Premium Bonds Suck

eskbanker

vacheron said:

Any percieved improvement in bond returns from owning particular bonds, owning a certain number of bonds, or how they are allocated is nothing more than coincidence mixed with a large dollop of confirmation bias.

Absolutely this - for everyone who's convinced that they've benefitted from changing or consolidating their bonds there'll be someone experiencing the opposite effect but who's less likely to advertise the fact!

badmemory

We all have different experiences of PBs, I know what mine are & am quite content with the selling rebuying decision I made.  Which is after all, all that matters.

eskbanker

badmemory said:

We all have different experiences of PBs, I know what mine are & am quite content with the selling rebuying decision I made.  Which is after all, all that matters.

Sure, but the objective point is that an increase in return after changing bonds doesn't mean that the increase is because of changing bonds, i.e. the important distinction between correlation and causation.

TSween

There is a maxim about gambling i.e. "Probability does not have a memory." Every month each valid bond has an equal chance of winning a prize, be that bonds that have never won, bonds that won recently, old bonds, recent bonds, single bonds or bonds in a block. In a month where a bond holder with the maximum holding has 3 successful bonds (i.e. more than the theoretical success rate) that bond holder will have had 49,997 bonds that won nothing.

One should not be expecting Premium Bonds to provide a market regular return on the investment but it should be seen as a plus when Lady Luck provides some extra spending money and one can also dream of that fortune that may come one day. A share holding held for 5 or 10 years will probably give a greater return but where is the expectation and possible excitement each month.

Newbie_John

I think there's sth odd here, 35 years max holding and no wins? That's impossible - 0.012% for a singular year with 0 wins.

When you have £50k the wins won't be allowed back into the bond as it's full and send to your nominated account.

Are you sure they haven't been sent to either some dormant account, by cheque to an old address etc.

Section62

Newbie_John said:

I think there's sth odd here, 35 years max holding and no wins? That's impossible - 0.012% for a singular year with 0 wins.
...

OP said "no wins of any note" - so could have been winning £500 every month for the last 35 years if £1000 is the prize level they consider to be notable.

poppystar

Newbie_John said:

I think there's sth odd here, 35 years max holding and no wins? That's impossible - 0.012% for a singular year with 0 wins.

When you have £50k the wins won't be allowed back into the bond as it's full and send to your nominated account.

Are you sure they haven't been sent to either some dormant account, by cheque to an old address etc.

OP actually said “no wins of any note” - possibly he was expecting a big win by now whereas many of us are quite content with the smaller wins. I’d have been pleased to have got the £50 he derides this month! Maybe “of note” means over £1000? 

Always amazes me how people who choose to buy premium bonds, with the known randomness of winning but with security of the capital, get so heated. If getting a market return (and probably having to pay tax on it) is so important then why not quietly withdraw and go for a conventional savings account - of course reading the terms carefully first so the interest appears when you want it and withdrawals happen as rapidly as you will want. 

slinger2

Even after 35 years of a full holding (using current prizes) your largest prize is likely to be £1,000. 1 in 4 chance of a £5,000 win and then less and less likely for the bigger prizes. Million pound prize every 100,000 years.

PremiumBondsSuck

Newbie_John said:

I think there's sth odd here, 35 years max holding and no wins? That's impossible - 0.012% for a singular year with 0 wins.

When you have £50k the wins won't be allowed back into the bond as it's full and send to your nominated account.

Are you sure they haven't been sent to either some dormant account, by cheque to an old address etc.

I said "no wins of note." I don't call 100 pound wins on a 50,000 pound holding "noteworthy"

badmemory

I've never won anything of any note.  I have however won almost every month & averaging over the last 5 years over 3%.  Some of that time I would be very lucky to get 2% on savings.  One month I even got 18% (£750).  I put the first lot in because my interest was about to become taxable & my ISA was full.  I do have 2 from 1957 which I keep for sentimental reasons.  One Xmas & one birthday present.  So far I am happy.  I may feel different if I ever go several months without winning at all.