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I chose to invest in premium bonds for university, namely because of the decrease in interest rates. Also, my building society account was offering very little return and was so hugely inaccessible and was ran by some idiots who could never put money into my account without damaging the paying in book and each time I had to wait for a new one to be sent in the post. Consequently, I did some serious research, I figured that I still want my money to be fairly hard for me to reach otherwise I would have spent it all in a day. I soon realised that premium bonds were the ultimate investment as I was guaranteed all the money I put in and I had to chance to be a millionaire – Yippee!
WHAT ARE THEY?:
Premium Bonds are bought and sold under the operation of National Savings and Investments and offer 100% security because they are backed by the HM Treasury. A premium bond is a unit of £1, however, you must buy a minimum of a £100 at anyone time. Each unit is entered into a prize draw monthly, with each unit now holding a 1 in 30,000 chance of winning.
Each month the draw is divided amongst the winning bonds as follows by the random number generator ERNIE, who is checked independently checked by the Government actuary to ensure no cheating.
Higher Value – £1.8 million £1 million 1 prize £100,000 2 prizes £50,000 3 prizes £25,000 6 prizes £10,000 16 prizes £5,000 33 prizes
Medium Value - £1.8 million £1000 730 £500 2190
Lower Value – £32.9 million £100 11,129 £50 635,071
As I have said before the expected odds are 30,000 to one. In brief, if you bought 30,000 premium bonds i.e. invested £30,000 you would be expected to receive 12 prizes a year ranging from £50 to £1 million.
WHAT ABOUT THE TAX MAN:
All winnings are free from Income Tax and Capital Gains Tax and will not need to be stated on your tax return. CAN I BUY THEM:
Anyone can buy premium bonds so longs as they are over 16 years of age, otherwise a parent or guardian can buy them in their name. These however are non transferable. If you have changed address you must notify them, otherwise you will never receive your prize!! The address is: Premium Bonds National Savings & Investments Blackpool FY3 9YP
Equally if you do not know you’re holder’s number you can write to the above address (only those from 1976 will be on record!) You can also try to find out if you have won but your change of address meant you were unable to receive your prize.
You can buy bonds at your local post office and pay by cash or you can send cheque made payable to National Savings and Investments to:
You can go to your local post office and request a form to request to cash in your premium bonds, be warned this could take up to 15 days.
Well I've only just invested in them, this opinion is for how my situation stands with premium bonds, I have only been entered for one draw so far and no luck! Im still waiting for some bonds to be entered, who knows might get lucky! Fingers crossed
I will keep you posted on this, since I've had a lot of feedback requesting my personal gain - which is none as of yet.
Well worth investing in these if you can afford to put in 20 to 30 thousand pounds. How many do you have?
rosillew 23.11.2003 11:54
Very informative op; yes you used to be able to buy single £1 bonds, my parents bought me, my Sister and my brother £5 worth each when we were born over 50 years ago, I bought both my Daughters £10 worth each when they were born, but Ernie has never paid us out a penny, Heatherx
rosillew 23.11.2003 11:52
Very informative op; yes you used to be able to buy single £1 bonds, my parents bought me, my Sister and my brother £5 worth each when we were born over 50 years ago, I bought both my Daughters £10 worth each when they were born, but none of them have ever won anything, Heatherx