Premium Bonds Article Discussion Area

in Savings & Investments
816 replies 249.7K views
This thread is to discuss the
Premium Bonds: Are they worth it?
article

Also see the
Premium Bond Probability Calculator
to discuss the calculator specifically see the
Premium Bond Calculator Discussion.

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Replies

  • NeilWNeilW Forumite
    143 Posts
    Part of the Furniture 100 Posts Combo Breaker
    Interesting article.

    There is one comparison that you missed, which is to take the 'excess' interest (ie everything above 3.8%) you earn putting your money in a savings account and buying a bucket load of tickets in the National Lottery when they have one of those super rollover/super draw things.

    It'd be interesting to see how the probabilities of doing it that way stacked up against Premium Bonds and straight savings.

    I'd love to know what is the most probable way of becoming a millionaire given an investment of £1000 :-)

    NeilW
  • tightwadmantightwadman Forumite
    79 Posts
    A year back I had the full £30,000 investment in premium bonds and with that amount I should have been winning at least one prize every month. It didnt happen. Four months produced no prize at all. One month produced three wins - two £50 and one £100 and all the rest were just £50.

    Frankly I lost money as I would have received over £1000 more than my winnings had I left the money in a high interest account I had. Dont even think about Premium Bonds as an investment and frankly if you cannot win with £30,000 worth what do you think your chances are with the odd bond or two or even a thousand? Only the stinking rich should think about putting money into bonds.

    Frankly the experience has made me hugely cynical and I dont believe there are in fact any winners of the big prizes. I have seen no evidence and the winner is always anonymous. Surely by now someone would have come forward to explain what they did with their mill ?

    Steer well clear of premium bonds!
  • Alan50Alan50 Forumite
    138 Posts
    I have held PB for 20 years (currently hold 14K) my rate of return is between 2-6% a year, I would agree with most posts that its not the best way to invest, but you do have a chance of the 1M!
    I am not a mathamatician but I have taken a note of the holdings of PB 1M winners over the last 4 years...90% of winners have the maximum holding of 30K....the more you have the better the chances?

    If you have a PB a/c No. you can veiw on-line the high value winners, date the winning PB was purchased and the holding quatity www.nsandi.co.uk

    Alan
  • bazsterbazster Forumite
    7.4K Posts
    1,000 Posts Combo Breaker
    I once read some very succinct advice on PB's. It went something like this:

    PB's are nothing but a way to gamble your interest. If you want to gamble your interest, put your money in a savings account. Each month, withdraw your interest and take it to the Casino. The odds are better.
    Je suis Charlie.
  • MonikerMoniker Forumite
    626 Posts
    Part of the Furniture Combo Breaker Mortgage-free Glee!
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    My mother-in-law swears that holding premium bonds in a block wins you prizes more often than if they are held individually. I have round £2000's worth in £50 units. Should I cash them and buy a block of 2000 which would give me consecutive numbers? Advice/experience welcome.
  • i have £30,000 of premium bonds which I have had invested since December 2005. My first eligible draw was Februaury 2006 and since then I have received prizes totalling approximately £1400. I'm not sure whether I should stick with premium bonds or whether I should move my money. I intend to keep the money in savings until my partner and I move from our rented house and buy a house together. This may be another 12 months away or more. I would welcome some advice as to where I would be best to keep my money.
  • baby_boomerbaby_boomer Forumite
    3.9K Posts
    Part of the Furniture 1,000 Posts Combo Breaker
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    Moniker wrote: »
    My mother-in-law swears that holding premium bonds in a block wins you prizes more often than if they are held individually. I have round £2000's worth in £50 units. Should I cash them and buy a block of 2000 which would give me consecutive numbers? Advice/experience welcome.
    Should you cash them in? Yes. Should you buy PBs with the proceeds? No. You could put it into a cash ISA and get 6% gross = £120 pa.

    Over the years the compound interest earned could provide you with security or a substantial treat.

    Do you also consult your m-i-l on important matters?
    Alan50 wrote: »
    I have held PB for 20 years (currently hold 14K) my rate of return is between 2-6% a year
    For comparison purposes, bank base rates over that 20 year period fluctuated from 9% to 10% to 7.5% to 15% to 10% to 12% to 5.25% to 6.75% to 5.75% to 7.5% to 5% to 6% to 3.5% to 5.75%.
  • dzugdzug Forumite
    2.3K Posts
    NeilW wrote: »

    I'd love to know what is the most probable way of becoming a millionaire given an investment of £1000 :-)

    NeilW

    Don't you mean least improbable?
  • miaxmiamiaxmia Forumite
    309 Posts
    ✭✭
    A year back I had the full £30,000 investment in premium bonds and with that amount I should have been winning at least one prize every month. It didnt happen. Four months produced no prize at all. One month produced three wins - two £50 and one £100 and all the rest were just £50.

    Frankly I lost money as I would have received over £1000 more than my winnings had I left the money in a high interest account I had. Dont even think about Premium Bonds as an investment and frankly if you cannot win with £30,000 worth what do you think your chances are with the odd bond or two or even a thousand? Only the stinking rich should think about putting money into bonds.

    Frankly the experience has made me hugely cynical and I dont believe there are in fact any winners of the big prizes. I have seen no evidence and the winner is always anonymous. Surely by now someone would have come forward to explain what they did with their mill ?

    Steer well clear of premium bonds!

    I have to disagree - did the same just over a year ago and have won every month, except one, usually multiple wins of £50/£100 and won month we won £500. We have made more in the past year than in a high interest bank/building society account.
  • torbrextorbrex
    71.3K Posts
    10,000 Posts Combo Breaker Rampant Recycler Hung up my suit!
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    Must be something wrong with my thinking, I dont look on my PB's as an investment, I see them as a gamble, I used money that I had spare and bought my bonds with no thought of regular returns, rather, I am waiting and hoping for the big win like I do with any other gamble that i do.
    Surely no-one buys a lottery ticket or bets on a horse as an investment so why even look at PB's that way. Yes the money can be reclaimed at face value but if like me you were to buy the bonds with 'lost' money then you can settle back and hope for a win rather than expect one.
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