Premium Bonds

  def90csw 14:55 08 Oct 2006

So are they worth it, your bonds get into each draw every month and you could win up to 1 million Tax-Free!

  DieSse 15:19 08 Oct 2006

Depends whether you consider gambling away the interest you could be getting is a good thing.

As with all gambling - harmless on some levels, - harmful if taken to excess.

  namtas 15:20 08 Oct 2006

Premium bonds! bit of a lottery really.

  Jackcoms 15:28 08 Oct 2006

"bit of a lottery really."

Not at all.

Because with Premium Bonds you can always claim your stake money back; you can never claim in back with Lottery tickets

  GRFT 15:58 08 Oct 2006

You now have two chances per month to win £1m, and it isn't really gambling in that your money is safe and can be withdrawn any time.
I've found that the several £k invested returns more than it did when I had PEPs of the same value. The prizes come in steady £50s but a couple of years ago there was one of £1k, and I'm still waiting on the biggie!

  spuds 16:41 08 Oct 2006

I have had premium bonds since the day they started. Never won anything, but I know people who have. Not lost anything really, except possibly some low bank interest rate, on the amount of bond's I hold, but the value is still there, when and if I cash them in, not like the lottery.

  namtas 16:53 08 Oct 2006

Gosh, come on guys, do we have take it all said so literally?

  DieSse 17:15 08 Oct 2006

*it isn't really gambling*

It is really gambling. The money you are gambling is not your holdings - the stake is your interest, which you would get if you invested it normally.

Say you have £1000 in bonds - which would normally earn you approx, say, £40 in interest. Then your stake is not £1000 at all - it's £40, which you gamble away each year.

Remember the winnings are not based on the £1000 - that's always yours - the winnings come from everybodys interest - the £40 in this illustration.

It's no different at all from putting £1000 into a building society, and spending £40 on the horses (or the dogs, or the lottery!)

  robgf 01:11 09 Oct 2006

I have had £20,000 worth for the last ten years or so, they used to be quite good, at least matching the building society interest, sometimes exceeding it.
But since they have increased the size of the maximum prize to one million (it used to be 250,000), the number of small prizes have dropped in numbers and I have noticed a significant drop in return.
So much so, that I have decided to cash them in after the start of December. (there is a larger draw in December)

With the larger main prizes, they are no longer a steady investment and I would not advise buying a large amount, as the return from an ISA, or building society will probably be better, unless you are very lucky.

Out of interest, I have had one, one thousand pound prize and two, five hundreds, over the years. The most I have won in one year is £1450. But that was exceptional, this year £250 so far, which is dire.

  def90csw 11:07 09 Oct 2006

The £500, £250, £100 & £50 get posted this week so fingers crossed;-)

  pj123 12:27 09 Oct 2006

robgf, "ERNIE" says that if you hold the maximum amount of bonds you can/should win a prize every month. Is that not true now?

I only have £1000 bonds (which ERNIE says "a prize about every 14 months). Since 2000 I have only had 3 x £50 and the last one was December 2003.

Maybe next one, November 2006?

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