Flexible savings

Putting some money aside whenever possible not only gives you a nest egg for the future, it's also good financial planning. We never know what's ahead of us, and having a cushion could help protect you from all that life can throw at you.

There are a number of different types of savings accounts, from online savings accounts, to instant access savings accounts and cash ISAs, available for you to choose from - and it's important to work out which one is best for your needs. Of course, you may have a number of different reasons for saving, in which case it may be worth your while putting your money into a number of different accounts - each one for a different purpose. Here, we take a look at the choice you have:

Investment account: If your plans are long term, and you don't expect to need to dip into your funds in the near future, an investment account may be an option. The money you pay into this account will go into a fund that is then invested in a number of different stocks, bonds, and other financial instruments. You can either pay in a lump sum, or make monthly payments into your account. It's important to remember though that you won't have instant access to this kind of an account.

In this era of low interest rates, investment accounts can offer better returns for your money. But they also come with the risk that you may get back less than you put in - your savings are not guaranteed. Because of this, investment accounts should be considered a long term option so they can ride the peaks and troughs of any market booms.

Fixed rate bond: If you have a lump sum you want to save and you don't plan on making any withdrawals in the near future, then you could get a better interest rate than with an account that offers easier access. These accounts offer a guaranteed rate for the length of the bond, which can be of any duration between six months and several years. You can't add to your savings or make any withdrawals during the period of the bond, so you need to be sure that you won't need the cash before it comes to an end.

Monthly savings plan: Savers who want to put away a set amount each month are likely to get a better rate if they make a commitment to do so, and don't make any withdrawals. Some accounts will allow you to make occasional withdrawals, but the interest rate in the month that you do take money out will be reduced.

Flexible bond: If you want to pay in money when you have some spare, and have access to your funds when you need them, then a flexible account may be right for you. Generally, you are able to run the account online, and some accounts will also allow you to take money out from a cash machine.

Previously, customers have had to choose between the security of a Fixed Rate Bond, and the flexibility of accessing their money through an Instant Access account, but with a Flexible Bond you can have the best of both worlds: you can save for the long term, but still access some of your money if you need it. You will have a guaranteed fixed rate of interest and can make some withdrawals without notice or penalty.

ISA: This is not a type of savings account, but a 'wrapper' that you put your savings in. The benefit of ISAs is that any gains you make are tax free, whether this is interest on cash savings or returns on investment accounts. UK resident adults are allowed to save up to £10,680 in an ISA each year, of which up to half may be in cash savings.

Barclays is a major global financial services provider engaged in retail banking (current accounts and online savings accounts), credit cards, corporate banking, investment banking, wealth management and investment management services, with an extensive international presence in Europe, the Americas, Africa and Asia. With over 300 years of history and expertise in banking, Barclays operates in over 50 countries and employs over 140,000 people. Barclays moves, invests and protects money and provides business bank accounts, personal loans, flexible bond, life insurance, a child trust fund, mortgage calculator and other services for over 49 million customers and clients worldwide. For further information about Barclays, please visit our website www.barclays.co.uk.