Premium Bonds - If you post to say how much you've won, please also say how much you have invested.

Derek W said:
Draws tomorrow so you'll be notified on the 3rd ;)
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Everything (including the NS&I site) say that it's the first working day of the month so it's already been drawn.

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Are people using premium bonds as they've exhausted every other beneficial place to put money (pension, isa, saver etc.) or as their main point of saving?

I always understood them to be (statistically) a fairly pointless place to put your money, as the majority of people see no return at all.
 
Just checked mine. I put £100 in two years ago, still have £100... Would have had £125 if I put it into my usual S&S ISA.


Also, wtf is up with that randomised keypad to enter a PIN. I think less of their security because of it...
 
I used to have about 700 in there from presents when I was a baby. I think I withdrew them when I was about 24. In those 24 years I won £50 two or three times. pointless.
 
The main downside is the impact of inflation, but as I understand it they do have some plus points:

Capital not at risk and secured by the government.
Tax free.
Average return theoretically 1.4% (although there is clearly an element of luck!).
Small chance of winning big.
 
Mr Badger said:
The main downside is the impact of inflation, but as I understand it they do have some plus points:

Capital not at risk and secured by the government.
Tax free.
Average return theoretically 1.4% (although there is clearly an element of luck!).
Small chance of winning big.
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Yeah I've got some money in premium bonds for those reasons. Better average returns than any savings account I could find when I put the money in. Yeah it won't beat a judiciously managed stocks and shares ISA, but there is no risk of losing capital like there is with stocks.

Could also look at it like a permanent lottery ticket except you can get a full refund on the cost of your tickets if you never win :p.

Obviously with hindsight just investing all my money in the S&P 500 would have been better and still relatively safe compared to picking individual stocks etc, but then I guess years of 'ooh you might lose money as well as gain' have conditioned me to want to keep some of my money 'safe'.
 
I think the biggest pro to it, is that it's a no risk investment. We have a decent amount in and have won 5 x 25 so far this year.

We know it's not the same returns as we may get elsewhere, but it's risk free.
 
Feek said:
Everything (including the NS&I site) say that it's the first working day of the month so it's already been drawn.

e58kSOO.png
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Prize Checker

Ready to see if you have won a prize? Enter your holder's number to check if you’ve won in this month’s Premium Bonds draw. Good luck!
www.nsandi.com www.nsandi.com

Prize checker updated tomorrow. The email follows a day later.
 
Mr Badger said:
The main downside is the impact of inflation, but as I understand it they do have some plus points:

Capital not at risk and secured by the government.
Tax free.
Average return theoretically 1.4% (although there is clearly an element of luck!).
Small chance of winning big.
Click to expand...

Yep, premium bonds are basically saving, with your funds back into your hands within about 5 days.

They are not, never were nor will be an investment, they are savings.
As you say with a tiny chance of winning a life changing amount of money.

The return on premium bonds is however lower with lower investment on average as the chances of picking up one of the decent prizes is so low that unless you are incredibly lucky you will see less than the headline return by a significant amount.
I can't remember the point but its something like £30k where over a half decent period you should only fall very slightly below the headline return number, less than that unless your incredibly lucky you stand an every increasing chance of seeing noticeably below the headline number.
 
JamesH85 said:
I think the biggest pro to it, is that it's a no risk investment. We have a decent amount in and have won 5 x 25 so far this year.

We know it's not the same returns as we may get elsewhere, but it's risk free.
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Its not an investment. Risk free, but not really because its being inflated away. If inflation stays well above target that is super corrosive. Suitable place for your cash buffer but 'risk free' is a bit of a red herring.
 
I think if you need access to the money medium term (<5 years) then premium bonds aren't actually that bad if you have a big lump to deposit. For example right now from a quick look the best savings account is 5% (Yorkshire building society) with strings attached: Must be a customer already, can only deposit £500 a month. Most are in the 1.5-3% range and also have low max deposits meaning if you were saving for something like a house you'd end up with a lot of open accounts which is a hassle to administer. Whereas with premium bonds you're basically accepting a ~1% return on average (with a big lump sum in there) with a small chance you could get lucky. You could obviously do a mix of both and clean up the best interest rates + enter the lottery of PBs...

If you don't need access to the money any time soon then dependant on your personal risk tolerance some form of stocks and shares investment is going to be the way to go.
 
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