Premium Bonds: Are they worth it? Discussion Area

penniesmakepounds_2

kedi7uk wrote:

I've actually been toying with the idea of selling my bonds for a while, but I've never been able to find the process -
Someone I worked with years ago believed to get the best return you should recycle your bond numbers. He regularly sold his older bonds and bought new ones - he won on a regular basis and always the newer bond numbers.

I've found that whenever I've won they've always been the newer bond numbers - never the old one and definitely not the £1 I got from my grandma when I was born!

They make it easy enough to buy them, but hard to sell.. Anyone sold - can you tell me how to do it? - May try the recycling strategy myself - Wish me luck!

Funnily enough all the recent bonds I have bought have'nt won me a prize its the earlier ones. same applies to bonds I have bought for my kids, earlier ones have won prizes.

jtlowrey

toria27 wrote:

Should I cash them in?? still unsure even after reading martins article.

Forget all the statistics and figures for one second. Decide what YOU want out your investment?

1) A regular safe return from your investment, which can supplement your income. You are safe in the knowledge that you are getting the BEST possible return from your money. Its a bit boring, yes, but its effectively free money coming in..... High Interest savings/ISA.

2) A chance of winning a HUGE amount of money. Yes you might not win a sausage, but you are not too interested about getting back £15 extra a month or whatever small amount it is. If you ever need the money it will still be there and its far better than the lottery......... Premium Bonds.

3) A combination of the two

I personally have gone for the latter. Half in ISA, Half in premium bonds.
It follows the old wives tale, "never put all your eggs in one basket"! :money:

Flashfly

I've been reading this thread and been alarmed when people talk about recycling their PBs to improve their odds of winning. Firstly every bond has an equal chance of winning. It may seem that the newer bonds win but it might just be that more bonds have been sold recently than in the past.

MORE IMPORTANTLY - if you sell your bonds to buy them again, then you will be out of the draw for a month. Say you sold the bonds after a draw, it would take at least 8 working days before you were able to buy the new bonds. You'd then have to wait a full calender month before being eligible for the next draw. In this time you would miss out on a draw. So if you recycle you are doing yourself out of potential wins!

Nealmason1986

I thought long and hard on how to save some money while im a student. I knew if i had money in my bank or had my overdraft available i would suddernly appear even more overdrawn or on my limit. To prevent me doing this i put the whole of my overdraft into bonds and when i got myself out of my overdraft by working i put it all in bonds again so the money wasnt there to spend.

i have had my bonds 6 month ish and won 100 pound already. i had the same money in a internet saving account for 2 month and got about 5 pound on interest

Due to this i belive i have made more money on the bonds then i would have made if i put them in a savings account and the chance of winning big is always there. Also its harder to get money out of bonds to spend it if i have an impulse shopping idea.

However a HDTV will probably make me cash my bonds in at the mo. It would look great in my uni halls with an XBox 360. hahah

Mikeyorks

kedi7uk wrote:

They make it easy enough to buy them, but hard to sell.. Anyone sold - can you tell me how to do it? - May try the recycling strategy myself - Wish me luck!

Er .. if you can re-cycle (i.e sell and re-purchase) - then you know how to sell them??

Look at the NS&I website - or simply get a form from the PO.

Here's a link to the website - they'll send you an encashment form if you ring :-

http://www.nsandi.com/help/cashinmyinvestments.jsp

Leadplayer_2

robin58 wrote:

I had £150 in Premium Bonds brought about 5 years ago never one on these.


Milarky, you will never win any money with the £1 Premium Bond. My mother had the odd £1 bond going back to when they were introduced. They never won a thing.

Having said that - good luck on a win.

Not strictly true !

I have had 2 x £1 premium bonds since gran died in 1964 and have received £100 in winnings on 1 of these

jtlowrey

don9999 wrote:

But.......I simply don't understand why PBs 'are' considered to be an 'investment'. Surely they are just a gamble.
In reality they need to be compared with other gambles, like the lottery, or betting on horses, or going to the casino.

They are all 'investments' just of different risks and rewards.

Shares are considered an investment, yet they are no different to gambling. You can still lose all your money - you can still make a very high return.

If you think or a scale of risk and return from lowest to highest it eould run like so....

Savings Account -> Premium Bonds -> Shares -> Gambling (casino/betting/lottery)

The great thing about premium bonds in all of those, is you dont need any knowledge to make your money, you dont need a lot of money to invest to win big and the top prize is huge and you can always get your money out!:rotfl:

mailman_3

Some interesting myths from NS&I's website.

crystaltips68

interesting comments about premium bonds.
I work in a post office and we have been inundated with pb purchases.
Alot of people are having a flutter in December and then reinvesting elsewhere.
I agree with the comments about old £1 bonds, customers say they never win on them!
I think it is luck, but you can contact ns and i to reinvest old bonds back as new ones!! just to put minds at rest!!

Budget

Martin's article - to me - seems to be saying that if you have money to invest you'd be better off stashing it away in somwhere paying a guaranteed 5% per annum rather than in Premium Bonds where the AVERAGE interest rate is only 3.19% per annum and even that is NOT guaranteed. Many of the posted comments suggest that PBs are a GREAT idea as they personally have won large or regular amounts; others that they are PANTS as they personally have won nothing at all.
But what Martin did say was that PBs were only worth buying small amounts of for a flutter with the potential interest of 3.19%. As this is the 50th anniversary of the Premium Bonds, they are increasing the two £1 million prizes to FIVE x £1m in December and FIVE x £1m in June 2007 (not just £2m as stated by some). So my own strategy is to buy the minimum of £100 by the latest deadline of October 31st and sell these - to recoup my £100 - just 8 months later on July 1st 2007. Thus my loss of GUARANTEED interest in a more secure investment place would be two thirds (8/12ths) of £5.00 or just £3.33. Thus for 100 chances of winning one of TEN £1m prizes (and many more others of lower amounts) I am simply "gambling" away £3.33. HOWEVER HIGH the odds (billions to one, I agree, and this will be even higher as Sir Alan Sugar's ad results in more people buying PBs) it's a bit of fun for 8 months and if I only win a fiver before I sell, then I'm in profit. If I win nothing I've only lost £3.33