Premium bonds? Worth it?

Its worth a punt at least. I've had £1200 in for 3 months and won £25 this month. I'm just building the money up till i can decide what to do with it.
 
D.P. said:
I know how the maths works, the point i was making is that the majority of people have relatively little in PBs, and thus have very low likelihood of wining. the stats I saw indicated that the median was zero. So if you won £25, you are doing better than 50% of the PB owners. This is probably just a reflection of a few hundred thousand people being gifted £100 PBs at some point etc.
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I doubt the median holding is only a few hundred pounds. The minimum to open is £100 for starters and people don't go to the effort of making savings accounts a few hundred pounds and then not add to it.

Here's an interesting article.

https://www.ft.com/content/2975b7b4-5c70-11e5-9846-de406ccb37f2

845,000 people hold at least £30,000 in premium bonds. It's not like these people are the 1% holding 90% of bonds. They only hold 50% of all bonds.

Think about how many people hold premium bonds period with non-zero accounts, and it is unlikely that if you model a distribution of holdings where 845,000 hold at least £30,000 that the median holding becomes less than £1000.

Often in threads we are discussing people trying to save a not insignificant sum of money. If it is small then the difference between 1% and 3% is still naff all.
 
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Me and my wife have some premium bonds, it's a bit of fun, each month whoever wins most gets to annoy the other.

The return is more or less in line with a savings account but is tax free and also guaranteed by the gov so no chance of a bank failing etc.

I'd stick money into an index fund before bonds but it depends on your own attitude to risk/reward/fun.
 
kinetic747 said:
Easiest option is to buy them online at NS&I. :)
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NS&I it is. They were in the FT link muon gave as well. I might as well chuck in a grand, as inflation isn't too bad at 2.4%.

How does inflation work with these?

If I put in £1000 for example, inflation goes from 2.4 to 3%, what would I lose after a year?

Is it 0.6% of each £1 bond X 1000. So 0.6 would be about £60?
 
helpimcrap said:
NS&I it is. They were in the FT link muon gave as well. I might as well chuck in a grand, as inflation isn't too bad at 2.4%.

How does inflation work with these?

If I put in £1000 for example, inflation goes from 2.4 to 3%, what would I lose after a year?

Is it 0.6% of each £1 bond X 1000. So 0.6 would be about £60?
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Your name really suits you doesn't it......

Premium bonds are like playing the lottery, if you numbers come up you win.... I would say its not that complicated, but you seem completely incapable of learning for yourself
 
Haze said:
Your name really suits you doesn't it......

Premium bonds are like playing the lottery, if you numbers come up you win.... I would say its not that complicated, but you seem completely incapable of learning for yourself
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I was asking about the inflation because I've never had to deal with that and that's a potential loss. Eyes open.

Cheers for ignoring my question.
 
Just checked where I am storing money at the moment, there are wins but usually £25

Draw date
Bond number
Prize value
July 2018 £25
May 2018 £25
April 2018 £25
Draw date Bond number Prize value
 
helpimcrap said:
I was asking about the inflation because I've never had to deal with that and that's a potential loss. Eyes open.

Cheers for ignoring my question.
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Inflation doesn’t literally take money away from you if that’s what you’re getting at.

£1000 in a years time will still be £1000, just you won’t be able to buy the same amount of stuff with it. If you get 1% return on your savings and inflation is 2% you will still be ~1% down on where you were at the start of the year in real terms.
 
Jokester said:
Inflation doesn’t literally take money away from you if that’s what you’re getting at.

£1000 in a years time will still be £1000, just you won’t be able to buy the same amount of stuff with it. If you get 1% return on your savings and inflation is 2% you will still be ~1% down on where you were at the start of the year in real terms.
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What I was thinking is, if I put £1000 in now, inflation goes up, when I withdraw it would be worth less.

I can put in £1000, can withdraw £1000 regardless in 1yrs time and it is literally worth less in real world sense because store prices have gone up.

Thanks for the explanation.
 
Where does the money come from to pay prizes? Tax payers? You'll all be getting called benefit scroungers next.
 
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