Premium Bonds Article Discussion Area

Tanguera

I agree I see them as a gamble rather than investment - but thats not a bad thing. I already have a long term savings plan anyway. I bought mine with money I inherited and other spare cash, figuring I could also access these funds quickly if needed (as a contract worker I need an easily accessible contingency for periods where I may not be working, athough I haven't had to draw on my funds yet). The interest I risk missing out on by investing them in bonds rather than somewhere else isn't exactly life changing and I'm cetainly not going to get stressed out by this since they haven't been bought with hard earned cash, but with I didn't expect to receive anyway.

Martin mentions the poor odds of winning the single 1 million prize which I accept, however he neglects to mention the large number of smaller but still but still significant prizes which you have much better odds of winning. Even winning £10,000 would be very welcome and useful to me. I don't expect to win but someone has to and given my my substantial 25k investment the possibility is certainly there. Having premium bonds gives me a sense of hope and excitement which I don't get from other savings products. I agree you have to be in it to win it.

I wouldn't recommend PBs as a long term investment or as an alternative to a retirement plan. However, if you have spare cash or come into extra money unexpectedly then why not?

Beate

I have just got a cheque for £25 in the post, first win ever. They have included a form to sign if I want to reinvest any further winnings - why would I want to do that? I don't have to sign this, right? Also, not quite sure why it says in Martin's article to check for old winnings - don't the cheques come automatically?

Paul_Herring

Beate wrote: »

I have just got a cheque for £25 in the post, first win ever. They have included a form to sign if I want to reinvest any further winnings - why would I want to do that?

In case you want to add to your savings rather than spend the 'winnings'.

I don't have to sign this, right?

Not unless you want to.

Also, not quite sure why it says in Martin's article to check for old winnings - don't the cheques come automatically?

They do, if they have your correct address. If they don't have your correct/current address, then they won't.

endless_2

The high prizes (1000 up) for March 2012 are just out and there are 27 winners who bought their bond in January 2012.

Manuker

I currently hold approximately £10k I won £25 last month & 2 prizes of £25 this month. My prizes get reinvested, last year (having only around £8k) I won 2 prizes of £25 and a prize of £100. I find ISAs TOO easy to access. My ISA currently has a poor interest rate (APR) I'd rather take the risk and possibly get more, worse is I lose possible interest, whereas with the lottery you lose your money!

I think this site is too quick to bad mouth premium bonds.

Prembondfan

No doubt this has been said here before but millions of people lose millions of pounds each week, many of them spending more than they can afford, hoping to win one of the big prizes on the various lotteries. In addition to the much, much lower odds, the biggest advantage of Premium Bonds is that you NEVER lose your stake money. Yes, inflation is a factor but that also goes for money wasted on lotteries. Also, prem bonds help the country's finances in a small way whereas lotteries just fill the coffers of private companies, making the enormously wealthy even wealthier.

bec219

Is it really worth me keeping my £30K invested in premium bonds, surely now with the winnings so low its time to look at investing it somewhere else. Do anyone else feel the same and any idea's where to invest this amount of money

Aegis

Prembondfan wrote: »

No doubt this has been said here before but millions of people lose millions of pounds each week, many of them spending more than they can afford, hoping to win one of the big prizes on the various lotteries. In addition to the much, much lower odds, the biggest advantage of Premium Bonds is that you NEVER lose your stake money. Yes, inflation is a factor but that also goes for money wasted on lotteries. Also, prem bonds help the country's finances in a small way whereas lotteries just fill the coffers of private companies, making the enormously wealthy even wealthier.

You lose your stake money every time you play and win nothing. Someone with the full holding of £30,000 has a nominal level of interest on their holding of 1.5%, meaning they are effectively gambling with £450 a year, more than most people spend on lottery tickets if they play.

If you look at it in comparison with savings accounts accounts with decent rates of interest, then the situation gets much worse, especially for anyone below the higher rate of tax.

Paul_Herring

Prembondfan wrote: »

No doubt this has been said here before [...]

Yes. And repeating it yet again doesn't make it any truer.

but millions of people lose millions of pounds each week, many of them spending more than they can afford, hoping to win one of the big prizes on the various lotteries. In addition to the much, much lower odds, the biggest advantage of Premium Bonds is that you NEVER lose your stake money.

Wrong. Your stake is the interest you could have got if that money was in a savings account.

Yes, inflation is a factor but that also goes for money wasted on lotteries.

So you admit there's little difference between the two then....?

Peco141

Tanguera wrote: »

Having premium bonds gives me a sense of hope and excitement which I don't get from other savings products.?

Thread discussion sealed for me in that one sentence.. The one main reason to have premium bonds. It also answers the question are they worth having over savings accounts.