Premium Bond Winner ?

caveat_emptor

tomstickland wrote:

National savings quote an average return of 3% for premium bonds. A high interest savings account is better. Unless you enjoy the chance aspect, but if at any time you're ahead of the 3% then you are more likely to have a void period to get you back down to the 3% average.

The 3% return on total funds has just been cut to 2.95%.

Jays

caveat_emptor wrote:

The 3% return on total funds has just been cut to 2.95%.

I found an explanation for the above in the Sunday Times Money Section today:

Essentially the article says from 1st June, the National Savings & Investments (NS&I) is cutting the total monthly prize fund from £76.6m to £75.4m.

This means there will be one fewer £50,000 prize and two fewer £10,000 prizes. The number of £100 prizes will be cut by more than a third from nearly 64,000 to fewer than 42,00.

The odds of winning any prize will stay at 24,000 to 1, because the slice of prize money used for £50 prizes will increase. The good news is there will still be two £1m jackpots each month.

The overall effect will be to reduce returns to the average investor. From June 1, a bond-holder with average luck will in effect earn 2.95% on his or her money, down from 3%. The article points out as the returns are free from tax, a prize of 2.95% is equivalent to 3.69% on a taxed account for a basic-rate payer and 4.91% fora top-rate payer.

The chancellor is being blamed for the cuts as over the past year there has been a small increase in the number of higher-rate taxpayers investing in premium bonds. This increase the tax loss to the Exchequer and therefore, the NS&I has to adjust their rates to take this into account, as in 1998 the Treasury introduced a policy which forces NS&I to cut rates if the Exchequer is losing too much money.

halloweenqueen_2

Aah - now we know where the pension money is coming from for the post office that disappeared.

pickle

I thought that there was a set return and I quote from the NS & I pamphlet "We set the size of each month's prize fund by allocating the equivalent of one month's interest on the total value of eligible bonds, at the annual rate shown below.....from 1 September 2005....Interest Rate 3%". No further advice has been sent to me regaring any change. I would have thought that the total amount of prize money would have increased as savings rates are so poor and premium bonds more popular. But I note what you're saying Jays...hmmmm. Why should shortfalls in the Exchequer be covered by the prize amount of premium bonds? The Exchequer are getting the benefit of using the Premium Bond money at a lower than commercial rate anyway I would have thought.

Kazza242

The high value winners list for June is now available via the NS&I website:

http://www.nsandi.com/products/pb/winnerlist.jsp

trademark

5K Blocks of bonds have done well this month ........

Thefunkygibbons

I like the £25k win for that £5 bought in 1961

That is a great return

meanmachine_2

THose of us looking for the £50 crumbs will probably have to wait until Monday for an update.

*sigh* Another month at the chalkface for me then...

TrickyMicky_2

Well this month is another to prove you can get nowt out of 28k yet again, 2nd month in draw with 28k and 2nd month a blank, how does this go towards the prove that "new bonds win more" theory, also this month has just reduced the prize draw so looks like I will have to help with the reduction in the prize and move my money. or buy a boat or somthin and enjoy it.

TrickyMicky_2

Monday I cash in my bonds with sugar on.