Odds of winning Premium Bonds lengthen

nappe_2

I hadn't been keeping an eye on the cash ISA rate, till yesterday when I found the rate was less than inflation. I've now set in motion the transfer process to get that money into Scottish Widows and my Premium Bonds will be cashed on the 1st December, God knows where I'll put them.

I agree that Premium Bonds are also a bit of fun, in the hope that I'll one day win something worthwhile, but the rate of return is dropping to such a silly level that it's gone beyond a joke.

How are the Government going to borrow all the money they are suggesting that they borrow when they pay such low rates of interest? The only worthwhile National Savings investment I now have are the Treasury bonds, but if we go deep enough into negative inflation, will I end up owing them money as they are based upon the RPI......

miserable_ol_so_n_so

Primrose wrote: »

I have a fair amount in Premium Bonds but now the interest rates on my other savings has plummeted I think the time has come to bite the bullet and cash them in. Even the amount of interest I will earn on a Fixed Term account will be peanuts, but hopefully more than I would get on PB's.

Good on you, and anyone else who walks away from useless savings products. Until and unless more of us do so, the providers will have no incentive to improve returns. I'm afraid we are heading for the same situation as they had in Japan. Over there, the best selling items were home safes! The average Japanese had no confidence in the Banks which were folding by the dozen everyday. The best place to keep the money was at home! Why should we risk our money for derisory rates when you can keep it at home. After all, all that the banks do with our money is pay themselves huge packages and give us poor returns and then conveniently go bust?

westy69

whats the odds of you winning anything from putting your money in a savings account?

MJS996

I'm obviously different to most people on here.

With falling interest rates everywhere, to me, PB are now less questionable than they were a couple of months back.

They're a bit of fun, a bit of a gamble where the only risk is you end up where you started. The interest payable after tax at current rates in a bank/building society on a small amount (maybe not the full amount) is so small that I figure I might as well sacrifice it for the chance of a decent prize in PBs

funkyhitman

Jonbvn wrote: »

PB's are by far the largest (i.e. most money) "savings" vehicle in the UK. This means that a lot of people are treating PB's as savings.

Really? That's insane. I'm all for PB's but I have far more money in proper savings accounts. Are there really people out there who only use PB's for savings? That is silly lol.

Milarky

I think I suggested somewhere that they might have to go to 48,000:1 so people will be back slapping that it's 'only' 36,000:1

Of course, that does mean that even someone with the maximum holding now has less than a 50% chance of winning a prize each month....

Update: New distribution here
(Didn't expect this amount of skewing by NS&I...)
'middle prizes' now just 1% by value! 'lower prizes' now 95% by value expected[/I] return of about 1.6%....] But the 'higher prizes' are now out of kilter at 4% by value. Premium bonds now effectively have only small and very large prizes.

McSaver

If BOE hits 0% whats the percentage they gonna pay on premium bond prizes then?

And what will be the odds?

Fella

1.80%. Effectively the equivalent of 3.0% for a higher-rate taxpayer.

Another disgraceful action from this Govt that knows full well many PB holders are too young or too doddery to have a clue that they've just been shafted. This Govt wants you to do ANYTHING but save.

I had the full whack - will be withdrawing the lot on Dec 1st.

Paul_Herring

<stir>
How does this affect the oft-cited relationship between:

1) 30K in PB's and
2) 30K in a relatively high savings account and spending the monthly interest on lottery tickets?
</stir>

Fella

Paul_Herring wrote: »

<stir>
How does this affect the oft-cited relationship between:

1) 30K in PB's and
2) 30K in a relatively high savings account and spending the monthly interest on lottery tickets?
</stir>

Am fairly sure the Lottery is a clear winner now.

If nothing else, you could do (2), keep enough interest that you've equalled the PBs (which would only be about half of it) & invest the other half in lottery tickets. Giving you PB-equalling returns minimum AND lots of lottery chances.