If you're always in credit now is a great time to get a fantastic rate on your current account. As competition has increased among the banks, interest rates on current accounts have being going skywards. Abbey recently set the cat among the pigeons when it launched a new bank current account paying 8% AER gross, the highest rate on the market.

This is good news for consumers but while 8% sounds marvellous, you have to delve into the finer details to find out if it's really right for you. To lure us in, bank account providers use mouth watering interest rates to attract our attention. However, the truth of the matter is that not all of us will get paid any interest because there's a catch - you have to be in credit obviously.

Two-thirds of us have an overdraft facility and a third of us make use of it every month, according to Alliance & Leicester. So rather than looking at the interest rate on credits, youd save yourself more money by checking out the overdraft rates.

Will you get the in-credit rate?

You have to remember that there are terms and conditions attached to getting those dazzling interest rates and you may not fit the bill. With Abbey's account you have to be over 18 years old and pay in at least £1,000 a month. Students, graduates, and postgraduates need not apply as well. You'll get paid 8% on sums up to £2,500 a month for 12 months but if you need an overdraft, it's not the cheapest on the market at 16.9%. Stray over your overdraft limit and you'll get a nasty shock because Abbey will charge you 28.7%.

To get Alliance & Leicester's introduction introductory interest rate of 6.5% AER gross on its Premier Direct current account, you have to pay in £500 a month. You can only run the account online and by phone. The introductory rate runs out after a year and then you'll get the Bank of England base rate minus 1%. The overdraft rates on this account are quite generous. You get a free overdraft for 12 months of a minimum of £250 and after this period, you'll pay 5.9% for both authorised and unauthorised overdrafts.

When looking for a new account you also have to think about lifestyle. If you like to travel, Nationwide's Flex Account could be the right account for you because, unlike other banks, you get free use of your debit card abroad for purchases and withdrawing cash at ATMs. It pays 4.25% interest on credits if you pay in more than £1,000 a month and 1.25% if you pay in more than £500. The Flex Account also has a reasonable overdraft rate of 7.7% but beware, it rises to 24.9% for unauthorised overdrafts.