Few things to consider about savings accounts

Finding the right type of savings account can make all the difference.

07:39 02 January 2014

The right type of savings account can cast a magic spell. Yes, it might mean the difference between having an account that helps your money to grow and protects it and ending up on the losing end of the financial dream pool.

There are a few things to consider when looking into saving accounts and financial institutions that can help make your decision a little easier.

• Make sure the savings account and the institution are insured. You want to ensure that they are registered. This will grant you protection up to a certain amount. It is important to know what the limit amount is for your account and consider alternative accounts for any amounts that go over. The coverage is based on per person, per account. There is nothing limiting the number of savings accounts you can have. However, the amount is limited to £85,000 per account.

 

• Cash ISA accounts can be a great way to save money. These savings accounts allow you quick access to your money and they are tax-free. This helps you to fight inflation. They do have a downside. The accounts are limited to the amount that can be deposited in them during a given year.

 

• Savings bonds, these are great if you do not want ready access to your money. The longer a savings bond sits the more money it earns you. You want to think about these as a long-term option.

Most people do not have the funds or do not believe they have the funds to put into a savings account. What most people do not realise is that you do not have to have a massive amount of money to get started. Most savings accounts have a small minimum deposit. Start small and with the right choices, you can watch your money grow.