There are lots of different ways to save your money, and opening a savings account might be a good option to get you started.
What is a savings account?
A savings account is a safe place to put your money away for the future. Unlike a normal bank account that you use for everyday spending, a savings account usually pays you interest.
Interest is a little bit of extra money the bank gives you just for keeping your money with them. The higher the interest rate, the more free money you get. It is a great way to watch your money grow over time.
Easy-access savings accounts
An easy-access account is one of the simplest ways to save. You can put money in and take it out whenever you want. If you suddenly need cash for a birthday present or a trip, you can get to it straight away. Because it’s so easy to take money out, the interest rates are usually quite low. You might also find it harder to save if you keep dipping into it.
Regular savings accounts
A regular savings account is a bit different. It requires you to promise to put a set amount of money away every single month, like £10 or £20. They often offer some of the highest interest rates available. This makes them brilliant if you have a part-time job or regular pocket money and want to build a savings habit. However, with these accounts, you can usually only deposit a limited amount each month, and some banks will lower your interest rate if you skip a month or make a withdrawal.
Fixed-term savings accounts
If you’re looking for a guaranteed interest rate, a fixed-term account might suit you. You get a guaranteed, higher interest rate for a set amount of time, like one or two years. This means you know exactly how much money you’ll make at the end. The catch is that you can’t touch your money until the fixed time is up. If you need your cash for an emergency, you usually can’t get it out, or you’ll have to pay a big fee.
What is an ISA?
An ISA stands for Individual Savings Account. Usually, if you make a lot of money on interest, the government can take a bit of it away in tax. With an ISA, all the interest you earn is completely tax-free.
You can open a Junior ISA from birth (with a parent’s help), and a standard cash ISA once you turn 18. For a Junior ISA, you can’t take the money out at all until you turn 18 – it becomes your money on your 18th birthday.
Money-saving apps and pots
If you’re over 16, you can open accounts with digital banks like Monzo or Starling. Many traditional high street banks have great apps, too.
A lot of these apps have a feature called “pots”. This lets you split your main savings into smaller digital piggy banks. You can name one pot “Summer Holiday” and another “New Shoes.” You can even set the app to round up your spare change when you buy something and put it straight into a pot. It makes saving feel automatic, and you might not even notice you’re doing it!
Shop around for the best deal
Every bank offers different interest rates and perks. Some might give you a free gift card when you sign up, while others might offer a much better interest rate. Take your time to look around online and compare them. Don’t just stick with the bank your family or friends use without checking others first.
Saving if you’re not old enough yet
If you’re too young to open an account on your own, or if you don’t have the ID you need yet, don’t worry. You can ask a parent, carer, or trusted adult to open a children’s savings account for you. They will manage it, but the money belongs to you.
You can also save with cash. Getting a physical piggy bank or a jar to put in your bedroom is a brilliant way to start. Seeing your coins and notes pile up inside a jar can feel really rewarding. Every little bit you save now helps you out later.
Need help?
Visit the Money Saver website for more information on how to save, and to use their savings calculator or budget planner.
Check out our Money information pages for information and links.
If you need to talk to someone to get guidance, or chat about any money worries you have, contact Meic to talk to a friendly adviser.
