Traditionally, banks offered very small rates of interest on their savings account, but of latter years they’ve been forced to become more competitive. This is due to the many alternatives that have sprung up with non-bank institutions and Internet only banks. Internet-only banks typically offer the highest interest rates and no fees - or very low fees. You do have to have another bank account to link to them, since there is no other way of accessing your money. There is no bank building to go to. All deposits and withdrawals are done over the Internet or by telephone. It takes about two days for the transfer, which is good for those who struggle with saving. It means there is that wait before they can access their money and thus they have time to think about spending it, instead of spending impulsively.

Traditional banks now also offer Internet-only savings accounts. They work the same way as above, but there are still the bricks and mortar banks from which you can access personal help or advice when needed. An electronic account in a traditional bank may not offer quite the same high interest rates as an Internet-only bank, but some people like the security that a real time bank can afford. Some electronic accounts offer even higher interest for those months when no transactions are made.

Cash management accounts usually offer better interest rates than a general savings account. They make it easy to access your money on a daily basis if this is what you need to do. Many have tiered interest rates - they give more interest for the larger balance, but really low interest for a low balance. Many other savings and transaction accounts also have a tiered interest rate structure. This is fine if you know your balance is going to be high most of the time.