AIBU to consider putting all my savings into premium bonds?

[sheshootssheimplores]

I used to have premium bonds and would occasionally win £25. Then the recession hit and lots of people decided to put their savings into PB and the likelihood of winning was massively reduced.

I cashed them in and put some in a savings account and some into ISAs. Now the interest rate is so chronically low and every year it goes down some more that I’m wondering if I should just put them back into premium bonds. M

I have around 20k. My other choice is to tie it up for five years or so but that does worry me a bit incase I need to access the cash 🤔

The winnings are all tax free so it is very attractive if you are over the savings interest of 1k tax free.

The returns are pants. Buy some shares with good dividend and forget about them.

Don't put money in a stocks and shares isa if you want to use it in the next few years. If you need the money at the wrong time, you could lose out.

On £20k you need to be winning £25k every month on average to match a standard instant access savings account and that's quite unlikely, so you're gambling guaranteed interest.

Money saving expert has a really good thorough explanation of how the payouts compare with a cash savings account.

£25 every month of course.

I had 30k in for 6 months once and won bugger all

Most of my savings are in PB. I win several times a year.

I know my money is 100% safe which is important as I am very risk averse. Interest rates are so pitifully low, I have calculated that my winnings over the past year have been triple what I would have earned in interest.

Most important of all - I might win the Big One! and sometimes that keeps me going!!!

HPandthenever
They look good but I’m not a first time buyer - looking for a BTL property - We are lucky that the rental market in our town is brilliant.

I’m currently saving for DS using both Santander’s and first directs regular saver accounts - they pay 2.5% and 5% respectively for the first year as long as you have current accounts linked to them. there is a max amount you can save though.

I was very lucky to receive a large inheritance in May. I researched the best interest rates on MSE and split it up between fixed rate and limited access accounts to reduce the risk. Martin Lewis gives excellent advice.

I’ve just read MSE’s article on P2P lending. I know Martin is very risk averse, but it still doesn’t seem worth the risk for returns that aren’t that great.

I was gonna put £3000 into PB, instead i choose to do matched betying, after 4 months im £1200 up

I keep reading about matches betting and yet still, I do nothing!!!!!!! 🤦🏻‍♀️

*matched

My dad did something similar a few years ago. He was offered an interest free loan of 10k for 6 months from his bank. He took it, bought 10k worth of PB then cashed them in after 6 months and paid his loan off he won more than the interest would have been on 10k - not masses more I might add

It’s worrying how many people recommend PBs on the basis that it’s fun. Is that really a consideration in your financial planning?

There are much better places to invest. Personally I would look at investing in something relatively safe like S&P 500.

I have been gradually removing money from P2P lending. The returns are less than half what they were 10 years ago and the money is at risk, ie not covered by any compensation schemes.

We just put £50k in premium bonds and won £150 on the first draw!

We have £30k in there and win £25-£100 almost every month.

I've had 5k in premium bonds for 12 years, I have won exactly once, £25.

I've had £10k for the last few months and also won one £25 prize, but I need to win £25 every other month just to match the interest rate my current account pays.

But so far it seems that I don't enjoy the above average luck reported by other Mumsnetters - you have my share of the prizes you lucky people.

I'm currently debating whether to leave the £10k in there (probably) but look to build up some money in a stocks and shares ISA as I have a vague 15 year ish plan to save enough to supplement the small pension I will receive at 60 so I can afford to retire then instead of working until state retirement age.

It’s worrying how many people recommend PBs on the basis that it’s fun. Is that really a consideration in your financial planning

For the fairly minor difference it would make to our finances overall, yes. It's like why people do the lottery!

It’s worrying how many people recommend PBs on the basis that it’s fun. Is that really a consideration in your financial planning?

I’m not sure why other people’s financial planning causes you worry, tbh.
For us, the difference between a return on PB with average luck and potential interest earned on a comparable high street bank product (i.e. instant access, not a regular saver etc) was about £100 in a year. We decided it was worth that for the potential higher earnings, and yes, for the fun of being in with a small chance of winning big.

It’s a part of our overall financial planning - we have good regular savers accounts, a good interest rate on our current account, cash back cards and on our current account, and are looking for a BTL property to buy in our area and the potential yield is so good.

Don’t assume that because people don’t invest as you do, that we aren’t savvy with our finances.

Then the recession hit and lots of people decided to put their savings into PB and the likelihood of winning was massively reduced.

The number of people putting their savings in makes no difference. The returns may have gone down due to interest rates being cut though.