With the lowest Bank of England interest rate ever - it can be a real chore trying to find a savings account that pays a decent rate of interest. On the other hand, you have The Stock Market and all of the insecurities that are attached to making this type of investment. When the UK money market definitely does not seem to favour savers at the moment, what is a person to do?
By far the best type of savings account that you should always opt for is an ISA (Individual Savings Account). At the end of the day you will not have to pay any tax on your savings in such an account, as it is reconciled to your National Insurance number. In real terms, this means that you will always own at least 20% more through such an account, than one where you have to line the pockets of the tax man.
There are some accounts that are paying around the 3% mark at the moment - it is simply a matter of doing some internet research and tracking down the best one. If you already have an ISA that is paying a very poor rate of interest - this is very common at the moment - you are entitled to move to another bank or building society.
With an ISA you are also entitled to have tax free savings in the form of shares. This can prove to be the best way of maiming your income from savings.
If you are looking at investing your savings through shares primarily, never run before you can walk here. Invest small amounts to start - especially if you are complete novice in this game and make sure you have a good appreciation of the way in which the FTSE market works.
