Online versus in-branch savings accounts

Whether you want face-to-face service or the ease of internet banking, we've found the best savings accounts for you.

When we look for new savings accounts, the rate of interest on offer is likely to be the main deciding factor.

However, ease of use is another hugely important consideration. There's no point in plumping for a high interest account if it can only be operated online and you don't have regular access to the net.

And a branch-operated account isn't going to be much use to you if your nearest branch is actually miles away.

Here, I'm going to highlight the best savings accounts for those people who want to do all their banking online. And I'm also going point out the best options for people who want to conduct all transactions in-branch, face to face.

To keep things as clear as possible, I'll break my choices down into three savings categories: Instant access, regular savings and one year bonds.

Instant access

Best for online savers

The Citibank Flexible Saver Issue 6 pays a market-leading instant access rate of 3.3% (variable). This rate includes a 2.25% fixed bonus for the first 12 months, so you can be sure your rate won't drop below this level.

This account is truly easy access, too - you're allowed to make unlimited, penalty-free withdrawals. The main downside is that the account is only available to new customers - so existing Citibank savers can't take advantage of it.

Best for in-branch savers

When it comes to instant access accounts, people needing to bank in-branch get a pretty raw deal. The best option I've found (of a fairly poor lot!)  is the Lloyds TSB Bank Incentive Saver account, which offers a variable rate of 3.04%.

However, there are several restrictions you need to be aware of. For a start, the account isn't actually that easy to access: no interest is paid in months when withdrawals are made.

In addition, interest is only paid on balances up to £50,000. And after 12 months the account automatically converts to an Easy Saver account (the Easy Saver interest rate is currently a measly 1.6% AER).

Finally, this account is only available to people who also have (or take out) a Lloyds TSB current account.

Regular saver

Best for both

I think the best regular savings account for both online AND in-branch operations is the Regular Saver account from Norwich & Peterborough Building Society. It offers a great, fixed rate of 5% AER, and - unlike many regular savings products - you don't need to have another account with the same provider

Just remember that 1.5% of that juicy rate is a bonus, dependent on conditions: in a nutshell, you'll lose that bonus if you make more than one withdrawal during the year.

If you have dependent children, it's also worth looking at the Norwich & Peterborough Building Society Family Regular Saver Account. This pays an even heftier 6% AER (fixed), but that does include a 3% bonus which you lose if you make more than one withdrawal during the year. It can also be operated both online and in-branch.

If you want to invest more than £250 a month, the Halifax Regular Saver account is also worth a look. Again, it can also be operated both online AND in-branch, and it also pays a fixed 5% AER.

However, to operate this account you must also open a nominated Halifax savings account. And if you miss a payment or withdraw any money, the account will be closed.

One year bonds

I've stuck to one year fixed-rate bonds here, to keep things simple enough for a single article. However, if you're willing to commit your cash for longer than 12 months, you'll get a better rate with a bond lasting between two and five years. To find out more about bonds, read The top ten fixed rate bonds.

Here's my top one year pick:

Complicating factors

This has actually been the trickiest one to decide on, because there are a lot of complicating factors to consider.

The best rate for a one year bond that you can operate online is actually offered by Saga's One Year Fixed Rate Bond (3.75%). It's operated by Birmingham Midshires and can be started with a deposit of just £1. However - you have to be over 50 to apply.

The best rate for a one year bond that you can operate in-branch is offered by the State Bank of India's Hi Return Fixed Deposit account (3.75%). It has a minimum deposit of £1,000.

However, the State Bank of India currently only has a few branches in the UK's biggest cities - so for many people this isn't a practical in-branch solution.

Best for both

All this explains why I've gone for the Post Office's Growth Bond Issue 10. This can be operated online AND in-branch, offers a decent rate of 3.7% AER and requires a minimum deposit of £500.

Just be aware that Post Office Savings are not covered by the UK's Financial Services Compensation Scheme (FSCS), because they are run by Bank of Ireland.

Bank of Ireland has pledged to cover an unlimited amount of savings until 2010; if it were to go bust, however, it would be the Irish, not the British government that dealt with awarding compensation.

More: Ten tips for smarter saving | Britain's worst savings accounts!