NS&I Premium Bonds

[darasda]

Hi everyone,

This has probably been asked before but are premium bonds worth the bother? I have maxed out ISAs etc and regard myself as fairly savvy.

My question is specifically about PBs. Compared to other similar accounts to park about 10-15K, with interest rates at around 0.5% ie nothing.

Is the juice worth the squeeze as it were?

Thanks in advance,

Hi have a look on here www.mumsnet.com/Talk/legal_money_matters/4237465-PREMIUM-BOND-THREAD

I have max holding and get £50-100 almost every month. It seems a pretty good place to store money you might want quick access to.

I'm not sure what you mean by "the hassle"? You have to do the usual proof of ID stuff at the beginning and then you just get a monthly email telling you if you've won, or you can check on the app.

I keep my 'three months emergency money' in premium bonds. Easy access online with a slight chance of a bigger payout.

Bear in mind that although they are safe, in that the capital will always be returned, inflation means that the capital will erode over time, do not great as a long term store of value.

My ISA's are maxed out too so the rest is in PB's. When I had close to max holdings I won £25-75 a month and one £1000! Even with less than half the max in I won £25 this month. Transfer in and out online. Dead easy.

If you can find an account paying 0.5% then you get 0.5%. If you put it in Premium Bonds you may get a winning or you may not.
I have over £20k in and have not had a win for several months now. Some months I have won £25. It's pot luck.

If you want a guaranteed return then don't use Premium Bonds. If you are happy to risk the interest for the possibility of getting a winnings that may be higher, or lower than the interest, then do it.

Thanks all,

What I meant by hassle is yet another account that you set up and monitor etc. Of course it's first work problems and it's not really a hassle. I think I'll open one. Seems it'll be better than the current eSaver which is rubbish.

I have 15K in it and its been giving me 41p interest a month for months. 41p!!

I've got some money invested with the intention of overpaying the mortgage in January (already maxed out mortgage overpayments and ISA allowance for this year). The interest is hardly worth bothering for (less than inflation) but slightly better than pretty much any other easy access account. Also 100% guaranteed by the government. Good if you're looking for a relatively short term place to park money or keep emergency funds but not a good investment per se.

@darasda

Thanks all,

What I meant by hassle is yet another account that you set up and monitor etc. Of course it's first work problems and it's not really a hassle. I think I'll open one. Seems it'll be better than the current eSaver which is rubbish.

I have 15K in it and its been giving me 41p interest a month for months. 41p!!

I've got £30k in PB and get at least £25 most months, the most I've had is £100, which I've had a few times although of course some months I get nothing.

I've just looked at a spreadsheet I did to log winnings and it turns out I've had £1375 in 4 years of investments, so average £28.65 per month, a fair bit better than the equivalent 82p you're getting!!

I know they are going to change the payouts again for premium bonds soon so the likelihood of winning will go down (again).

DP has max holdings and definitely doesn’t win every month. He won £25 this month, £75 the ninth before, but didn’t win for two months before that. So I’m not sure how well he is doing by comparison to a savings account where you pick your money up for say 5 years.

I have half the money in premium bonds that he has and have made £100 since December.

We bought £50k PB's in March this year and have had a win every month. Our winnings currently total £300.

*lock

Its fairly easy to set up and monitor - can do online and link to bank account / e-mail etc. It is only 0.5% interest on average, some will get more, some less.

I have £50k in since Feb and have won £75. If you look on Moneysaving expert there are other accounts paying similar amounts of interest. For smaller amounts there are sometimes special accounts - I have one for £1000 paying 3% and one current account transferred I get equivalent of 3% on £5k. Both offers not sure if available now but Moneysaving expert will list all current offers.

There is nothing to monitor as such with a Premium Bond account.

However, we have three X max Holdings and not every holding wins every month. I did a calculation recently which shows we are on track to receive equivalent of 1 percent.interest.this year, but.the.interest doesn't compound like a normal account.

I see it as a short term (6 - 18 months) place to park savings.

I found premium bonds one of the most straightforward of accounts to open/manage/withdraw from etc.
Also have other interest attracting bonds with them.
Winnings have worked out more than any savings account interest rate I’ve come across but not compound interest as pp says - I’d not thought of that before. Many months no wins. potential winnings weren’t a reason to invest, for me.
See them as safe guaranteed way of protecting lump sums. Supposedly short term but I can see mine being longer term usage.

Only use PB for the short term cash or a place to park. If ISA’s are full then a GIA is more sensible for medium term savings

@darasda

Hi everyone,

This has probably been asked before but are premium bonds worth the bother? I have maxed out ISAs etc and regard myself as fairly savvy.

My question is specifically about PBs. Compared to other similar accounts to park about 10-15K, with interest rates at around 0.5% ie nothing.

Is the juice worth the squeeze as it were?

Thanks in advance,

You need 30K as a minimum for the odds to be worthwhile. Any less is probably better off being split acrossthe highest interest accounts you can find