Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

The MoneySaving Forum: join to chat & swap tips with other MoneySavers. Learn how in the Forum Introduction Guide

Starting Saving

Where to put your money

Want to start saving but don't know where to start? Our Savings Fountain shows you where to stash your cash first, helping you maximise the interest you earn.

In a world of rock-bottom interest rates, you need to make sure you put your money into the right type of savings account in the right order - whether that is a NISA, current account or a regular saver. We show you how it works.

Want to start saving but don't know where to start? Our Savings Fountain shows you where to stash your cash first.

In a world of rock-bottom interest rates, you need to make sure you put your money into the right type of savings account in the right order - whether that is a NISA, current account or a regular saver. We show you how it works.

Two questions before you start

1. Do you have any debts?

If you do, it's far better to pay off debts before starting to save. The interest on your debts is much higher than the interest earned on savings. So pay off your debts with your savings and you're much better off.

In some circumstances, this can apply to your mortgage as well as credit card and loan debts. If this is your case, please read the full Repay Debts or Save? guide first.

2. Do you want to save or invest?

It's important to understand the difference between saving and investing as a start point.

The Savings Fountain

The Savings Fountain is simple. Pour as much cash as possible into the best-paying savings vehicle possible. Then, when it's full and overflowing, fill up the next best, and so on.

How safe are your savings?

Bank collapse was once easy to dismiss, then the credit crunch and global market turmoil hit. The UK soon found itself bailing out Northern Rock, RBS and the Lloyds group, and the US authorities followed for even bigger bank Bear Stearns. These days every sensible saver should ask “is my money safe?".

Other ways to boost savings

There are some other fountain options.

Fixed-rate cash NISAs

Usually, a fixed-rate cash NISA is designed to lock money away for a set period. But by law, providers must allow you access to your cash, whenever you want it. But most will levy heavy penalties if you do this. 

Leaving money in your bank account

If you never enter your overdraft, leaving your savings in your bank account could earn you more than putting the money in a savings account. But you have to have the right account...

Note for non-taxpayers

The non-taxpayers' fountain differs slightly, as there's no cash NISA tax gain. Potential future taxpayers should still consider them as, if you open one now, the interest should still be tax-free by the time you start paying tax. It's a good preventative measure.

Married couples can save tax on savings

If you're married and one of you pays tax at a higher rate than the other, then make sure all the savings (providing you trust each other) are in the name of the lower rate taxpayer. This way you'll pay much less tax on the interest, saving you money. Very simple and very effective. Discuss it in the forum.

Also, remember as children are unlikely to pay tax, their accounts are an efficient place to put money in (see the Children's Savings guide).