Premium Bonds - A Worthwhile Investment or a Waste of Time?

by , 9 Jul 2009

Find out exactly what premium bonds are and whether they're worth investing in.

Treasure Chest

What is a premium bond?

A premium bond is effectively a savings account from NS&I (National Savings and Investments), into which you can deposit between 100 and 40,000.

What makes premium bonds different to standard savings accounts is that instead of earning interest on your invested money, you enter a monthly prize draw, with the chance of winning between 25 and 1million.

The chance of winning a 1million jackpot has made premium bonds hugely popular with UK savers, ever since they were first introduced in 1956. But just how likely you are to win big with these bonds, or indeed win anything at all, is worth questioning.

How do the prize draws work?

The prize fund for each month's draw is determined by an interest rate applied to the total bonds held. Until July 2013 the prize fund was set using an interest rate of 1.5%, with the chances of winning one of the prizes at around 24,000/1 per 1 bond.

Since 1st August, the interest rate used to calculate the total prize fund dropped to 1.3%. This reduced the number of prizes available in each of the Higher, Medium and Lower value prize bands, meaning your odds per 1 bond are around 26,000/1.

Otherwise, how the prize bands are built within that fund remained the same: see the NS&I website.

How does a Premium Bonds account work?

If you open a premium bond account you are able to invest between 100 and 40,000. In return you'll receive the equivalent amount in bonds. For example, if you invest 100, you would receive 100 1 bonds. 

You can buy bonds online from NS&I over the phone, at the Post Office, or with a regular monthly payment by standing order. Anyone over the age of 16 can buy them, or they can be purchased by parents or grandparents for those aged under 16.

The bonds each come with a unique number and are put into a prize draw a month after you've bought them.  They will be re-entered in each subsequent draw until you decide to cash them in.

What are the benefits of investing in a premium bond?

In times of banking instability, you may be comforted to know that investing your money in a premium bond ensures that your money (up to the 40,000 maximum investment) is completely safe. This is because NS&I is backed by HM Treasury. Also, your capital itself is not gambled in the prize draw - only the interest that you might have earned on that capital.

Another thing worth noting is that there is no minimum length of time that you must hold the bonds. You can cash them in any time you like from the time you invest, although new bonds can't be cashed in for a month after they are first purchased. Also, it will take up to 8 days to withdraw the money after you have decided to cash in.

If you do win a draw, any prize money (from 25 to 1million) will benefit from tax-free status. You may opt to re-enter your winnings into the draw in the hope of winning even more, an idea which is supposed to imitate the compound interest you would get on a standard savings account (the interest earned upon interest over a year).

What's the catch?

Unfortunately, the many catches of investing in a premium bond arguably outweigh the benefits. Firstly, it's worth considering exactly how likely you are to win in the monthly prize draws.

Of an average 40 billion bonds entered in the prize draw each month, the prize ratio works as follows:

  • Around 1 million bonds are awarded 25 prizes
  • Around 20,000 bonds are awarded 50 or 100 prizes
  • Around 2,700 bonds are awarded 500 to 1million prizes
  • Two prizes of 1 million each for 2 bonds from August 2014

This means that your chances of winning the top 1million prize are about 40 billion to 1, odds that make a jackpot win at the National Lottery seem a sure bet in comparison (around 14 million to 1).

Another thing that should be taken into account is that although your invested capital is safe in a premium bond, inflation means the value of that money will go down over time - and with no interest earned to offset that loss of value you'll effectively end up with less than you started with.

The NS&I refer to any payouts as 'wins', the lure of which can be very attractive to those wanting to earn some money back on what they invest. However you are likely to win less than the interest earned on a standard savings account, which could be around 2-3%, so you may be much better off investing your money in a top savings account or tax-free ISA instead.

These will enable you to earn money on what you invest and will pay you a better return than the average you will get back from premium bond wins. You could even think of the interest paid on your savings as a 'win' in itself - and one that is guaranteed to be paid out to you on a regular basis.

The premium bonds are described on the NS&I site as 'an investment which offers the fun and excitement of a chance of a big win.' However you should remember that premium bonds are government-backed products that help to generate government funds, so it is understandable the NS&I would want to sell them to the public in this way.

In general, premium bonds aren't really worth considering in terms of a realistic return on your money. Although there is a chance that you could win big, this chance is negligible at best.

If you are a higher-rate taxpayer and have already used up your tax-free ISA allowance, perhaps these bonds could suit you - if the chance to win prize money is more important to you than earning a guaranteed return on your money. But for the majority of savers who want or need to earn interest, a top-paying savings account is likely to be a better option to take.

In this way, premium bonds should be seen not as a viable savings account or investment, but as a way to forego earning interest in favour of gambling that interest on the chance of winning money.

Responses

add your response here

I have had 20 Premium bonds since they started I am now 75 years and have never won a penny, so what this article is saying is spot on 40million to one odds says why we have little chance. I will still leave them in. I have had the best growth from ISA,s but you have to take the risk. Over time they rise in value I find.

by johnHussey, 15 Jul 2009

I have found that cashing in bonds that have never won prizes and buying new ones has produced the odd win in a short time scale.

by oakwoodbank, 15 Aug 2013

well, i have won £125.00 this year (and the year is not out yet) so far and that is more than the interest i would have got on an isa. with £25,000 invested.

by lassy, 3 Oct 2013

that's not right , Lloyds did an isa last year 3.7% at £25000 is equal to £925 so I think you need to shop around my dear!!!

by lancaster666, 19 Oct 2013

I am very switched on with low risk investment and shop around a lot for good rates there are many at 3% at the moment so bonds are actually not a good investment and its only the thought that you may win big that keeps you here I have bonds but will only invest for 12 months then get out you could earn £720 a year on £30000 in a current account at Santander and an isa is also a good deal .

by lancaster666, 19 Oct 2013
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if you can bye ?100s worth then cashin your ?20.

by gmac, 20 Jul 2009

I need a strong brandy

by toto51, 1 Aug 2012

that guy has waited 75 years .....take your money and buy a strong brandy

by toto51, 1 Aug 2012

I do understand that not cashing in the bonds! I bought £10 worth in 1978, thinking it was an investment account. I am a nurse and that was my overtime funds. I have never won a penny! Yet, I am told of people who have won small sums more than once.

by mefkit, 3 Sep 2012

If you can afford to leave your money in bonds that's fine because your money is safe,,. But and I say again But,,.your chance of winning a big prize in bonds at 40billion to 1 to coin a well known saying you have!nt got a dogs CHANCE, .

by Unclelen, 26 Sep 2012

Do the maths. Own 1000 bonds and your chances are 40million to 1. Own 4000 bonds and it's 10million to 1. Better than the lottery and you still have your stake for the next draw. If you don't win, buy more!

by winner1973, 15 Mar 2013

With Premium Bonds you lose nothing, and have a `Hope & a Prayer`of a win.
The Lottery is a gamble if you can afford to lose.
ISA`s are the most likely less long term gamble (15 yrs.) to show a worthwhile return

by jsemor, 5 Jun 2013

don't forget they loose 5% a year in inflation

by lancaster666, 5 Nov 2013
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Interesting article .
But are they really worth a gamble ?

by nadge, 26 Sep 2012

The chance of winning phrase '41 billion to one' assumes you only hold one bond, so is very pessimistic. Assuming a person held the maximum holding of 30k, the odds of winning the jackpot would be 41 billion divided by 30,000. So, the odds would become 1,366,666:1 (just over one and a third million to one) - much better than 41 billion to one.
Also, as there is currently 41 billion invested in PB's between 22 million people collectively, this means the average holding is 41 billion divided by 22 million, which comes out to 1863 PB's as the average number of PB's to each person. Therefore, in round figures, unless you're investing £2000 or more in PB's, you might as well invest in a bank account, as if you hold less than the average number, you will on average, have less than average luck. So, in my opinion, anyone looking for a flutter on the Premium Bonds needs to be putting in £2k or more.

by Bounty_Hunter, 16 Oct 2012

I might have the maths wrong but isn't it 41billion - 30000? ie still c 41 bbillion

by ammonite, 19 Oct 2012

It's 41 billion / 30,000

by andymic, 21 Oct 2012

It seems to me the only winners are the gov, dont waste your money on these bonds, get a good savings acc, or buy gold.

by peasnbarley, 12 Nov 2012

Don't give Corrupt.Gov. ANYTHING !
They rob us all enough as it is !

by nadge, 9 Jan 2013

Given that interest on savings accounts is derisory, and your capital is safe in PB's, I don't think they're that bad a deal.

by Feline123, 9 Jan 2013

peasnbarley should be peabrain, there couldn't be a worse time to BUY gold as its at a premium?
Exactly Feline123, and unlike the lottery you get chance after chance and still get your money back whenever you want it.
There really are some Numpties on this forum?

by nacenet, 30 Jul 2013

It is a risk free gamble if you can afford it !!!

by fishgem, 15 Aug 2013

Best go to the Bookmakers.

by dmcgov, 10 Dec 2013

My father gave me a £1 bond for Christmas in 1958, I haven't won anything, but am thinking of buying more.

by Annia, 4 months ago
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My wife bought a single £1.00 Premium bond on 15th. August 1958 at London's Euston Rd. Post Office, without a single win up to date. Can anyone beat that?

by tallin, 6 Dec 2012

Well , I've never had any , and to date have won nothing !

by nadge, 6 Dec 2012

My late father bought £5,000 in bonds and in the first draw he got £1,000 and two months later £100. He died about four years later and won the month after he died and then just before they had to be cashed.

by badgerboy, 13 Dec 2012

Mum bought 30,000 for my boys last month and won immediately.
£500 a month, bets sod all from a bank!

by fatboymark, 2 Jan 2013

I invested 30,000 four months ago and have won 2 lots of £25 for three months in a row (ie, every month they have been eligible for a prize, £150 in total). It is exciting to think that each month I may get an email from my good friend ERNIE alerting me to another win. Of course, I would have to keep winning at this rate to match a gross 3% interest rate, but one substantial win would do a lot better than that and it's much better than the Lottery as I don't lose my stake!

by petersme54, 5 Jan 2013

Ernie has continued to come up with good news for me. I have now won FIVE months in a row, 2 x £25 on four occasions and 4 x £25 on the other. By putting the winnings int a 2.9% (one year) savaings plan, this is matching the better interest rates and also keeps me in with a chance of winning a much bigger prize.

by petersme54, 8 Mar 2013

I can beat that Tallin, my grandmother bought me a pound premium bond in march 1957 when i was born and ive never won anything either.....ps, also a pound was worth a lot more than it is now!

by sullysmum, 6 May 2013

I live in New Zealand. Both parents have passed on. Just discovered two 10 pound bonds they bought in 1977. Checked the numbers and found that one of them has won 50 pounds. Does the prize compound into more bonds??

Alan NZ

by alanwar10, 5 Aug 2013

Are Premium Bonds transferable after you die. Can you leave them in your will?

by sbooth282, 11 Aug 2013

I don't think that they are transferable sbooth282. When my Dad died he had told my Mum that he wanted the cash refunded from the £20,000 worth of bonds to be shared between us 4 children as they could not be transfered. He did have quite a few small wins in the 20 years he held them but never anything major.

by Dollychris, 11 Aug 2013

That's right, Dolly. They can be cashed in and will form part of your estate, but they can't be transferred into another name.

by Feline123, 11 Aug 2013

Forty one billion divided by two thousand is twenty and a half million.

by johntob, 28 Aug 2013

And......

by Feline123, 28 Aug 2013

I was thinking this means if I have two thousand bonds, one of my numbers has a twenty and a half million to one chance of being picked out of ERNIE's hat?

by johntob, 28 Aug 2013

that must be really disappointing nadge.

by ian123, 11 Jan 2014

My grandad won 1million with a £28,000 investment when he was 38 now he's 72 and lived on it happily ever since and he set one up for me on my 16th birthday for 30,000 (his only grandson) and I've won £2,325 altogether I'm 19 and soon will be having my own child and I will put £100 in every year for him so good luck to anyone who has just bought bonds they are great

by Tomm12345, 12 Apr 2014

that was a nice win tomm. what did he win it on?

by ian123, 12 Apr 2014
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Don't forget the bonds are better than the lottery ! With the lottery you have abet then you lose your money !! It does not go into the lottery again and again and again and you can still get your mone back !!!!! Premium bonds are for me !!!!
Tony

by chefto, 3 Jan 2013

We just started with 30k 3 months ago and won 150 quid so far
C

by vazon, 4 Jan 2013

and of course, if you win early on in the financial year, you can then reinvest in a savings account and earn additional interest

by petersme54, 6 Jan 2013

I keep £18000 in bonds and won a few £25 prizes last year totalling £225. Knocking at the big prize door is how I view it.

by alan_2, 7 Jan 2013

I agree! And welcome to the Forum, alan.

by Feline123, 9 Jan 2013

the fun of bonds is waiting for the post man to turn up and opening your letter only to be disappointed that its only £25!!!!! I love that feeling of money money money and then nothing !!!!!!!!!!!

by lancaster666, 19 Oct 2013
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I have recently found a premium savings bond for £1.00 which my parents took out for me in 1958 shortly after I was born. I guess at the time that was a sensible thing to do, rather like a childs trust fund now, and £1.00 then is worth about £20.00 in todays money, although I'm sure it represented a bigger value then for them. Anyway, 54 years down the line...........nothing! If they had invested £1.00 in a savings account for me when I was aged 1 year I'm certain it would be worth more than £20.00 now, especially with the years of high interest rates.............oh well! maybe I will have a win before I'm 85!!

by jackie56, 9 Jan 2013

Well I hope you do , Jackie !

by nadge, 9 Jan 2013
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My Husband and I do not have the full amount allowed, however, we have won small amounts most months - having said that - bet we won't this month ! BUT is there anyone on this blog or someone you may know who has actually had a very large win ? I would love to know if there is hope of that happening......by wantalot

by wantalot, 2 Feb 2013

I retired a little while ago and the staff i used to work with won the million a few months after I left. How gutted was I just goes to show you have to be in it to win it

by dogman10, 21 Mar 2013

ooooh...I'm prepared to be patient a little longer then - sorry you missed out there though - my sort of luck too ! ! oh..and I did win again that month but nothing I could retire on. What am I like? I,m already retired!! wantalot

by wantalot, 1 May 2013
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It does seem that my £30000 investment is becoming a waste of money. I now seem to regularly miss months, and the wins are generally £25. When I first bought my bonds, I was winning regularly £50 and £100, even £5000, but that seems a long time ago. I am now considering a more lucrative investment.

by superpete, 8 Mar 2013

In 1979 I held the 13 bonds I'd had since birth 11 years earlier. I won £1000. In the early 90's when the prize fund was bigger I was averaging 11% return (tax free of course), and just this last few months whilst we're between houses a £60k chunk of our 'deposit' has been returning an average of £60/mth which beats the 1% gross rate of interest in a bank and also still gives us that 60,000 in 40 billion = 1.5 in 1 million chance of winning the big one, quite a lot better odds than the lottery and the comment above would have you believe. If you don't win, buy some more bonds... it's not like you're really spending it! Also, don't forget that once your £2 on the lottery has had it's chance and lost, it's gone. Not so with premium bonds as you can just wait for you chance the following month at no real cost

by winner1973, 14 Mar 2013

I invested 2,000 pounds in premium bonds and have won over double the investement... If you don't win, cash in and re-invest.

by bone, 16 Mar 2013

the rate for calculating prizes is 1.5% which makes them highly competitive against most instant access savings accounts this article is badly flawed comparing with the lottery where the stake is lost a £1 bond is entered indefinitely and is therefore massively better odds than the lottery at 24,000 to one every month until cashed in
obviously you forego a guaranteed but currently pathetic rate of interest but in return you get the chance of receiving from 0% to 1000000%
my personal experience over 9 years is an annual equivalent of just over 8% which is well above any high street rate and nearly all long term investments plus the capital is 100% safe and instantly accessible and tax free

by mark75, 12 Apr 2013

The National Lottery being " a sure bet in comparison" what about the fact you don`t get your stake back if it`s not ?? J W

by jaywil, 15 Apr 2013

Quite so, jaywil!

by Feline123, 1 May 2013
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I've won over £1700 over 10yrs with a holding of £8000 bonds. the biggest win being £1000 back in 2002. All bonds have been automatically reinvested so my holding is now £9700. I have from time to time been looking to move them to a savings account or ISA, but rates are abysmal so I've left them in for now. I don't know if the money would have been better off in a savings account or not over the same period, but fortunatley it's money I don't need to access right now, so I'm happy to continue gambling!

by marcus999, 1 May 2013

I agree, marcus!

by Feline123, 1 May 2013
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We have been in Premium bonds, since 1986, and only once won a half decent price 1000 pounds. Never 500. Now quite steadily 25 Pounds which amounts to a little less than interest. They claim that the more you place in the fund, the better your chances. This does not seem to be so. How come you never see a 25 pound, a 50 bond , and very rearly a 100 pound win a prize, and yet there have been thousands of these low value bonds given out every month over many years. It really makes us feel there is a selective team deciding who is allowed to win.

by clbead, 5 Jun 2013

I'm sorry, clbead, but that is not the case.

The winners are picked by a computer and it's perfectly obvious that the more entries you have, the more chance you have of winning.

Do you really expect us to believe that there are people sitting in an office saying, 'I don't like that person so we won't let them win'?

Get a life.

by Feline123, 5 Jun 2013

`ERNIE` is his name (the computer that is)..and the current odds of winning is 24000-1 per bond...Minimum purchase is now 100 bonds, and you can always get your money back.. It is common sense that the chances of winning is increased with the more bonds you have.

I note that one subscriber admitting that she has never had a premium bond,wonders why ERNIE has never sent her a cheque `Eyes Roll`

by jsemor, 5 Jun 2013

Lol, jsemor!

by Feline123, 5 Jun 2013

i have £22 in PB's, £2 i bought in 1960 and £20 in 1967, i've had 1 win of £25 that i know of, all i need to do now is find them to check if i've won anything else as can't remember if i updated my address when i last moved, as for cashing them in can't buy a lot for £22 these days but if i hit one of the big prizes that would be a different matter lol

by paul38, 5 Jun 2013

You can check and update your details at the NS&I website, paul, and also check on any unclaimed prizes.

Am I on commission if you uncover an unclaimed million......?

by Feline123, 5 Jun 2013

hmmmmmmmmm got to think about that, and i've got to find them first 123 as i don't know the numbers lol

by paul38, 5 Jun 2013

I'm sure they'll find them from your name and previous address, ;-))

by Feline123, 5 Jun 2013
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To get a true representation you would have to invest £30,000 into a cash ISA and then use the interest earned to buy Lotto tickets, that way your capital is not at risk the same as a pemuim bond.

So if you had £30,000 in The Cheshire BS cash ISA @ 2.5% you would be able to buy £750 worth of Lotto tickets or about 65 a month.

The only differnence is that you would only have to wait two months before it starts to pay on premium bonds unless you have a cash ISA that pays your interest monthly then it is a one month wait to start on the lotto. However if you save the lot untill the end of the year and bang £750 into a rollover the odds of winning are greatly increased. Don't use lucky dips though as you may get the same number twice with such a large amount!

by bungas, 5 Jun 2013

With respect Bungas, I think your probabilities and your odds are a little askew here. If you invested in the lottery with your 750 pounds, you are looking at odds of about 1 in 60 of getting 3 numbers (£25). Let's assume the odds are spot on, you can afford 325 tickets, so at 1 in 60 you can hope to get 5.4 winning lines. Let's optimistically round that up to 6 and you are looking at a return of £150 in total from your £30,000. That's 0.5%.
Sticking with an odds-based approach, you have an approximately 24,000 to 1 chance of winning each month with the premium bonds, so all things being equal, if you hold 24,000 bonds you should win £25 per month at least, which is £300 per year, or 1.25% (obviously if you invest 30K your odds are higher but your % return also adjusts commensurately, so let's assume it's still about 1.25%). So actually in terms of your investment, you are better just getting an ISA paying 2.5% and then keeping/reinvesting the interest (not that there are any paying that that I can see as of 06/01/2014). If you are willing to sacrifice some interest for the (fairly remote) possibility of a higher return, then Premium Bonds are a much better idea than spanking your interest on lottery tickets.
As a final point, the odds of any one line of numbers coming up in the lottery are about 14,000,000 to 1. Buying 325 tickets using lucky dips means that the chances of getting duplicate numbers are the same as those of winning the jackpot, so I wouldn't waste your time hand selecting 325 individual rows. In fact, buying 325 lottery tickets is a waste of at least £748, given that you end up with almost exactly the same chance of winning, in real terms, as you do if you buy 1 ticket.

by Batman2504, 6 Jan 2014

Thank you for your great posting Batman have only just seen it.

by Sabre, 17 Apr 2014
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I have £800 in pb. Haven't won anything to date. Not even a small prize, though I think if your not in you can't win so I'll keep investing more each month & keep my fingers crossed that someday I'll win something!

by j3goodluck, 6 Jun 2013

They're not a bad investment with interest rates so low, but I'd advise you to look again if rates ever go up.

Hope you win something!

by Feline123, 6 Jun 2013

I also hold an isa account with them so putting money in both each month :)

by j3goodluck, 6 Jun 2013

Clever girl! Best of both worlds.

by Feline123, 6 Jun 2013

Your all mad, the pound will continue to devalue, we are in negative interest rate times NOW......2% on Isas what a joke....

by tim46, 8 Jun 2013

Hi tim, and thanks for that constructive comment about our sanity.

by Feline123, 9 Jun 2013

Tried both their bonds and ISAs, they say I'm already registered and the farce of getting a new password, cos I've lost the old one, literally takes weeks, had me abandoning the entire banking side and sticking with ERNIES

by johnh28, 9 Aug 2013
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I've had 2 bonds since 1972 not won a penny

by Baggers, 8 Jun 2013

Must not have much in your bond

by TommyB123, 4 Apr 2014

I've held £6,500 in PB's and average £75-£100 per year in wins.

by Kevthegerbil13, 8 Apr 2014
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I know someone that has won £25,000 on £20,000 bonds kept and also someone that wins every month who has £30,000, she has won £5,000 and around £25-50 a month. I have around £9,000 and win £25 about every 2 months. The fact of the matter is that you have to be in it to win it!

by Frank2013, 11 Jun 2013

I know some one that won a six figure sum on the Lotto too! I'm happy just to be content to have a regular income from investments.

by bungas, 11 Jun 2013

I agree with your previous post and have been thinking along the same lines of investing and putting the interest on the lotto but mainly on Hotpicks, 2 numbers pay £40 and 3 pay about £450 and so forth. Better odds and more of a chance of winning something.

by arfer91, 4 Jul 2013

one thing I did hear you should sell them every 2 years and then buy them back for some reason it produces more wins !!! apparently

by lancaster666, 19 Oct 2013

oh and I don't have ginger hair !!!!!and burn like a lobster in the sun

by lancaster666, 19 Oct 2013

That thing about selling them and buying them back is rubbish. Firstly, you will lose at least one month of being in the draw, and secondly every number has the same chance of wining no matter how new or old it is.

by Feline123, 5 Nov 2013
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With interest rates so pathetically low on fixed rate saving bonds which provided a monthly top-up to my pension, I am using ERNIE as a holding bank, with the chance of a win, until interest rates rise again. Another advantage of ERNIE is the ability to cash-in in case of emergency, something you are unable to do with the majority of fixed term, fixed rate, bonds

by johnh28, 25 Jul 2013

sorry but I get a good rate on bonds just had one at 3.7 which is far better than the premium bonds which I think is as low as 1.6 shop around john 28

by lancaster666, 4 Nov 2013
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with the poor rates of return these days I'd rather take a chance on winning, my 3k might earn me £60pa but gamble that £60 per year and you could possibly end up with a lot more than £60, long odds maybe but someone has to win it and you never know you could have more than one win a year even small wins would offset the pittance you get from the banks!

by nacenet, 26 Jul 2013

You got to be in to win

by Baggers, 26 Jul 2013

Hello there baggers ! I am in to win it.....however my chances are now shrinking as they've announced another CUT in prize money.
Should I buy another £2,000 to keep my chances on course ? They now say the 24,000 to 1 has become 26,000 to 1 - please advise.

by wantalot, 27 Jul 2013

Can't say for sure you need one of our experts to advise

by Baggers, 27 Jul 2013

Hoping not to offend by posting a link to a rival site, but there's a Premium Bond calculator on moneysavingexpert.com

by Feline123, 30 Jul 2013

Tickety boo feline rock on

by Baggers, 30 Jul 2013

Will do, Baggs!

by Feline123, 30 Jul 2013

Yeh just rock the house down feeling fine feline!!!!!

by Baggers, 31 Jul 2013

bottom line its a risk you may win or not but you will always have your investment but remember you will loose 5% a year due to inflation so after a year if you don't win look at something else or your money will slowly disappear infront of you

by lancaster666, 4 Nov 2013
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ive had mine since 1971 an not won anything !!!!

by sambarb20, 9 Aug 2013

sell x

by lancaster666, 4 Nov 2013
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If you think your number is lying at the bottom of the pile, like the hospital waiting room, you could always cash them in then apply for a new batch. On the other hand it depends on the amount you hold, the more you have the better the chance.
Wish they would raise the holding limit

by johnh28, 9 Aug 2013

If you do that, john28, you will have to wait a month for the new batch to go into the draw.

by Feline123, 11 Aug 2013
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Uncle Ernie has given me pocket money every single month since November, totalling £900 for the £30,000 investment in ten months. Beats most risk-free savings offers available and keeps me in the hunt for the £1,000,000 each month. I am expecting fewer wins in the coming months, but very happy so far

by petersme54, 11 Aug 2013

ichavehadabondforaround43yearsbutonmovingaroundilostitisitpossibletogetareplacement

by rocar, 11 Aug 2013

punctuation needed!!!!!!!!!!!!!!!!!!!!!!!

by lancaster666, 4 Nov 2013
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They're only worthwhile if you have a large amount of them,otherwise not really worth having

by bigpops, 11 Aug 2013

yes don't bother with small amounts 30k or nothing . that will probably give you a win each month but usually a £25 not good interest but always chance of big one . the stock market could also be a long term investment .

by lancaster666, 4 Nov 2013
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Premium Bonds belong to the 21st Century and I for one don't waste my time thinking about them as potential investment.

by creativesaver, 11 Aug 2013

But this IS the 21st century, CS!

Mine are returning more than a savings account would at the moment so I'm happy, and I can get hold of the cash at any time, should I ever need it.

by Feline123, 11 Aug 2013

I meant it belongs to the 20st century. It is so outdated!

by creativesaver, 11 Aug 2013

Sorry, CS!

I know you have to have reasonable luck to make a reasonable return, but there's always the prospect of winning a big prize.

And, unlike the lottery, you get a free entry again next time, and the time after........

by Feline123, 11 Aug 2013

I bought premium bonds in 2006 which i think was the 50th anniversary of the draw and have 10k in all,ive won mostly 25 pounds a few 50s and a few 100s,nothing substancial yet this as ammounted to neally 1000 pounds in winnings,id say it i worth investing but i havent had a win for sometime now but the hope of hitting the jackpot or a big win fills me with excitement,at least with these you never loose unlike the lottery which i have been playing the same numbers since 1994 but on had four numbers about 5 times,we all live in hope.

by retroboy19, 1 Sep 2013

Welcome to the forum, retroboy!

by Feline123, 1 Sep 2013

With my luck if I'd have been one of raquel welshs triplets I'd be the one in the middle on the bottle!!

by Baggers, 9 Oct 2013

don't forget you will loose 5% a year due to inflation if you have 30000 in a year it becomes the value of £28500 so even if you win £1000 a year its still going down hill. isa is good but generally keep saving all the time to keep head above water or money becomes worthless!!!

by lancaster666, 4 Nov 2013
add a comment

I've got 12000 bonds and I win every month

by joshuaw72, 27 Sep 2013

I put any income tax I owe between April and the following January into Premium Bonds. The money belongs to the tax man anyway so I just have fun playing with it before I have to hand it in

by abanaz, 27 Sep 2013

i think they are a waste of time. even holding the maximum amounts gives no guarantees of winning an amount equal to the lowest paying interest account.
whenever interest rates dropped,so did the prize fund.

by ian123, 3 Oct 2013

I wouldn't say a waste of time but its a gamble and only invest money that you have spare and don't need an income from the interest . isa . fixed rate bond then premium bonds

by lancaster666, 4 Nov 2013
add a comment

Just invested 30k in Sept and had my first win of £25 the very next month, Oct, so very encouraging.

by Ceeaitchjay, 9 Oct 2013

Good for you, CHJ, and welcome!

by Feline123, 9 Oct 2013

I've got 2 pounds worth feline and never won a penny bought in 1974 when I was just 15

by Baggers, 9 Oct 2013

Nice present for grandchildren to share.
Toys are not played with for long and expensive.
The occasional alternative.

by martini97, 9 Oct 2013

Good thinking, martini. The kids can't grow out of premium bonds!

by Feline123, 10 Oct 2013

Well, I can't afford 30,000, but I could manage 5,000. Is it worth it? Still mulling it over. Have had 10 for many years and never won a thing.

by jengra, 18 Oct 2013

Hi, jengra, and welcome.

If I were you, I'd have a go. Your capital is safe and you can cash it in at any time. And with savings rates the way they are the loss of interest is almost negligible so, even with a small win, you would be making a profit.

by Feline123, 18 Oct 2013

Feline brains and good looks

by Baggers, 19 Oct 2013

Thank you, lovely Baggs!

by Feline123, 19 Oct 2013

you guys need to shop around there are plenty of high street banks doing 3% at the moment I am even getting 4% on some accounts, you need to ask more at your bank they don't always offer everything

by lancaster666, 19 Oct 2013

I have bonds but they are only running at 1% at the moment so looking at selling and maybe reinvest later if rate picks up

by lancaster666, 19 Oct 2013

Won £25 four times this year on 1OOO bonds so going to increase my chances even more while interest rates on investments at an all time low!!

by johnma34, 24 Oct 2013

So reading all these posts, it seems that if you are in the lucky position of being able to spank £30,000 into Premium Bonds, you are likely to regularly win small amounts.
I have had £4,000 invested for over five years and won nothing, not a sausage. l have friends with the maximum £30,000 and they often win £25.

by doghouse321, 1 Nov 2013

yes I am rich

by lancaster666, 4 Nov 2013

if people in general didnt waste money on flash cars holidays and general rubbish they could have 30000 to invest in premium bonds I live well below my means and that way I can save ... no credit cards for me!!!!!!!!!!!!! and when I get to 60 I will spend like I have no tomorrow and enjoy my last few years in style and expensive meals out . saving is easy its adverts and other people who spend your money think of all the rubbish we buy and what do we actually NEED we just need a bit the rest is for showing off !!!!!!!!!! look at me !!

by lancaster666, 4 Nov 2013

Well yes you could do that. The state pension is a waste of time,we will sell our house and buy a smaller one to raise some cash if we are still around at age 60.

by doghouse321, 5 Nov 2013

Doghouse are you always in the doghouse

by Baggers, 5 Nov 2013

Hi Lancaster666. 3 months ago you mentioned getting 4% interest on some "accounts". Was that on investments blocked on a long-term basis (eg: 3 years or more)? Could you pls tell me where you got 4% and is that rate currently still available? Many thanks.

by cleverfox, 19 Jan 2014
add a comment

im thinking of buying £100 worth of bonds just to be in it. see if i can win anything. any comments.

by stevec36, 10 Nov 2013

Well you got to be in it to win it as they say Steve

by Baggers, 10 Nov 2013

Its interesting to read the winners list, although most people who win do hold lots of bonds, the actual value of the winning bond is £5000. I use premium bonds because I can take out and put in as and when I want. I currently have £5000 invested in parts over two years. Would it be worth withdrawing it and reinvesting it as a whole amount?

by foxy_m, 4 Dec 2013

Don't forget that if you do that, you will have to wait a month for the new ones to go into the draw, so you will lose a month's chance of winning.

by Feline123, 10 Dec 2013
add a comment

I put £30000 into a medium risk portfolio 4 yrs ago at a cost of £925 plus on going fees .After 4 yrs of worry and sleepless nights and 2 rows with my F A i now have £24000 !! Even if i still had my initial investment plus £1000 profit it wasnt worth the agro. So i am now putting the lot into premium bonds and taking my chances. At least in 20yrs time i will still have £24000 albiet with reduced spending power but i will buy salmon spread instead of caviar but at least i wont starve as a pensioner in fact i may have clocked up many small wins in the meantime ! PBs are boring but safe. At least i wont have 20yrs of high blood pressure reading the Financial times and watching my FA swish past me in his Rolls Royce !

by Worrow, 11 Jan 2014

Hi, Worrow, and welcome!

Not even that boring, as it's great to get the regular cheques through the post, which you should get on a holding of that size, and it might be the big one!

Good luck!

by Feline123, 11 Jan 2014
add a comment

good luck with your bonds worrow.
like me and many others, you are not too impressed with financial advisers, though if you used a tied financial adviser instead of an independent one then i think you made the worst of two choices.

by ian123, 11 Jan 2014

Hi all, I am coming into some money soon and was wondering if I hold 30k pb can my partner and child also hold pb to increase our chances.

by DanBrum87, 18 Jan 2014

Yes but 30k is the combined limit i believe as the first part of the bond number is linked to your home address so if you want to fiddle you would have to use two different addresses.

Anyone aged 16 or over. Parents, guardians, grandparents, great grandparents can invest on behalf of under-16s

by Omendata, 18 Jan 2014

Thanks for the quick response. so if I hold the maximum no one else in the household can hold any. any suggestions

by DanBrum87, 18 Jan 2014

Yes the maximum for the household is 30k.

Use yer grans address or friend that you trust.
The hamilton accies all use the "relatives address" fiddle its an old one adn used for much more than tax fiddling and premium bonds believe me I used to work with CID - Some of the fiddles truly were astounding in their devious ingenuity.

And i dont mean to be offensive i just say it as it is.

Everyone is on the fiddle and the worst ones are the politicians , lawyers and bankers so i always stand up for the wee man ... until that is our country is full of decent honest people.....

Yip pigs and fly will probably be passing through your mind ....
Lol

by Omendata, 18 Jan 2014

do u see it as the best and safest option for investment. im a bit new to this. i dont want to leave it in the bank and slowly piss it up the wall if you no what i mean

by DanBrum87, 18 Jan 2014

Leaving it in the bank is a bad bet.

Lets just say premium bonds £10,000 - average (in reality not on paper) one years payouts were £25 + £25 wins thats all my best pal got and its been around that for the 10 years he has had them although in the last 2 years it definitely has paid less - whether because they are screwing us by paying out less or more people doing it who knows or he has lied to me and has is a secret millionaire i dont know - trust no 1 is my motto i dont even trust myself!

Personally i would put some in shares.
First Direct are most excellent share dealing at £11 a deal and 0.5% tax on purchase etc.

I would recommend Synthomer , Hyder Consulting , ARM technologies and possibly GVC holdings and Ryanair - the trick is to watch the shares in a share portfolio and know your stuff - when they fall a certain percent you can be sure good ones will bounce back and thats where you can make a few hundred pounds in a day or if you are willing to invest more than say £2000 a share you can make thousands.
Having said that if i had taken my own advice on ARM which is my favouite share - they manufacture all the chips for tablet pcs , washing machines etc etc etc and are the in my mind possibly going to reach Apple like heights of share value if i had invested recommended in another forum i would have made precisely £43,000 in a year but as i didnt i am kicking myself now!

And thats the thing with shares - never invest if you cant take the pain.
Some day traders during the internet stock boom were putting their houses on the line then topping themselves when it all went belly up - sheer greed - hence the question i always ask and that is "what is your greed quotient as we all have one!"

In reality there isntg any way of making a decent rate of interest / profit unless you take some risk.

You could of course split invest

Santander123 account - 3% interest. £20,000 max

Nationwide saver account £4500 max at 5% interest

Lloyds Tsb Class vantage i think is 3% - £5000 max

Depends how much you want to make ie your greed quotient!!!

With those accounts you would of course open them in the name of a family member who is a non tax payer so you dont get taxed.
There are folks out there who know of even more devious and sneaky methods but for that you would have to stick yer bum in the air 5 times a day and visit your religious establishment of middle eastern variety.
(Got to be safe i dont want the internet politically correct brigade putting a jeehad on my ass!!!)

by Omendata, 18 Jan 2014

My partner has the full £30,000 in PB's as do I, we both live at the same address and have both won small monthly amounts.

If we are not permitted to have more than £30,000, I am surprised that we have never been informed of this.

My understanding is that each person is permitted to hold up to £30,000 in bonds and this isn't limited to each residence.

Bonds are held in individual names.

Even their own site states the following;

19. Individuals Individuals of at least 16 years of age may, for their own benefit, purchase and hold Bonds in their own name.

We have both entered into correspondence in the past from this address, using our bond holding numbers, I would have thought they would have informed us of this, if it had been their ruling.

by Parchester, 18 Jan 2014

I stand corrected - even so its still a waste of your investment but ok if you are loaded and dont need interest on your money and can afford to play the game = safer than the lotto but about as much chance of winning anything significant.

PS. Parchest its not wise to give out your personal investment £££ on a forum indeed on any site on the internet. If someone compromises your account on this site and gains your email address , name address and you have used same on the national savings website etc ... well you get the drift - i presume you havent used your real name , address and no one on this forum actually knows it??? As i said before trust no 1.

The internet far from becoming safer is becoming more and more dangerous with every passing day.

Now that i have used a sql injection attack on the weak security on this website and obtained your ip address, name from which i will get your home address and know you have £60,000 in the nsb i will get your mothers maiden name , your relatives names and research more info about where you live, possibly do a bit of dumpster diving around your property and therefore possible passwords i will phone national savings and pretend to be you and ask for a password reset - change your account or phone you up and pretend to be from national savings - the fact i know you have 30k will make it even more plausible.
See what i mean about scary internet and that is just from 10 minutes worth of simple stuff!!!!

by Omendata, 18 Jan 2014

Thanks for the heads up.

by Parchester, 18 Jan 2014
add a comment

The reality is if you believe the stats on the Premium Bonds website you are even more of a mug than the dumb asses on benefits street.

Premium bonds are for the rich who have disposable throwawy income or pensioners who think its nice and safe and gthey wont loose anything - neither will they make anything and will waste 50 years hoping in vain for the big win - how sad is that.

I would rather have the thrill of risking it all and winning big than playing it safe and never winning anything more than a few £25 cheques every 6 months and having a safe boring life - I would rather just put the gun to my head now but thats just me and I am a BIT different -(substitute weird , odd , mad etc for "different" - I've heard it all).

"Live fast , die young and have a beautiful ending."
Eh G-Man....

by Omendata, 18 Jan 2014

Did you have too much sugar G-Man ...

by rosetta, 20 Mar 2014

Nope too many Bifders i think!

by Omendata, 21 Mar 2014
add a comment

as stated above the maximum holding is £30,000 per person.
the government alter the prize pot with general interest rates, so if interest rates fall they apply a lower percentage calculation to the whole amount of bonds in existence hence less prizes.
the nationwide do not have a saver account paying anything near 5%.
what they do have is a nationwide flexdirect current account paying 5% interest on balances up to £2500 for a period of 12 months.
hardly worth moving your bank account especially if you are tax payer.
first direct will credit your account with £125 should you move to them.
i suppose that may be taxable if you advised the taxman.

by ian123, 19 Jan 2014

Ok ok so it wasnt a saver account its still 5% i was speaking off the top of my head i am not 100% perfect - I could have researched but i think i provided a long and comprehensive answer hinting at some solution - why is it people just are so negative when someone is trying to help???

The guy has 30k to move dude!!!

Its up to the person asking the question to do further research to get all the info - what you want led by the hand every step of the way?

Jeez thanks a lot!!!

"Hardly worth moving your account" - What a typical lazy defeatist British attitude - it amazes me that the people who say these things obviously have so much money it doesnt matter but it matters to some....

by Omendata, 19 Jan 2014

negative? i was looking for the 5% you mentioned to move some investments.
i have saved other readers the bother of looking for something that is not there.
santander is one of your more better recommendations.

by ian123, 20 Jan 2014

Flexdirect i just couldnt remember the account name.

Easy to take offence on the net im afraid its just the way you phrased your answer.

by Omendata, 22 Jan 2014

no offence meant or taken.

by ian123, 22 Jan 2014
add a comment

Thanks for the update Sally .....it's true the bonds are just not as good as they were ....it is just the big win I am after .......maybe ..sadly I haven't heard of anyone I know winning more than £25 ....so where does the money go ?
Thanks Sal .....

by rosetta, 7 Feb 2014

I own bonds for several reasons. One, all bonds have the same probability to win the million pounds, however small: if I won £1000000 I would be very happy. Selling and re-buying is pointless - doesn't change the odds. Two, and this is my main reason, if my bank falls over, say my current account, which also doesn't give me interest, I might have some money from these bonds, as they are backed by the treasury for any short fall and inability to pay creditors, minimise the effects of insolvency, and survive a possible disaster. If the treasury goes down then we all have problems. Three, by setting up a standard order for the minimun, which I do, it helps me save money that otherwise I wouldn't. Since I don't have much money to invest it seems that this is better than doing the lottery or leaving it in my bank account. I still have some money to count on and can withdraw later and I can still dream about getting a million pounds that I probably will not ever get. I had one £1bond for 60 years and I did win £25. Unless you have lots of money investing elsewhere really isn't much different and no fun.

by lunalobo, 1 Mar 2014

My wife and I had £500 in premium bonds for years, never won a penny, so we upped our 'stake' to £2500, still never won a penny. After she passed away I increased my stake to £25,000, and have had over 40 wins in just over 2 years at £25 or £50, well over £1000, around £500 a year, interest free of course. As I am a 20% tax payer I would have had to get £625 in interest from my bank account to achieve the same, that's 2.5% per year. However, my bank only offers 0.1% on savings accounts so in fact I would have only received £25 a year, less tax. For me it's a no brainer, but PB's are a numbers game, and in my experience you have to hold £20 to £30k in bonds to win consistently.

by berlinetta, 20 Mar 2014

And I think be lucky.
I have a little less in an ISA and got over £800 in interest so maybe shop round for your savings?
Same with stocks and shares ... good and bad months .
Hope you do as well in the future but I would tot up my winnings after 5 yrs then maybe decrease my stake.

by martini97, 20 Mar 2014

It's a long time since we won anything maybe we will be lucky this month, you never know.

by Sabre, 12 Apr 2014

I have had £30,000 in premium bonds for 6 years now and have had a good tax free living out of it. Most in one month was £600 (twice) and for the first 4 months of 2014, I have won £150.I think you need to have the max.

by Darnalldavid, 17 Apr 2014
add a comment

What is the point of cashing in then reinvesting??

by rbetts, 5 months ago

You would reinvest in something else.

by martini97, 5 months ago

No point at all in reinvesting in PB's, rbetts but, as martini says, you could invest in something else.

by Feline123, 5 months ago

What is the best day in the month to make a 30k investment ie- if I invest today will I be in next months draw or have I missed the date and have to wait until the July draw . Dj

by davidp6, 5 months ago

Hi davidp, and welcome to the forum.

The day of the month makes no difference, as you have to hold your bonds for a full calendar month before they go into the draw.

So, bonds bought on any day in May will enter the draw on the 1st of July.

Good luck!

by Feline123, 5 months ago
add a comment

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