Premium bonds info please.

bobmac

Major Champion
Joined
Feb 2, 2009
Messages
27,475
Location
Lincolnshire
Visit site
My neighbour has some and he seems to win quite frequently, small amounts but they all add up.
Certainly more than the paltry interest I get from my Halifax savings account.
I've been told the only downside is no interest is paid out, is that correct?
Thanks in advance for any info
 

Lord Tyrion

Money List Winner
Moderator
Joined
Sep 9, 2014
Messages
26,690
Location
Northumberland
Visit site
Correct. You generally need to have a lot to win back, so not great. I was given £100 worth from my mum about 20 years ago. Never won once.

My auntie has quite a few thousands worth and will win a few times a year. Small amounts, nothing of note. Whether it is better than current savings rates ..............
 

Pin-seeker

Well-known member
Joined
Jul 10, 2012
Messages
13,950
Visit site
My dad has some & he’s won a lot more than interest he’d have got in a savings account.
Sorry that’s all I know.
 

Billysboots

Falling apart at the seams
Moderator
Joined
Aug 25, 2009
Messages
5,781
Visit site
When I retired in 2021, because interest rates were low I invested quite heavily in Premium Bonds - I took the maximum amount you could buy. I generally won £50-75 per month. As interest rates have risen my money has been moved elsewhere.

You’re right, Bob. They are a cash investment with no interest payable. As a rule of thumb I’d say they’re okay when rates are low, as you have a reasonable chance of winning if you have a decent sum to invest. But don’t touch them when rates make other investments attractive.
 

pokerjoke

Money List Winner
Joined
Nov 17, 2009
Messages
10,785
Location
Taunton ,Somerset
Visit site
I had the max amount about 5 years ago and won a few £25s
Now down to 5k and still only won small amounts.
My mate won 10k and I bought off the back of that.
As people point out you’re getting nothing in the bank.
Just buy them and forget about them,you never know.
 

bobmac

Major Champion
Joined
Feb 2, 2009
Messages
27,475
Location
Lincolnshire
Visit site
When I retired in 2021, because interest rates were low I invested quite heavily in Premium Bonds - I took the maximum amount you could buy. I generally won £50-75 per month. As interest rates have risen my money has been moved elsewhere.

You’re right, Bob. They are a cash investment with no interest payable. As a rule of thumb I’d say they’re okay when rates are low, as you have a reasonable chance of winning if you have a decent sum to invest. But don’t touch them when rates make other investments attractive.

So if someone had 10k sitting around earning very little interest, it might be worth a go? You've got to be in it to win it as they say.
I would like to be able to get at the money quickly too if the right EV comes along. (Have you seen the price of them?) ;)
 

D-S

Well-known member
Joined
Dec 31, 2020
Messages
2,976
Location
Bristol
Visit site
You can get your money out quickly if you want, if you cash in online it’s in your account a couple of days later but when you reinvest it misses one month’s draw. So not a bad ‘header tank’ for cash.
 

Billysboots

Falling apart at the seams
Moderator
Joined
Aug 25, 2009
Messages
5,781
Visit site
So if someone had 10k sitting around earning very little interest, it might be worth a go? You've got to be in it to win it as they say.
I would like to be able to get at the money quickly too if the right EV comes along. (Have you seen the price of them?) ;)

Absolutely - I had mine for about a year and had a return most months, but even with £10k lying idle there are some decent deals to be had on fixed term savers at the moment which make Premium Bonds look pretty unattractive.

But nowhere near as unattractive as an EV, Bob 😇
 

Voyager EMH

Slipper Wearing Plucker of Pheasants
Joined
Mar 14, 2021
Messages
5,138
Location
Leicestershire
Visit site
The amount paid out in prizes is directly linked to the BoE base rate. So there has been immediate increases of late.
It usually takes banks and building societies a little longer to increase their savings account rates.
Mrs V and I bought some over 3 years ago with our retirement savings. Seemed like a good idea at the time as interest on savings accounts was so poor.
With Premium Bonds, the sky is not the limit, but near enough.
We've had more than 1% per annum return for 3 years - so not bad. That was all in £25, £50 and £100 prizes. Some months - zilch. And there is always that little chance of a big one.
Recent two months have been the best return so far, now that the payout rate has increased.
 

jim8flog

Journeyman Pro
Joined
May 20, 2017
Messages
14,687
Location
Yeovil
Visit site
My daughter ws the lucky one in our house she got 5k when my mum died and it went in to premium bonds.
She used to think all the nice little extras like a new bike were coming from us but they were coming from her bond winnings.

When they paid out 8% of the fund and you had the maximum hoding they were considered to be good source of tax free income with an average return of around 4-5%.
 
Last edited:

jim8flog

Journeyman Pro
Joined
May 20, 2017
Messages
14,687
Location
Yeovil
Visit site
Story from a few years back. When they first came out you bought them in the post office at £1 per bond.

My mum used to buy some whenever she could afford it and put aside some in each of the children's names.
My brother got his when he married, I was given mine when I left home but my sister says she never got any (she is the eldest).
There was an unclaimed prize of £250K one number away from nine. Now I often wondered if it was my sister's which had somehow been lost.

I use to check from time to time to see if it had been claimed and finally about 2 years ago I saw that it had , it must have someone in front my of mum or somebody found it after all these years. (it was purchased in the 1950s).
 

Kennysarmy

Newbie
Joined
May 2, 2011
Messages
753
Visit site
Won £25 in the last draw
Third time I've won that amount in 7 years.
Only had £500 invested since 10 months ago I've been adding £25/month.

My main savings are somewhere else, but it's fun to think I've a "chance" each month, someone has to win the big prize, I've more chance if I've got some bonds than not!
 

fundy

Ryder Cup Winner
Joined
Aug 6, 2010
Messages
27,025
Location
Herts/Beds border
Visit site
Theyve recently changed the payment profile again same amount of prizes but at higher values. We have our renovation fund in them so are slowly dwindly it down as we spend , we have about 55k currently, we won £275 this mth, some months been as low as £25 this is the highest but not had a month where neither of us has won something.

At almost 0% interest rates the returns were as good if not better than the banks but with the "chance", now theyre slightly worse than the top savings accounts but we'll keep them until the money is spent on the house then look to build them up again
 

cliveb

Head Pro
Joined
Oct 8, 2012
Messages
2,371
Visit site
The general consensus seems to be that your chances of getting somewhere close to the published return (which I believe is currently 3.6%) is to buy the maximum allowed (£50k).
About 18 months ago when the return was about 0.9% and bank rates were next to nothing I bought £50k, and got about a 1% return over the year.
I'm now thinking about pulling it out and putting it into a bank bond - you can get nearly 4% for a 1 year fixed bond (but of course that's taxable).
Last month I won nothing, and my mind was pretty much made up, but decided to wait until the Feb draw before cashing them in. And then I won £150 in Feb, so am again in two minds.
The dangling carrot that you might cop for one of the really big prizes is always there, but realistically those prizes are effectively non-existent - a bit like hoping to win big on the lottery.
 

Billysboots

Falling apart at the seams
Moderator
Joined
Aug 25, 2009
Messages
5,781
Visit site
The general consensus seems to be that your chances of getting somewhere close to the published return (which I believe is currently 3.6%) is to buy the maximum allowed (£50k).
About 18 months ago when the return was about 0.9% and bank rates were next to nothing I bought £50k, and got about a 1% return over the year.
I'm now thinking about pulling it out and putting it into a bank bond - you can get nearly 4% for a 1 year fixed bond (but of course that's taxable).
Last month I won nothing, and my mind was pretty much made up, but decided to wait until the Feb draw before cashing them in. And then I won £150 in Feb, so am again in two minds.
The dangling carrot that you might cop for one of the really big prizes is always there, but realistically those prizes are effectively non-existent - a bit like hoping to win big on the lottery.

To give you a comparison, I’ve currently got £50k split into two fixed term savers - £25k in each - one over 12 months, the other 24. The interest is paid monthly into my current account, as I was after income rather than capital growth, and I’m guaranteed just a shade under £200 a month.

Whilst I’m not in with a chance of winning the big prize, neither am I drawing blank months. It suits me at the moment.
 

Bunkermagnet

Journeyman Pro
Joined
May 14, 2014
Messages
7,708
Location
Kent
Visit site
My mother used to have PB and used to get something back almost everu draw. However now I understand they are reduced the draw total by one, I'm not sure how if it would have been as good.
Whilst I agree interest rates on saving aren't that good, some of the on line banks do a pretty good rate with lots of oprions. Paragon Bank and Aldermore Bank are 2 I use for differing monies;)
 

cliveb

Head Pro
Joined
Oct 8, 2012
Messages
2,371
Visit site
To give you a comparison, I’ve currently got £50k split into two fixed term savers - £25k in each - one over 12 months, the other 24. The interest is paid monthly into my current account, as I was after income rather than capital growth, and I’m guaranteed just a shade under £200 a month.
£200 a month from £50k is 4.8%, which is better than anything I've seen. Which bank is this?
 

bobmac

Major Champion
Joined
Feb 2, 2009
Messages
27,475
Location
Lincolnshire
Visit site
Thanks for all the advice. I even understood some of it. ;)
The money will only be in there for a year at the most, so not expecting much, just until I can afford my Tesla Kia Niro Renault Zoe Nissan Leaf
 
Top