Premium Bonds - 50k

egroeg1980

Hello all.

I've been a long-term user of Premium Bonds, but only a 3k-4k and won a couple of small prizes over the years.

I'm an Additional Rate tax payer so looking to bung in the max amount on PBs in the next couple of weeks (I think the max you can put in is 50k sterling?).

Just curious if anyone has any decent experience with a PB account to the max and whether it does kick back a worthy reward routinely?

I've had a wealth assessment to use as much of any tax efficient schemes as I can (pension, charities, ISAs etc) so PBs is my last resort of putting some extra cash away and not being stung on an un-wrapped saver.

Just wanted to know anyone has had decent winnings at 50K?

thanks - G

MikeJXE

I have just cashed in £50,000 which is the max due to poor returns of about 1.1%

It was ok when rates were low but not for me while rates are higher

It's luck of the draw, if your lucky then get premium bonds 

strawb_shortcake

Luck of the draw, my first year on max I won £650, second year £475 but in the past 4 months I've had £700,  but like S&S past performance is no guarantee of future performance. 

eskbanker

There's a long-running thread on the main savings board where PB holders (many with maximum holdings) report their winnings every month (for better or worse) so read through a few pages of that to get a flavour:

https://forums.moneysavingexpert.com/discussion/81778/premium-bond-winner#latest

[Deleted User]

I also have the whole amount in bonds as I pay high rate tax. I got £300 this month, £75 last month, £25 the month before, £125 the month before that. I always win something. It's either that, or pay tax on my interest.

GrubbyGirl_2

It's hit and miss.  Since I've had the full £50k I've had 1 year when I won the exact same interest rate, one year when I didn't get as much as the interest rate and 4 years where I have exceeded the interest rate with one year being almost triple.  my biggest prize has only been £100.  It's difficult to gauge this year because the interest rate keeps changing but I have won 1.25% with 2 months to go.  I pay high rate tax so I'm quids in

Albermarle

The prize rate has been increased to 3% in January.
The rate is skewed by the two One Million pound prizes, so in reality the average prize rate is more like 2.7% with an infinitesimal chance of winning a Million.
With £50K over 12 months you would expect to be close to that 2.7%.

eskbanker

Albermarle said:

The prize rate has been increased to 3% in January.
The rate is skewed by the two One Million pound prizes, so in reality the average prize rate is more like 2.7% with an infinitesimal chance of winning a Million.
With £50K over 12 months you would expect to be close to that 2.7%.

The median return is more like 2.4% now, since they changed from the small prizes being 90% of the pot to 80% now.

egroeg1980

All great contributions and a good sounding board. I plan to load up just towards the end of Jan to be in for Feb and on the March draw. At least then I'm in for the next tax year!

Thanks for all your helpful comments - gives me some reassurance.

jimjames

[Deleted User] said:

I also have the whole amount in bonds as I pay high rate tax. I got £300 this month, £75 last month, £25 the month before, £125 the month before that. I always win something. It's either that, or pay tax on my interest.

Using an option to avoid paying tax on interest isn't always a great idea if the overall return is less. Getting a higher return and paying tax may still be a better overall amount than a tax free PB.