NSI Premium Bonds

mills112

https://forums.moneysavingexpert.com/discussion/comment/82111328#Comment_82111328

what you could do is to invest in the premium bonds for a couple of years and see how well you do. only actual experience will make sense to you as you may find that you are really unlucky and get very little wins or that you happen to be one of those lucky people that seem to get very good wins.

because of this "luck", where some people seem to get a lot more than you would expect, then on balance, there must be people who get a lot less than you would expect. so why not try it out yourself and see which bunch you belong in.

i am generally a very lucky person, but my luck doesn't seem to pay off with the premium bonds and i tend to get less than the average.

wmb194

Low coupon gilts are another option. Capital gains are CGT free.

You can filter the table by low coupons:

https://giltsyield.com/bond/

Albermarle

https://forums.moneysavingexpert.com/discussion/comment/82111190#Comment_82111190

If you have the full £50k, then on average you will win one of the Million Pound prizes every 100,000 years.

4justice2

Applied for an NSI online account at about midday (not had one previously) and paid £50 by Debit Card for Premium Bonds. No email to acknowledge. No NSI number issued. Internet search shows up to 10 days before they open an account. Are they always this slow?

Beddie

There are lots of Debbie Downers when it comes to PBs. I always did well out of them when I had a full holding, which I no longer do. Others will do less well, or better - obviously.

It's a personal choice for you to make. Why not try it for a year and see how you get on. That will answer your question as to "which is better?" for one year at least. One thing we can say - they are more fun!

Albermarle

https://forums.moneysavingexpert.com/discussion/comment/82113448#Comment_82113448

NS & I systems are generally a bit clunky.

kempiejon

https://forums.moneysavingexpert.com/discussion/comment/82111328#Comment_82111328

At 20% tax a few short dated low coupon gilts seem to offer a better after tax return than PBs' headline or adjusted expected prizes, obviously better for higher rate taxes. PBs have the chance of anything from zero to phenomenal returns exempt of any tax.

missile

https://forums.moneysavingexpert.com/discussion/comment/82114205#Comment_82114205

While gilts are safer than most investments, they are not completely risk-free. There are charges which will erode any gains. They are not tax free: Interest paid by a gilt is taxed as income.

kempiejon

Well, facetiously, nothing is completely risk free. I thought the chat was weighing the relative advantages of PBs verses cash and having taxable interest. If one concludes fixed term cash savings do not offer a valid increment in rate/incentives then looking at other fixed interest markets like gilts would be interesting. Some gilts offer a better return after tax for tax payers especially those on higher rate, so could be worth further understanding, especially if one has filled ISAs, PBs, SIPPs and maxed out available cash interest tax allowances.

missile

Thanks for your comments. I do understand, but do not agree.

Please note in my original post I did state:

I am a basic rate tax payer and expect to pay tax on my savings

I have maxed my ISA for 2026/7

I am not interested in any risk / longer term investment

Many thanks for reading and appreciate any advice