Premium Bond Winner ?

pbcpdeveloper

I have a Vanguard Lifestyle 100, I took some money out of Premium Bonds to top it up in the ISA when the markets dropped last year. 

But where do you draw the line. Isn't investing in a passive tracker like VLS100 a cop out when you could have invested in Tesla & Bitcoin.

grumiofoundation

Type_45 said:

pbcpdeveloper said:

The minimum stake for the lottery is £2 a week, play the lottery for a year and the reality is your will end up down £104.

The minimum stake for Premium Bonds is £25, play Premium Bonds for a year and the reality is you will end with £25.

(I am not totally sure what the question is anymore).

The question is this:

Is £50k in bonds for a year a cop out when you win next to nothing....   as oppose to £50K in a passive tracker such as VLS100 in which you will gain about 25% interest (£12,500 interest)?

1) VLS doesn’t pay interest 
2) You really shouldn’t be expecting 25% gains every year and there is certainly no “will” about it! 

Type_45

grumiofoundation said:

Type_45 said:

pbcpdeveloper said:

The minimum stake for the lottery is £2 a week, play the lottery for a year and the reality is your will end up down £104.

The minimum stake for Premium Bonds is £25, play Premium Bonds for a year and the reality is you will end with £25.

(I am not totally sure what the question is anymore).

The question is this:

Is £50k in bonds for a year a cop out when you win next to nothing....   as oppose to £50K in a passive tracker such as VLS100 in which you will gain about 25% interest (£12,500 interest)?

1) VLS doesn’t pay interest 
2) You really shouldn’t be expecting 25% gains every year and there is certainly no “will” about it! 

1) stop being pedantic 
2) we all know that

[Deleted User]

Type_45 said:

So it's like playing the lottery, only it ties up large amounts of your capital and you've even less chance of winning?

I played the lottery for years the most I ever won was £10/£20 once or twice. And I lost money on every play.

With PB I lose nothing but can win, but I admit it is kind of a lottery but you have nothing to lose. Unless you can think of somewhere else to put the money and earn more interest.

Type_45

[Deleted User] said:

Unless you can think of somewhere else to put the money and earn more interest.

Have you heard of the stock market?

grumiofoundation

Type_45 said:

grumiofoundation said:

Type_45 said:

pbcpdeveloper said:

The minimum stake for the lottery is £2 a week, play the lottery for a year and the reality is your will end up down £104.

The minimum stake for Premium Bonds is £25, play Premium Bonds for a year and the reality is you will end with £25.

(I am not totally sure what the question is anymore).

The question is this:

Is £50k in bonds for a year a cop out when you win next to nothing....   as oppose to £50K in a passive tracker such as VLS100 in which you will gain about 25% interest (£12,500 interest)?

1) VLS doesn’t pay interest 
2) You really shouldn’t be expecting 25% gains every year and there is certainly no “will” about it! 

1) stop being pedantic 
2) we all know that

1) Accuracy is important. As opposed to making misleading/incorrect statements that could lead to someone making invalid comparisons if someone treated them as accurate. 
2) Why did you say will then? See point 1). 

Edit: to keep on topic, no wins this month. Another month of missing out on that 25% you promise I will get…

[Deleted User]

Type_45 said:

[Deleted User] said:

Unless you can think of somewhere else to put the money and earn more interest.

Have you heard of the stock market?

Yes but you can lose money in stocks.

I have invested in that also but only very small compared to PB

underwhelmed_saver

Deleted_User said:

With PB I lose nothing

In the short term maybe, but PBs aren't a great investment once inflation eats away at spending power

My Dad is adament that the £10 he invested in PBs the 1970s or whenever is the safest investment he's ever made because he'll get his £10 back, even though a tenner doesn't buy you much as it did 4 decades ago!

Eco_Miser

Type_45 said:

If you've got £50k, and you have no plans for it, it should be invested. You'd need the risk tolerance of a church mouse to keep it in PBs.

However, if you have got plans for it PBs are a safe place to dump it until you actually need it, and at present the expected return is better than savings accounts.

PBs are also useful for those of us who have plenty in equities and don't fancy bonds at the moment.

Type_45

Eco_Miser said:

Type_45 said:

If you've got £50k, and you have no plans for it, it should be invested. You'd need the risk tolerance of a church mouse to keep it in PBs.

However, if you have got plans for it PBs are a safe place to dump it until you actually need it, and at present the expected return is better than savings accounts.

PBs are also useful for those of us who have plenty in equities and don't fancy bonds at the moment.

In fairness, outside of equities, I don't think there are many good options for cash.  Current accounts, savings accounts, cash ISAs and PBs all pay peanuts.  None of them beat inflation.


Gold ETC, silver ETC and crypto are other options.  Or buy physical assets (property, physical gold/silver...   but these things come with expenses attached).