My grandparents opened a savings account for me when I was born, and I have used it over the years to save any birthday money I got. On my 16th birthday I was allowed to access the money and was surprised to find that the original £25 that opened the account had grown into £1, 242.56!
I decided to take some of the money out to spend on clothes and new computer games and to re-invest the rest of the money in another savings account with a better interest rate so that it would keep growing even faster. This way I'd probably have enough for a holiday with my mates by next year.
I didn't know anything about savings accounts, so I visited an advisor at the building society where I had my current account. They gave me some information about the accounts they offered but also recommended that I look around to see what else was on offer. I decided it would be quicker to look online, so I visited a few websites and a comparison site to see what else was out there. I wanted to make sure whichever account I picked was better than the one my money was currently in.
It turns out that the account my building society offered had the best AER rate (the interest paid on my savings) so I decided to go back to my local branch and set up a savings account with them. I also arranged for a monthly standing order from my current account into my savings account so that some of my wages from my weekend job will be paid into my savings to help top it up. I am going to keep my money in this account for now, but I'll keep looking around to see if there is a better deal so that I get as much interest as possible - we want to go to Greece next year so I need to keep saving!
Research the savings accounts offered by five banks or building societies.
Which is the best deal and why?