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Should I put my house deposit into premium bonds?

(27 Posts)
SkyblueAnnie Fri 21-Apr-17 10:28:14

I should hopefully soon receive my share from the sale of the former marital home and will be looking to buy soon.

I want to clear some of my credit card debt and allow time for this to boost my credit score a little so I think I will be looking to apply for mortgages in 3-6 months

I will be leaving some in interest paying current accounts but thought I may as well put the rest into premium know it won't gather much interest but I figure it's safe and I might just win a million!

Does this sound like a good idea or is there a pitfall I'm missing?

Never dealt with this much money before so I'm feeling a bit nervous!

BarchesterFlowers Fri 21-Apr-17 10:33:33

We did exactly that last year when we sold and moved into rented while we waited for a house we wanted to buy to come along. No issues at all apart from we didn't win a million!

We did have several small wins though 😀.

meditrina Fri 21-Apr-17 10:36:40

It's not a bad parking place, especially whilst interest rates are low.

Don't just stick it in and forget about it though! Think about longer term performance, and enjoy the dream of winning whilst you work out everything else.

RockyBird Fri 21-Apr-17 10:39:07

My friend's financial advisor advised her to do exactly that due to low interest rates.

MovingOnUpMovingOnOut Fri 21-Apr-17 10:40:06

We have saved and borrowed some money for a new extension. It will take a while for planning etc so we've put the bulk in premium bonds. The return on instant access savings accounts was so tiny that the gamble on this seemed worth it.

Mrsmorton Fri 21-Apr-17 10:41:39

I do this with my tax money and win £25 more often than not which I just reinvest. The online system is good and you can withdraw it easily, takes about a week for it to hit your account when you withdraw it.

MovingOnUpMovingOnOut Fri 21-Apr-17 10:42:31

You should maybe factor in that you have to have your money in for a while before it is eligible for the prizes.

From memory it's a minimum of a full calendar month before a draw so can be up to 2 months. I've just bought some more and their first draw is June.

Instasista Fri 21-Apr-17 10:43:36

The chances are you'll earn less than you would in interest but we did the same and usually won £75-150 a month. The attraction was how safe it is

BarchesterFlowers Fri 21-Apr-17 10:43:52

Just worked it out 2.5% return in 11 months. Not bad and so easy to get hold of your £ while dreaming of a big win.

dalek Fri 21-Apr-17 10:44:02

We also did the same - a bit of fun with no risk for a few months - also had a few small wins - was always exciting when the envelope arrived

MovingOnUpMovingOnOut Fri 21-Apr-17 10:44:11

I do my tax money too grin

Mrsmorton Fri 21-Apr-17 10:50:29

They have an app where you can check if you've won, pp is right though, needs to be a full calendar month.

Owlish Fri 21-Apr-17 10:53:30

I have a Premium Bond grin. Yep, just the one, bought for me when I was a baby 50 years ago <totally irrelevant to thread emoji>

SkyblueAnnie Fri 21-Apr-17 10:53:41

Thanks for the responses everybody.

It's useful to know about the waiting period and the fact it can take a week to get the money back - I will factor this in. I had assumed it was instant ( and I would be a millionaire within the week!)

It still sounds like it is probably worth doing- even if just for the fantasy....

Interesting points about using it for tax money - it could be useful for Christmas and holiday savings too. I'd never really considered that before.

I am becoming a bit of an expert in debt. Will be a nice change to be thinking about savings instead!

Mrsmorton Fri 21-Apr-17 10:57:02

That's good news OP, sounds positive! I've also used it to hold money to pay off an interest free credit card, figured I'd rather have the chance to win than pay the card off early. It's a nice feeling having savings and the chance to win something!

BarchesterFlowers Fri 21-Apr-17 11:21:48

That is a fab idea MrsM. I am looking to buy new sofas and thinking of putting it

BarchesterFlowers Fri 21-Apr-17 11:24:18

Oops on a post office credit card I got for travelling / no feed abroad. They have written to me twice because I haven't used it. It is with our passports but I feel like I should buy something on it interest free.

We have had a card cancelled through lack of use before.

tethersend Fri 21-Apr-17 17:40:25

This is a really interesting idea. Is it really safe? Barring complete government meltdown/Armageddon I mean?

Although even that's seeming increasing likely grin

ShatnersBassoon Fri 21-Apr-17 17:47:29

We did this once with proceeds from the sale of a house and thought it was a bigger faff than it was worth. It would have been much easier to just let the money sit in savings until we could properly reinvest it. I just couldn't get excited about the minuscule chance of winning more than we'd have been paid in interest elsewhere.

MairzyDoats Fri 21-Apr-17 17:51:18

So glad I read this thread, I've got £70k just sitting in my current account (ex has bought me out of marital home) I'm going to be buying in 6-12 months so I didn't want to put it in savings where I can't access it quickly... This sounds like a great idea!

tribpot Fri 21-Apr-17 17:58:34

I hadn't thought about using it for my tax money either. I have a Santander 1-2-3 account so it's earning a bit of interest over the course of the year but wouldn't mind winning a million quid!

MovingOnUpMovingOnOut Fri 21-Apr-17 18:09:11

Safer than the banks!

It's really easy to set up. I did it online and it took 3 minutes. Then I just login to my account, click "buy more bonds" or whatever the button says, tap in my CVV code to take the money via my debit card and that's it. A couple of days later it debits my account but I have new bond numbers same day.

I have my prizes paid to my bank account and I get an email the day after the draw if I've won something or I can just look in my online account. I could have them paid back in but I prefer the almost negligible excitement of money turning up in my bank account.

There was a slight hiccup where they took two debit card payments by mistake and it took a while to get my money back but that was fine. They were perfectly reasonable and rang when they said they would, apologised etc etc.

I couldn't find a better instant access account when I last looked because the interest rates are tiny. I don't like the idea of lots of money sitting in my current account. I used to work in banking and I've seen the fall out from emptied accounts. Awful.

SkyblueAnnie Fri 21-Apr-17 19:20:12

It sounds like it might be a plan for a risk free flutter/bit of fun for the short term.

I've been thinking about what other regular savings it might be useful for.

For those if you using it for tax money/ credit card repayment etc do you find you are getting a similar return to what you might get on a fixed term bond or regular saver account? Or is it more just the fact that the ( miniscule) chance of winning big is worth losing the guaranteed interest?

DavidbowieMime Fri 21-Apr-17 21:43:58

I used to work in banking and I've seen the fall out from emptied accounts. Awful.

^ what does this mean please confused

MovingOnUpMovingOnOut Fri 21-Apr-17 22:00:05

Fraud. I've seen the impact of cloned cards and hacked accounts.

There are a lot of ways to move money out of a current account and very, very few from a savings account or premium bonds.

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