The right kind of bank account can really help you build a brighter financial future. There's plenty of options available. Our handy bank accounts cheat sheet breaks down every type of account, arming you with the know-how you need to choose the best way to look after your money.
To help you out, we've created a simple cheat sheet outlining the different types of accounts available.
Bank accounts cheat sheet
| Account type |
What is it? |
Why choose it? |
| Current account |
A day-to-day bank account — in some cases for a monthly fee. |
If you need full banking facilities including Direct Debit, faster payments, and a debit card. |
| Basic account (also known as a cash account) |
A current account with limited features (no Direct Debit or overdraft facilities). Often, no credit check is required to open one. |
If you just need an account for managing your salary and making payments. |
| Packaged account |
A current account with added benefits — usually for a monthly fee. |
Only if you think you’ll use the packaged products (things like travel insurance and breakdown cover). |
| Instant access savings account |
An account that helps you save, but still withdraw money any time. Without full transactional services, you’ll normally need a current account too. |
If you want to keep savings separate from your day-to-day accounts, but want instant access to your money. |
| Fixed term savings account |
An account where you commit your savings for a set period in return for better interest rates. There are usually penalties for removing your money early. |
If you want higher interest rates on your savings, and are happy to lock your money away for a large chunk of time. |
| Cash ISA (individual savings account |
A savings account where you won’t pay tax on interest you earn. The amount you can save each year is limited. |
If you want tax-free savings, a good rate of interest, and are happy to lock your money away for at least a year. |
| Investment ISA |
An ISA where your money is invested for a potentially bigger return — but you also risk getting back less that you put in. |
If you want a way to start investing with little effort. Just make sure you understand (and are happy with) the risk involved. |
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