While it can be tempting to borrow the money that you need to give your home a much-needed makeover, it makes a lot more sense financially to be patient and save up the money that you need. This means that you won’t have any interest to pay, and you will in fact earn interest on the money that you save, which will reduce the amount that you have to pay out of your own pocket. The amount of interest that you can earn depends very much on the type of savings account that you have, and also on how you use it.

The savings accounts that pay the largest amounts of interest are also the ones that are the most restrictive in terms of how you use the account. For example, with some savings accounts, you cannot withdraw any money from them without giving the bank or building society a certain amount of notice, such as 30, 60, or even 90 days. If you do withdraw money from them without giving the correct notice, you will have to forfeit interest or bonuses on your account.

Some accounts, known as regular savings accounts, require you to deposit a specified minimum amount every month if you are to receive the full benefit of the account. There will also sometimes be a specified maximum amount that you can put in every month. If you fail to pay in the specified minimum, you will incur bonus and interest penalties.

Cash ISAs are a type of savings account that allows you to save up to £5,100 over the course of the financial year without having to pay tax on the interest. This means that you will earn more than you would with the equivalent non-ISA savings account. While you can have more than one cash ISA account, the total amount in all your cash ISA accounts must not exceed £5,100, or you will be taxed on the excess. Again, the more restrictive ISAs tend to pay the largest amounts of interest. For more details about ISA and non-ISA savings accounts, go to the Santander website.