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Despondent about the interest rate you're getting on your savings?

It's all too easy to get depressed when just a year ago it was easy to find even easy access accounts paying over 6.5%, while the best performing fixed rate bonds were offering more than 7%.

As a rough guide, current rates are about half that now and despite inflation being lower now than it was then, it nowhere near makes up for the collapse in the earnings we make from our savings.

But regardless of how bad it all seems, it would be foolish to let your savings – no matter how little or how much you have stashed away – do anything but earn you as much interest as possible.

With that in mind, let’s look at what you can get right now - whether you’ve just £1 or £25,000

Savings pot in the back of the sofa?

Even if your savings amount to what you can dig out the back of the sofa, it’s good to know our banks won’t turn you down. Most of the popular easy access accounts can be opened with just £1 and it’s a great idea to get started even if this is all you have.

The best of the bunch at the moment is probably Citibank’s Flexible Saver (Issue 6) which currently pays a commendable 3.3% AER, although most of this comes from the inclusion of a fixed bonus of 2.25% which lasts for a year from the date you open your account.

After that, the rate reverts to Citibank’s standard variable rate (SVR), which currently stands at a miserly 1%.

But that’s the name of the game in the current financial climate. Many savings accounts currently operate fixed bonus rates. But with any easy access account, it’s simple to switch to a better rate just as soon as the bonus period expires. In fact, it’s a useful prompt for all savers – rich or poor - to get into the habit of keeping a close eye on what rate you’re getting and switch account the moment a better deal comes along.

The next best deal is probably from ING Direct which is offering 3.2%, guaranteed for a year. Bearing in mind this is guaranteed, rather than a bonus offered on top of the standard variable rate, it means you won’t have to watch for any reduction in SVR.

ING Direct also has the advantage of having an easy-to-understand website and with interest added monthly, you can watch your money grow.

Don't stand for the tricks…

A very common theme is for the best savings rates only to be offered to new customers. Don’t stand for it! Make the effort and close your existing account and open a new one – even with the same provider – if they refuse to pay you their best rate.

£500 or more

If you have £500 or more to save, you might be under the impression you’d get a better interest rate. Unfortunately, that’s not the case if you insist on an easy access account. But it does mean you have access to fixed rate bonds if you’re prepared to lock up your cash for a period.

Inevitably, the longer you put your money away for the better the rate you can expect. With the base rate at a record low of 0.5% there almost no chance of a further reduction. So the only way is up! No-one knows how long this might take but it’s probably sensible to opt for a one year bond rather than two, three or five years.

With a minimum £500, you can get a guaranteed rate of 3.7% with the Post Office One-Year Growth Bond. But if you are convinced the base rate will stay low for many years to come, much better rates are available on 5-year fixed rate bonds, even for those with small sums to invest. For example, the Yorkshire Building Society is offering 5.3% on savings of just £100 or more.

£1,000 or more

For now, those with a few thousand pounds to invest aren’t being offered better rates than those with £500. Of course this can change at anytime so it’s important to keep a close eye on the market and prepare to switch your money to a better performing account the moment it becomes available.

£25,000 or more

This is the point where things start getting a lot more attractive. There are a great number of accounts offering better rates for big savers. As always, bonds offer the best deals. But a good compromise is the Investec High 5 account. Although depositors need to give three mo>nths notice before taking any money out, this account pays the average of the five top gross rates published by Moneyfacts. At the moment, that’s 3.35% which is only marginally better than ING or Citibank’s instant access rates.

You might be wondering whether it’s worth the hassle of giving three months notice if you prefer the idea of instant access. But it’s worth remembering that when other account rates go up, the High 5 rate will automatically go up too. So this is a good account to have if you don’t want the hassle of constantly changing account in order to get a better deal.