Premium bonds

[Wouldyougivemeamortgage]

Would you buy premium bonds? There doesn't seem to be a downside, does anyone know of any?

I have a small savings pot that needs to grow so I can buy a house. My savings are earning nothing in the bank so thought I could transfer to premium bonds, even if I win £25 it's more than I'd get in the bank.

Anyone have any experience of them?

[GreenTulips]

I’ve had £100 worth over 15 years

Not one anything

No interest either - not that it would be a lot anyway

[GreenTulips]

Meant to add there are LISA - available which add 25% to your savings for house purchases have a look on money saving expert

[Remembering39862]

Most of my savings are in premium bonds, and I usually win at least £25 a month.
No downside as far as I’m concerned, you can remove the money easily if you need to, and as you say any winnings far outmatch bank interest!

[Twospaniels]

Well i have had £100 worth for about 50 yrs and have never won a penny.

However, my friend has the maximum you are allowed to have (£30,000 ?) and gets wins every time. It earns him more interest that a savings account would (pre covid % rates).

It’s probably worth a go, you certainly won’t lose anything.

[Saucery]

Chances of winning anything are very low, but they’re not going to win anything at all in a savings account so I put spare savings in there ‘just in case’. You can always get them back out again if you need them.
Online is really easy, you just nominate an account you want winnings paid into. You get an email and when you log on it gives you the choice of paying into account or reinvesting in PB.

[GreenTulips]

www.moneysavingexpert.com/savings/lifetime-isas/

Here

[TumbledGlass]

The downside is not earning any interest and no guarantee of winning. I've had them for two years and have won £25 x 8.
Gradually I've increased my investment, at the moment I've £11.5k, I think I had £4K in when I first won.
DH won £25 with only £200 invested.

On MSE website there's a calculator that shows if you've been lucky/ unlucky comparing wins to traditional savings.

[ChessieFL]

The only downside is that you might never win anything, and on that basis you would be better off having your money in a ‘normal’ account which would earn some interest, although not much at the moment.

For me, interest rates are generally so low it’s worth the risk for me that I might win nothing on the premium bonds, because I know there is a chance that if I do win something it will exceed interest rates I could have got elsewhere.

[Wouldyougivemeamortgage]

I'm too old for a LISA sadly.

Ive been thinking about it since January and need to get it sorted, not sure why I'm hesitating.

[Gingefringe]

I have £9k in Premium Bonds and probably win around 6 x £25 each year. I've had them for about 5 years.

[Wouldyougivemeamortgage]

Is it possible to win big on them? Not that I would, I'm the world's most unluckiest person but it would be nice to dream.

[PaperMonster]

I’ve had £105 for 50 years and I win something every couple of years. Just bought daughter some.

[HelpMeh]

They're alright in that they're low risk but unless you have a lot invested the returns will be minimal. Even with a full holding (50k) some months yield nothing or one measly £25. The most I've ever had in a month is £175 and I've had them for quite a few years.

[Pukkatea]

I've had 1000 pounds in there for 12 years and I've won 50 pounds overall, both in the last year. I like it as a little pot of money that is a bit more difficult to touch than my accounts.

[billybagpuss]

www.moneysavingexpert.com/savings/premium-bonds-calculator/

This is quite fun to play with, I bought some a couple of months ago, and considering the amount I’d earn over a year in the bank is 25p it’s a lot better odds than the lottery

[Spasiba]

When I was self employed I used to save my tax money in premium bonds. If I won (rare) the money went straight into my personal account. PB wins are tax free.

[CustardySergeant]

I have the maximum £50K in Premium Bonds and there's only been one month since buying them that I haven't won anything. Sometimes it's only £25 but usually it's multiples of £25 meaning that several bonds have won. I bought them because interest rates are low, there's no risk and they are easily accessible if I need any of the money.

[MadFerretWoman]

I got my retirement payment in 2008 When bam
Bus were crashing so put the lot into premium bonds... I make about 25 to 50 pounds a month in wins... sometimes more... never big... but it’s a lot better return than an isa at the moment. You need about 15k to get regular wins though...

[MadFerretWoman]

Banks! Not bam bus... 🤦‍♀️

[Murinae]

Yes you can win big. Top prize is a million I think. They are a very safe Investment and a bit of hassle to get the mine back so stop impulse buying. I have some and win a bit every now and then. It’s fun when you get the email saying you’ve won but not how much!

[ButtWormHole]

I think they’re great as a diverse savings and investments portfolio.

I have a LISA (for my pension), ISA (stocks and shares), instant access savings and premium bonds.

The downside is that they won’t increase with inflation like stocks and shares should.

[AdaColeman]

Perhaps think about doing a mix of Premium Bonds and Fixed Term (eg two years) Bonds?
As the interest rate falls, so the rate/number of PB wins/value of prizes drops in direct proportion.

It's a clever move to call them "wins" and "prizes" as if they were simply called Interest, no one would buy them!

[Villanemme]

Had 7k for 30 years. The first 5 years, at least one win a month, the next 5 years a steady 250/300 a year. The last 20 years lucky to win 50 a year. I would love to know the algorithm or am I just unlucky...

[HollowTalk]

It's really not a hassle to take money out again, it's just that you have to wait a day or two.

[UrsulaPandress]

I've got quite a few and used to win every month, but since the chances have been downgraded I notice I am not winning as much. However, i have other money in Stocks and Shares and at the start of the Covid Pandemic I lost about £8,000. It is slowly climbing back up but I am still £3000 down. I am totally risk averse and knowing that my premium bond money is completely safe and free from the vagaries of the market makes me feel better.

My financial adviser used to poo poo my bonds but has changed his tune over the last year.