Premium Bonds, Windfall Bond, etc.

doe808

Evening all,

My father holds the maxmium amounts in Premium Bonds and Windfall bonds from The Childrens Building Society. He also has an account with Nationwide.

Are their any similar products on the market, with a monthly draw?

Thanks

eskbanker

https://www.halifax.co.uk/savings/savers-prize-draw.html and https://www.prizesaver.co.uk/ are another couple....

gozaimasu

The Children's Building Society doesn't exist so I assume you meant The Family Building Society. Six times better than Premium bonds eh? Interesting. If I opened one today would that count for December draw in the same way that Premium Bonds would?

doe808

gozaimasu said:

The Children's Building Society doesn't exist so I assume you meant The Family Building Society. Six times better than Premium bonds eh? Interesting. If I opened one today would that count for December draw in the same way that Premium Bonds would?

Thats the one. Thanks, details here:

https://www.familybuildingsociety.co.uk/savings/notice-accounts/windfall-bond/how-the-windfall-bond-works

gozaimasu

Thanks but that doesn't say if the debit card deposit would open the bond today and qualify for the December draw. If I bought more Premium Bonds today with a debit card, then I would qualify for the December draw even though NS&I wouldn't get the money for a couple of days after the debit card transaction. The terms give a couple of examples e.g. " (for example, a Windfall Bond opened on 25 September is eligible
for inclusion in the draw for the first time in
November") but it doesn't explicitly state that the 25th of the month is the last eligible date to open to be entered for the second month's draw.

Anyone else have experience of what happens with this?

masonic

gozaimasu said:

Six times better than Premium bonds eh? Interesting.

Weasel words, unfortunately. They are comparing the chance of a single bond winning a prize, but each bond costs £10,000, whereas I believe a single premium bond is just £1, so you can buy 10,000 premium bonds for the same price as one windfall bond. If you crunch the numbers here it looks like the equivalent rate is 0.83% (including the 0.1% guaranteed interest). You have a 1 in 60 chance of winning a prize over the course of a year per £10k saved. The smallest prize is £1k, so quite a lot more than PB, average prize amount is £4.4k. That ultimately means that more people will win nothing.

gozaimasu

@masonic based on what you've said I can't work out if it's worth it or not.

masonic

gozaimasu said:

@masonic based on what you've said I can't work out if it's worth it or not.

It's a slightly lower payout ratio than premium bonds. It is much more a game of chance than premium bonds - you are considerably more likely not to win anything on an equivalent sum and time invested. So I would prioritise maxing out premium bonds first. This isn't a product for me, but if you are ok with there being much fewer, bigger, prizes, and the need to be quite lucky to get a worthwhile return then perhaps it will appeal.

AskAsk

masonic said:

gozaimasu said:

@masonic based on what you've said I can't work out if it's worth it or not.

It's a slightly lower payout ratio than premium bonds. It is much more a game of chance than premium bonds - you are considerably more likely not to win anything on an equivalent sum and time invested. So I would prioritise maxing out premium bonds first. This isn't a product for me, but if you are ok with there being much fewer, bigger, prizes, and the need to be quite lucky to get a worthwhile return then perhaps it will appeal.

not heard of this until i saw this thread.  had a quick look and some articles about the windfall bond.  the winnings are taxed unlike premium bonds i believe.  and my worry would be that the windfall bond is administered by a small building society and that the number of bond holders are very low even though the fund value is of a reasonable size as each bond holder hold lots of bonds.  we know the premium bonds is well known and ran for many years and that ernie can be relied upon to do his stuff independently and not be corrupted.

what guarantee is there that the family building society is doing the draw indepently and not give the prize to some interested bond holders more often than the rest??

masonic

AskAsk said:

masonic said:

gozaimasu said:

@masonic based on what you've said I can't work out if it's worth it or not.

It's a slightly lower payout ratio than premium bonds. It is much more a game of chance than premium bonds - you are considerably more likely not to win anything on an equivalent sum and time invested. So I would prioritise maxing out premium bonds first. This isn't a product for me, but if you are ok with there being much fewer, bigger, prizes, and the need to be quite lucky to get a worthwhile return then perhaps it will appeal.

not heard of this until i saw this thread.  had a quick look and some articles about the windfall bond.  the winnings are taxed unlike premium bonds i believe.

According to their own information the winnings are tax free, presumably as it is treated as gambling.

AskAsk said:

and my worry would be that the windfall bond is administered by a small building society and that the number of bond holders are very low even though the fund value is of a reasonable size as each bond holder hold lots of bonds.  we know the premium bonds is well known and ran for many years and that ernie can be relied upon to do his stuff independently and not be corrupted.

what guarantee is there that the family building society is doing the draw indepently and not give the prize to some interested bond holders more often than the rest??

A valid concern, although the usual exclusions apply for those connected to the building society, and presumably there is some form of independent oversight. That information should be available (it's the least they can do if you are parting with multiples of £10k to enter)

eskbanker

masonic said:

AskAsk said:

and my worry would be that the windfall bond is administered by a small building society and that the number of bond holders are very low even though the fund value is of a reasonable size as each bond holder hold lots of bonds.  we know the premium bonds is well known and ran for many years and that ernie can be relied upon to do his stuff independently and not be corrupted.

what guarantee is there that the family building society is doing the draw indepently and not give the prize to some interested bond holders more often than the rest??

A valid concern, although the usual exclusions apply for those connected to the building society, and presumably there is some form of independent oversight. That information should be available (it's the least they can do if you are parting with multiples of £10k to enter)

https://cdn-web.familybuildingsociety.co.uk/docs/librariesprovider3/pdfs/fbs-s190-0620-windfall-bond-draw-rules_web.pdf says:

12. Winners will be selected at random from all entries to each monthly draw by an independent third party appointed by the Society.

[...]

21. A list of winners will be published on our website shortly after the draw takes place, and we will also send an email to all Windfall Bond account holders who have provided us with a valid email address. Alternatively, a list of winners will be available four weeks after each monthly draw takes place, and you can request a copy of this list by sending a stamped addressed envelope to Family Building Society, Windfall Bond Monthly Free Draw Prize List, Ebbisham House, 30 Church Street, Epsom, Surrey, KT17 4NL.