NS&I GEB issue 15 - Worth it?

scottish_lassy

I see the new NS&I GEB issue is out. Does anyone know whether this is worthwhile. Thinking of changing from Premium Bonds to this. Opinions??

6022tivo

Only thing is the Premium Bond winnings are Tax Free, the GEB is not and will be taxed, and also will have to be declared for tax credits and that..

dunstonh

Premiums bonds are rubbish. The terms of this GEB are poor compared to others (although most of them are poor). So, basically both premium bonds and this GEB are poor options.

isofa

dunstonh wrote: »

Premiums bonds are rubbish. The terms of this GEB are poor compared to others (although most of them are poor). So, basically both premium bonds and this GEB are poor options.

Totally agree re GEBs, I'd avoid them.

Re PBs, this has been covered in detail on many threads, as a true "investment" they are poor, however it depends on your luck! I've been beating easily the top available interest rates (gross) for the past 2 years with my PBs, and the "wins" are tax free so personally I'm happy and it's a bit of fun. But I certainly wouldn't recommended as a main "investment" (unless I win the million of course )

At least with PBs the only risk is your capital losing value as inflation rises...

John_Stone

You should work out how much you have won on the Premium Bonds and whether it has been worth it.

Another factor is whether you have money invested elsewhere or this is you main savings.

I had a couple of large wins on the Premium Bonds in the last few months which led me to review what return I had had on them.

Over the past ten years I have had a return of about 8.8% annually which as a higher rate tax payer is extremely good. If I take out the two recent large wins then the annual rate is around 3% annually which for a higher rate tax payer is not bad.

The moral I guess is take the long term view and that premium bonds may be great or may not be very good at all as an investment - a bit like stocks and shares.

6022tivo

You also have a chance (small) of winning a Million...

The waiting of a special man in black knocking at my door every 1st of the month keeps me going..

dunstonh

I have no problems with Premium bonds for a higher rate taxpayer with hundreds of thousands but more often than not its the small saver/investor who has premium bonds who could do a lot better but is holding out for winning draw.

Ask yourself this, would you put the money in a high interest account then draw the interest each month and buy scratchcards with the interest? That is effectively what you are doing with premium bonds but the Govt is getting the real winnings and not Camelot.

Jonbvn

dunstonh wrote: »

I have no problems with Premium bonds for a higher rate taxpayer with hundreds of thousands but more often than not its the small saver/investor who has premium bonds who could do a lot better but is holding out for winning draw.

Couldn't agree more. PB's are by far the most used "savings" product on the market. This surely means a lot of people are using them as their main method of saving.

royeee

Jonbvn wrote: »

Couldn't agree more. PB's are by far the most used "savings" product on the market. This surely means a lot of people are using them as their main method of saving.

Or they win nothing and forget they've got PBs floating around.