Premium Bonds Article Discussion Area

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Hey

I have only just started looking at Bonds as the £4k in my Abbey e-saver really isn't getting me much interest, plus I'm fed up with these low rates and having to switch every so often to get a slightly higher rate, which in effect only gives me an extra tenner or so for all the added effort.

I still have most of my savings in an ISA, am saving around £750 pcm for a house deposit with looking to buy in ~2yrs, (x1 halifax 5% regular saver £500pcm, and about to open a barclays 6% regular saver £250pcm).

Now would it be worth taking a cheeky risk with this spare £4k in Bonds, and if so what sort of blocks should I buy. I have had a scan of this thread and most suggestions are to look at a minimum of £1k, so would it be worth going for 4x£1k, 2x£2k, or even a couple of £1k and a single £2k to start with ?

Cheers :beer:

Midnight_Cowboy_2

squink wrote: »

Am looking for best options for elderly person, come into @£400k, wants to buy house (@£250k), no pension (state only), small income from share dividends - how best to use remaining dosh (ie. £150K) to live from?
Advised by sound friend that p/bond (@ £30K) good idea in current climate for security, but Martin's tips are: low typical return for p/b (av. £450 p.a.) vs top ISA (£1053 return in year) and top saver (£900 in year).
Confused as to the point in putting into p/b's since spreading through all the top savers @ £50k each, all have higher interest rate (p/b @ 1.8%) therefore much bigger return.
Am I missing something (apart from the "thrill" of chance) ?

I would say the plus points of Premium Bonds are: security, if you're worried about banks, and the (very small) chance of a big win. The downside is that the return is pretty low (if you shop around savings accounts you could beat it by 1% I reckon) and the amount of income each month is not guaranteed. Have a look at my posts in this thread a couple of weeks ago, I did some calculations to find out for myself if it was worth it.

mrbonds

£60K of bonds. I know someone who has just put another lot in his wifes name so as to get a total of £60k worth as a household.

Here's hoping for a big win.

squink

Midnight_Cowboy wrote: »

I would say the plus points of Premium Bonds are: security, if you're worried about banks, and the (very small) chance of a big win.

Ref. security - that's why I don't see the advantage, with the £50k security per savings account - if things got so bad that that fell apart I think we'd be pretty stuffed all round anyway....cheers

ian-d

What baffles me is why bonds are only sold in £10's after a certain amount! I transferred the full entitlement over not realising that I had £5 from years ago, and NS&I sent me a cheque back for £10, so now I have £29,995 and being kinda OCD about money, if I want to make it £30k it seems I'll have to withdraw £5 (if at all possible) to then put £10 in!!! Those 5 bonds could make all the difference!

Anyone know of a better way?

Premium bonds for me are just about fun. Whilst interest rates are so low I'll hold out for the chance of a big win rather than standard interest you'd get on £30k. Plus at the moment I like the thought of interest being paid out in prizes to bond holders rather than being spend lending money to those already in debt, toxic loans etc (although I don't know if NS&I in some way do any of this too!)

bdon

PBs right now aren't good at all - they're like Gilts et al - the chance of winning that million gets lower and lower. I've only got a £1k but will be moving away over the next couple of years.

Re: original poster - I'd buy the house (somewhere to live) but remember to negotiate hard downwards - go in 20%- and expect .85* of value, consider dividend equities and (18mo+ index-linked govt products), repo will shoot up circa 2011 (early) as we stagflate. us divis?

martink9

ian-d wrote: »

What baffles me is why bonds are only sold in £10's after a certain amount! I transferred the full entitlement over not realising that I had £5 from years ago, and NS&I sent me a cheque back for £10, so now I have £29,995 and being kinda OCD about money, if I want to make it £30k it seems I'll have to withdraw £5 (if at all possible) to then put £10 in!!! Those 5 bonds could make all the difference!

I have the same dilemma - £29,992:rotfl: :rotfl:

squink

bdon wrote: »

Re: original poster - I'd buy the house (somewhere to live) but remember to negotiate hard downwards - go in 20%- and expect .85* of value, consider dividend equities and (18mo+ index-linked govt products), repo will shoot up circa 2011 (early) as we stagflate. us divis?

Thanks for the comment but didn't understand (most of) a word!!
Please translate (money virgin)

chopperharris

squink wrote: »

Thanks for the comment but didn't understand (most of) a word!!
Please translate (money virgin)

Pbs are tax efficent for some of us to be able to get rebates or stay under the threshold.

While its still getting a smaller interest than some accounts its not that much difference just now as the banks rates are shocking too....and then theres tax to come off.

Yet its tax free income that needs not be declared as depreciation of capital for any income related rebate I mentioned on another post.

The full 30k it works out good for us as we have 2x30k and its doing better than savings so far this year have done..however if the savings rates go up , highly unlikely in the short term , they would be checked again as part of our portfolio of savings and investments.

CLARITY>What the poster said is to drive a hard bargain in a cash buyers market if you go for a property.85 percent of the asking price being the target but opening at 80 percent and improving the offer.Ideally you want to aim for belwo the higher stamp duty threshold too which you will be at 250k.

silvercar

£1000 in PB since July 1999. Total winnings now £350.

Assuming I don't win again before July that will be 3.5% return in simple interest, slightly less in compound interest.