How much do you save into Premium Bonds?

[MsGiGi]

My Cash ISA bonus interest rate expired this month, so I deposited my Emergency Fund into Premium Bonds instead.

I have £2,950 in there at the moment and I save £27 of my wage each month into PBs.

What about you?

Full holdings but literally only because I'm maxed out on isa allowance and Im a top rate tax payer. Once April comes around I will move £20k into the isa.

In general, premium bonds are a really poor way to hold your money.

You should instead just move your isa

I’ve thought about it, but I won £100 last month, which is more than I would have got from a Cash ISA for an entire year. I ended up moving the rest of my Cash ISA into PBs then.

It’s the easy access of them that appeal to me too.

OK.

You should never ever move money out of the protective tax wrapper of an isa. It's a really bad financial decision and to put that money into premium bonds is just like playing the lottery (albeit that you don't lose the original stake other than through inflationary depreciation).

In total with DH we have £75k in premium bonds but its only a temporary holding place until we can put more into a stocks and shares isa.

If you still have isa allowance available for this year I would move that money today straight into a trading212 ISA. Cash ISA initially if you want access but longer term a stocks and shares isa is likely to be far better in terms of long term return.

I bought a £100 Premium Bond about 30 years ago. Then a few years ago I decided to stop doing the National lottery and instead buy a Premium Bond monthly.So I made a standing order for £25 month which I very recently upped to £50 a month. And I've purchased a few extra when I've had a bit of spare money.
I'm up to £ 3000 now.

My original bond got me one prize of £100 in nearly 30 years. But since I started buying bonds regularly I've had a further 2 £100 prizes. So I'm quite pleased.
I don't think I won more than a fiver on the lottery, and that very rarely, and at least with the bonds I keep my capital and have a bit of a chance of winning something worthwhile.

Edited to say I do have a variety of other types of savings. This is my " fun" savings.

I hear you.

I already have a S&S ISA and a SIPP. The money I have in PBs is my Emergency Fund (hence why I want this money to be easy access.)

I don't have any but DH has about £20k, mainly because if he didn't his savings would be languishing in a very low interest account as he hasn't much interest in savings accounts and moving money around and PBs seemed a good option for him as he can just put money in then forget about interest rates and stuff like that.

Premium bonds is the fastest way to erode the value of your capital apart from keeping cash in a box under your bed. Just put it in a high interest savings account that is easy access. There are still plenty of them around. You have £1000 a year allowance for interest before it is taxed. You may never win premium bonds again whereas at least you are getting interest each month in savings. Unless you have 10s of thousands in PB they are never going to give you a decent return. You could have full holdings and never win a penny.

I don’t think it’s possible to have full holdings and never win a penny. I have 15k and win about half the time, and not just £25 either - I’ve won £150 some months

Maximum amount because it’s a quick access emergency cash fund.
i already have maximum in an ISA.
I’ve won over £500 on the PBs in the past year — more than I could earn in savings.
May my luck continue…

Of course it is. Plenty of people have full holdings and dont win. Obviously they have a much higher chance due to the sheer number of bonds they have in the draw but it's by no means guaranteed.

If you have full holdings of £50,000 then thats a very poor return of around 1%
An easy access account paying 3.75% would give you more than three times that.

It’s a pretty good return (tax-free) over 4 months though. My winnings go directly into a savings account.

We both have FH of PB's and have done for many years (we also have ISA's & other investments).
PB's have always been good to us but this past few months it has got very sparse with Sept winnings being only £200 (our lowest for yonks) and nil in Oct.😭

I am keeping all my PB's but my OH has opened another ISA and is moving £20k out of PB's after the Nov draw.

I know PBs aren't the best was to save money, but mine are averaging 4.3% this financial year, so I can't complain 🤷

Premium bonds only really make sense if you have a significant amount (full holdings or getting that way), you are a higher or additional rate taxpayer and you already use your savings allowance or don't have one. I had full holdings at one point (wanted accessible cash as we were doing a big building project) and made about 5%. I've now sold them all bar £120 for sentimental reasons (my Granny gave me £10 a year in premium bonds for 12 years when I was little so I like to keep those, although of course now they are different bonds).

Do you mean ‘don’t win every month’ or ‘never win, ever’?

You said in the past year. You cant take a 4 month period and pretend its the same as a years return. You just happened to be lucky for 4 months out of a 12 month period.

I mean what i said. Some people may have full holdings and never ever win a single penny for the entire time they have full holdings. Others will be luckier.

I tend to use it as extra cash, it's down to about £15,000, I may top it up or keep taking out when needed for a better rate somewhere.

It’s possible but it’s vanishingly unlikely. You’re far more likely to win the jackpot than win nothing for ten years.

I’m down to £20k as doing a building project, it was maxed out before we started

Until recently full holding and achieved 3.8 % which is better than a 5% bond - withdrew £12k for a new car but have won every month for 14 months now

This is more my experience with PBs and I (a) haven’t got full holdings and (b) am not that lucky