Pay off high-interest debt
Before considering which accounts to use to get the best returns, check your debt. There's little point in seeking a high return on savings if you're weighed down by a load of interest on borrowed money. Not all debt is bad (think of many mortgages) but high-interest debt is. And if the interest rate on your savings is lower than your interest rate on your debt, there is a good chance it makes more financial sense to pay off the debt first.
The United States Federal Reserve credit card repayment calculator shows, for example, that a US$2,000 credit card debt with a 19% interest rate would take 22 years to pay off if just the minimum was paid. In addition to the original sum, an extra US$4,798 dollars in interest charges would have been paid. So pay off high-interest debt first and then reduce other personal loans (such as car or holiday loans). Once bad debt is cleared, revisit your budget to get an update on how much you can afford to save each month.
Fill up those investment pools
Now scan the market for high interest rates for savings. As you do, think about your goals: what do you want to save for? A pension? A new car? The deposit for a new home? Be clear about the goals as they set when you need to have your savings available. Locking money away for five years might earn a higher interest rate but it doesn't help if you need the cash in a year. This Be Good at Money video tutorial uses the analogy of pools of savings to demonstrate a way to fill up the highest interest "pool" - or bank account - to its limit first, then allowing extra savings to flow fill up the second highest earning account. It also issues reminder to make sure the institution you entrust your savings is financially solid.
Savings products are offered by banks, insurance and investment companies and other organisations.
Many banks are part of a government-backed deposit insurance scheme (but branches of foreign banks might not be and nor may other types of financial institutions). Check with the financial regulator in your country if you're unsure and find if there is a limit to the amount of money covered by the scheme (savings can be spread between different banks so the amount insured with each institution doesn't exceed the limit).
A word on your emergency fund
Different circumstances apply to emergency savings as they need to be at the ready. If disaster or bad luck strikes, you'll likely need to be able to get to this fund fast. It's a good idea to put the money in a safe, liquid account you can always get to rather than investments that can fluctuate in value or in a product that locks it away.