MSE News: NS&I to increase Premium Bond prize rate to 4%
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CompulsiveSaver said:So NS&I are still paying catchup... Shawbrook are now paying 4.35% and even the best ISAs are 4.1% (Coventry).
Does anyone else think they should just add £25 prizes? the £1 million is a nice marketing point, but there is almost no chance of winning it! so just keep a single million prize and vastly increase the £25 prizes, that way there is a much better chance of winning something! (yes, I did get less than £100 this month on the max holding ) which is what we are doing by putting our money in premium bonds.
They still have a 3 year bond paying 4.2%, payment on maturity. That's such a duff deal.0 
My wife and I both had the max £50k in Premium Bonds for 2 years commencing Jan 2021.
Total winnings £1750
1.75% gain in 2 years. Granted interest rates were lower over that period, but hardly a spectacular return.
Cashed them all in at the end of 2022 and put the money into a combination of fixed cash ISAs and fixed/easy access savings accounts.Then moved £40k of the taxable savings into new money ISAs for the 23/24 tax year.
Personally I don't think the chance of a big win outweighs the fact that you can do better with taxable and tax free savings elsewhere. I won't be rushing back to PB unless the real world payout for the average luck participant is significantly higher than it is now.
If they add more lower value prizes by reducing the big headline prize values, then I guess the thrill element is reduced and PB become a more predictable tax free form of savings. Even more of a reason to max out ISA allowances, unless the rebalanced PB prize structure offers a real world improvement on beating the return on a similar cash saving placed elsewhere.1 
CompulsiveSaver said:So NS&I are still paying catchup... Shawbrook are now paying 4.35% and even the best ISAs are 4.1% (Coventry).
Does anyone else think they should just add £25 prizes? the £1 million is a nice marketing point, but there is almost no chance of winning it! so just keep a single million prize and vastly increase the £25 prizes, that way there is a much better chance of winning something! (yes, I did get less than £100 this month on the max holding ) which is what we are doing by putting our money in premium bonds.0 
CompulsiveSaver said:Does anyone else think they should just add £25 prizes? the £1 million is a nice marketing point, but there is almost no chance of winning it! so just keep a single million prize and vastly increase the £25 prizes, that way there is a much better chance of winning something! (yes, I did get less than £100 this month on the max holding ) which is what we are doing by putting our money in premium bonds.1

eskbanker said:CompulsiveSaver said:Does anyone else think they should just add £25 prizes? the £1 million is a nice marketing point, but there is almost no chance of winning it! so just keep a single million prize and vastly increase the £25 prizes, that way there is a much better chance of winning something! (yes, I did get less than £100 this month on the max holding ) which is what we are doing by putting our money in premium bonds.
In July's draw there was 5061349 prizes, converting a million into £25 converts one into 40,000 so 5101348 prizes, so instead of roughly a 1 in 24000 it would have been roughly a 1 in 23800.
The £million was introduced in 1994 (surely in response to the lottery?) and going from 2 to 1 would hamper the appeal. Surely most who have max holdings look at how much they won over the year rather than whether any one month is poor.
Whilst it's unlikely, introducing a £5 prize (take 500K £25, 250K of each of £50 and £100) creates 9million more prizes and changes 1/24000 to 1/8500. It would also mean those with say £4K would get prizes most months rather than a couple of times a year.
It depends on what the psyche is. Would winning £5 most month be more or less appealing than £25 a couple of times a year?0 
lohr500 said:My wife and I both had the max £50k in Premium Bonds for 2 years commencing Jan 2021.
Total winnings £1750
1.75% gain in 2 years. Granted interest rates were lower over that period, but hardly a spectacular return.
Cashed them all in at the end of 2022 and put the money into a combination of fixed cash ISAs and fixed/easy access savings accounts.Then moved £40k of the taxable savings into new money ISAs for the 23/24 tax year.
Personally I don't think the chance of a big win outweighs the fact that you can do better with taxable and tax free savings elsewhere. I won't be rushing back to PB unless the real world payout for the average luck participant is significantly higher than it is now.
If they add more lower value prizes by reducing the big headline prize values, then I guess the thrill element is reduced and PB become a more predictable tax free form of savings. Even more of a reason to max out ISA allowances, unless the rebalanced PB prize structure offers a real world improvement on beating the return on a similar cash saving placed elsewhere.0
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