ISA's

ISA stands for Individual Savings Account. The great thing about an ISA is that the interest is tax-free. The not so great thing is that the amount you can put in an ISA is limited to £7,000 in the tax year to April 2009.

There are two types of ISA - mini and maxi.

You can have two mini ISA's - a cash ISA of up to £3,000 and a stocks and shares ISA up to £4,000.

A maxi ISA can have both cash and stocks and shares so you can only have one.

Most ISA's are offered by banks and building societies such as Halifax or Nationwide and other Fund Managers approved by the FSA. As well as being tax free, mini cash ISA's usually offer a good rate of interest compared to many standard deposit accounts.

With all savings accounts it is wise to regularly review the current interest rates being paid to ensure that your money is in an account with maximum return.

If your money is in a non-isa deposit account and you are not a tax payer, ensure that you have filled in the appropriate forms (available from your bank or building society) to ensure that they do not deduct tax from the interest they pay you.