Your savings can benefit you now, not just on a rainy day

Making financial provisions, in the form of savings accounts and investments is often something people have every intention of achieving but will usually put to one side or never get round to, especially in times of financial uncertainty. At this time of fluctuating global markets and interest rates being at a record low for yet another month, there appears to be little incentive for individuals to look into opening an account or committing to an investment plan. Rather than being something to worry about another day or to be put on the back burner, savings should be looked upon as an opportunity to make your money grow or provide you with an income for life's little luxuries, which you may not be able to afford right now. You could also use any extra income generated to protect your home and belongings in the form of protection plans and insurance policies. The money you save shouldn't always be kept just for a rainy day.

In order to make sure you choose the best account possible, it is worth examining the many different options on the market. Many high street shops and general stores offer financial services and you no longer just have the option of a standard plan offered by your bank or building society. There are many ways to see a great return on your money, either in the long term or on a more regular basis, and you need to be aware of the many different choices out there.

For long term savers, an ISA can offer a good return. Most people who have savings in a bank or building society will pay income tax on any interest earned over the year. Cash ISAs allow you to save up to £5,340 in one tax year and you will not pay tax on interest accrued from your money. If you are planning to save a large amount over the year, the fact you are not paying tax on that money, as well as a decent rate of interest, could well lead to you seeing a better return than paying into a high interest account. Alternatively, you could pay into an investment ISA - the threshold for these is higher than a cash ISA and is linked to the performance of the stock market, meaning returns can go up as well as down. There is nothing stopping you having one of each, and therefore having a maximum threshold of over £10,000 in a tax year, but you must be aware that you are limited to the amount of money you can place in ISAs in any one tax year. Some investors will use them when it comes to savings for children; currently the government allows savers to pay up to £3,000 into a children's ISA, meaning this is a great way to provide children with a nest egg for later life. A personal financial adviser or your bank will be able to help you find the best deals that will suit your needs.

Regular savings accounts enable consumers to deposit money at set periods throughout 12 months. This is one of the most common options available to consumers but will often provide a limited return in terms of interest earned over a year. Most regular savings schemes restrict access to the account holder's money and may not let you pay in extra funds should you find yourself in a position to invest extra cash. Though the interest rates offered can be quite attractive, it is worth remembering that interest is only paid on the amount in the account at any one time. If you are only paying in £100 per month for example, you may not see a great return over the year.

On the other hand, an instant access account allows flexibility for the saver in terms of what they pay in and when they can withdraw their money. You are often issued with an ATM card and can access your money 24 hours a day. Flexibility does come at a price though, as many of these accounts will offer a lower rate of interest on savings.

A notice savings account will require you to give an advanced request if you wish to withdraw funds from your account. Often a bank or building society will require between 30 and 90 days notice before a withdrawal can be made. It has often been the case that this type of plan offers higher interest rates than other schemes, but it is worth doing your homework to make sure you are benefiting from this higher rate. Banks and building societies will often offer variable rates of interest to entice new customers, so it is worth keeping an eye on these rates and moving accounts if the rate fluctuates.

An attractive alternative to more conventional investment plans is to place your money into bonds. These come in a variety of forms and will allow you to save as much or as little as you want; depending on the type you opt for, they will often allow you instant access to your money or the option to tie it up in a longer term investment. Though bonds are often accused of not offering the best returns in terms of savings interest rates, their security and stability make them a popular option for investors.

If you are still unsure about your options when it comes to investments, your bank manager or a personal financial assistant will be able to point you in the right direction. Spending a few moments using a reputable price comparison website, which will allow you to compare the best interest rates on offer, can really help you find the best plan. The extra money you could generate will always be useful when it comes to the things you are passionate about - you may want to treat yourself to a little something for the home or even look after the existing possessions than are closest to your heart.