Researching the perfect bank account

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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