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Savings accounts have become less popular in recent times as more people - particularly the younger generation - seem willing to spend, spend, spend, and live for the moment. But although there is now a greater range of ways to cope with debt, putting money away for a rainy day is still the best way to ensure some security as we grow older.

In recent years Britain's debt mountain has spiralled out of all proportion, with the combined amount owed by British consumers now over £1 trillion. At the same time, various consumer investigations have shown that large numbers of people would find themselves out of money within just a few months if they lost their source of income. Together with the uncertainty surrounding the pensions system, it seems that the UK's consumers have never needed a savings plan more than they do today.

Types of Savings Account
One of the major problems for people considering putting their money into a savings account is the fact that there are so many choices. While this is obviously good from the point of view that the consumer has plenty of options, it can be somewhat bewildering and lead to the person either making the wrong choice or abandoning altogether the attempt to invest their money wisely.

What most people look at when considering putting money into a savings account is the headline interest rate - ie how much money your cash will generate in interest while it is sitting in the account. But there are a number of other factors which should always be taken into consideration.

Perhaps the most important thing to remember when considering which type of account to opt for is how long you can allow your money to be tied up for. Instant access accounts may not always offer the best interest rate around, but they will allow you to access your money immediately should you suddenly find yourself caught short. Some online accounts will allow you to establish a link between your current and savings account so that access really will be almost instant - there will be no delay in waiting for a cheque to clear. This can obviously be an invaluable benefit if your income and outgoings can be unpredictable.

On the other hand, if you are confident that you will not need your savings money in an emergency - and moreover do not want the temptation of being able to access it whenever you feel like - then a notice account may be more applicable. Notice accounts will often provide a significantly better rate of interest, but you will have to wait a relatively long time (90 days is a typical period) before getting your hands on your cash.

There also exist regular savings accounts, which offer good interest rates and an annual bonus for savers. However, one of the drawbacks of many of these types of accounts is that the bonus can be lost if you fail to make the required (for example, monthly) deposits. This generally negates the benefit of having such an account and it is therefore vital that if you do decide to go for a regular savings scheme, you are able to commit a certain amount of cash on a regimented basis.

Tax-free Savings
Probably the best-known example of tax-free savings is the cash Individual Savings Account (ISA). This device allows you to earn interest without being taxed on it, providing a very potent way of getting your money to make money. However, ISAs will only let you invest £3,000 during any one tax year, so the ability to make huge sums tax-free in a short space of time does not exist.

But ISAs remain a useful way to store some money and to build up your savings over a period of time, as while the interest rates may not look initially attractive, they can often prove far better than taxable savings accounts once the tax is taken into account. Further, laws exist which insist that anyone with an ISA must be able to get hold of their money within seven days of requesting it, making the accounts far more accessible than notice accounts.

Another option to avoid the Treasury getting its hands on any of your savings is to invest it in an offshore savings account. However, this approach runs the risk of getting caught out by an unscrupulous rogue firm, because offshore firms are not regulated and are not covered by the UK's Financial Services Compensation Scheme. This means that investing in offshore accounts should only be done after considerable and extensive research into this area.

Ethical Savings
As more and more people become concerned over issues such as climate change, the range of financial products on the market which are designed to help people lead ethical lifestyles has substantially increased.

Nowhere is this more so than in the savings sector. There are now many different products available which will allow you to save your money, safe in the knowledge that your money will not be destroying the environment or have anything to do with the arms trade. This is an area of the financial sector which is emerging as of growing importance and is likely to see more options over the coming years.

There are even a small number of banks which, rather than simply having a few ethical packages alongside their usual range, are attempting to conduct all their business ethically. One such organisation is the Co-Operative Bank, which now insists that it is working to ensure all its operations are carried out in an ethical manner.

Saving for Children
It might not sound like an easy thing to do, but persuading your children to put away some of their hard-earned pocket money at an early age can be of huge benefit in the long-term. Getting children to regularly put money aside for savings is a useful way to teach them about budgeting and also gets them into a routine that they are likely to continue when they are earning for themselves.

Many banks are also eager to catch children young and as such will offer a range of freebies to get youngsters started. From free piggy banks to special offers on certain children's products, there is always plenty for parents to choose from - although the interest rate should remain an important factor, regardless of which toy is more attractive to the child!

Since August 2002, all children born now receive a government voucher worth £250 which can be used to open a child trust fund (CTF) account. These tax-free savings can be topped up by family members as the child grows up and the scheme allows £1,200 to be invested every year. This new scheme does not allow the money to be accessed until the child reaches the age of 18, with the savings seen by the government as an investment in the child's future.

How to Save More
One of the biggest barriers to improving your savings account, however, is the fact that outgoings can often get in the way, meaning that you never have sufficient funds to put away any significant amount of money. But there are a few ways to ensure that you are able to watch your savings grow over time.

While the obvious solution is to cut down on life's little luxuries, this can be difficult to do and takes a certain amount of self-discipline. However, making a cup of tea with your own teabags in the office can be a great way to save money, rather than heading to the nearest Starbucks whenever you get thirsty. Keep the money you save in a jar at home and you'll be surprised how quickly it piles up!

Other than luxuries, there are also many other ways to reduce outgoings. One is to check your utilities bills. As everyone knows, electric and gas prices have shot up in recent years and it is difficult to find a supplier who won't be preparing to put up prices in the near future. But there are many different options out there, including non-standard plans which can offer greater flexibility and payment methods.

To compare savings products from the UK's leading providers click here.

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