put your money. Remember, you could put it all into a savings account that gives you easy access to your money while you decide what to do.

How do I open a savings account?

Once you've found the best savings account for your needs, with the best interest rates you'll be able to open it either online, by phone or in branch. Some accounts have to be opened in specific ways.

To open it, you'll need ID and proof of your address so the bank can do its checks.

When you want to close your savings account, you just need to contact your bank. Some accounts need you to give notice. If you don't give that notice and take your money out, you could lose some or all of your interest.

What are the best ways to save money for your child?

The best way to save money for your child's future is usually through a children's savings account. It is an account that can only be opened by a child under 18 or on their behalf.

Your bank or building society will likely offer a children's savings account, but it is important to compare providers to find the best rates. You will find that children's savings accounts usually pay a significantly higher interest rate than adult savings accounts. This makes them a great way to save for your child's future, especially compared with saving the money in your own savings account.

There is no perfect formula to finding the right account for you and every family will have their own best options. However, there are a number of types of savings account for you to choose, so you should be able to find a product to fit your financial goals.

For example, an instant access children's savings account will let you pay money in and take it out at any time, but will not usually offer you the best interest rates.

If you think you will need to access your child's savings then an instant access savings account should suit your needs.

If access is not a priority, you should look for accounts offering high interest rates. High interest accounts such as fixed term bonds and junior stocks and shares ISAs should produce a better return on your child's money.

Savings FAQs


How much can I save?


Usually as much as you want, but some accounts restrict how much you can save. This guide explains how to manage each type of account.


Can I take my money out whenever I want?


Yes, but only if the account allows withdrawals. Some do not let you take any money out without a penalty, find out more in this guide.


Do I have to tie my money up to save?


No, you can choose how much access you have to your money by choosing the right savings account. This guide explains which accounts are available.


Can I have a savings account if I have bad credit?


Yes, your finances are not checked when you open a savings account. If you need help choosing the right savings account, read this guide.


What is the difference between AER and gross interest?


The Annual Equivalent Rate (AER) shows you how much interest you will earn over the course of a year taking into account compounding and other charges. The gross rate is the flat rate of interest that's actually paid.

About our savings accounts comparison


Who do we include in this comparison?


We include personal savings accounts from our panel. They are regulated by the Financial Conduct Authority (FCA).

Here is more information about how our website works.


How do we make money from our comparison?


We have commercial agreements with some of the companies in this comparison and get paid commission if we help you take out one of their products or services. Find out more here.

You do not pay any extra and the deal you get is not affected.

Last updated: 12 April, 2021