Premium Bond warning issued as time savers have to wait to win prizes shared
Around 22.7 million people hold bonds, making them one of the UK's most popular savings products. At the end of 2024, around £127.7billion was in Premium Bonds accounts
Premium Bond savers could be forced to wait over three years for a win, new analysis has revealed. Premium Bonds are a type of savings product run by NS&I - but instead of earning interest and getting a guaranteed return on your money, you're entered into a prize draw each month. The prizes range from £25 to £1million.
Around 22.7 million people hold bonds, making them one of the UK's most popular savings products. At the end of 2024, around £127.7billion was in Premium Bonds accounts.
You get a unique bond number for every £1 invested, and you can invest from £25 up to £50,000 in total. The overall theory is that the more Premium Bonds you own, the more unique numbers you have entered into the draw - so the more chance of winning.
According to the NS&I, each £1 bond has a 22,000-to-one shot of winning anything, and on average returns are 3.8% a year at the present prize rate. However, nothing is guaranteed.
Information which has come to light through a Freedom of Information (FOI) request from the wealth management firm Octopus Money, found that nearly 440,000 holders won a prize for the first time last year after holding Premium Bonds for around three and a half years on average.
This is a contrast to the beliefs of Premium Bond holders, with over a third of 678 surveyed by Octopus Money saying they expected a prize within the first six months.
The reason for the long wait is likely due to people only holding a small amount of Premium Bonds. On a £25 to £100 investment, the return of 3.8% would give you nothing so a return of 0% - or a return of 25% if you won the minimum prize on a £100 investment.
For it to average out to 3.8% across all savers, many bonds have to win nothing to pay for every £25 prize.
When you factor in the larger prizes - including two of £1 million each month - most bonds will have to win nothing to keep the prize rate down at 3.8%.
For example, last month, the NS&I handed out 5.9 million prizes to Bond holders. This means 131.39 billion bonds - or 99.995% of them - won absolutely nothing.
Around 5% of Premium Bond holders - so around 123million - hold the maximum amount of £50,000. As they hold the most, they have the greatest chance of bagging a prize, and collectively they hold 49.7% of all the money in the draw.
In the past five years, 94% of Premium Bond jackpot winners held over £10,000, while three quarters held over £25,000. Both savers who won the £1million jackpot in this month's draw held the maximum £50,000.
For those who do eventually win, the prize amount is often modest. In 2024, 88% of Premium Bond prize winners took home less than £2,000 and just 0.32% of all winners won more than £10,000.
Octopus Money says that over £4.25billion has been held in Premium Bond accounts that have had no activity in the past decade - earning zero interest which has eroded the individual wealth of the Bond holder. =
Ruth Handcock, CEO of Octopus Money commented: 'While products like Premium Bonds may work well for some, others are missing out on strategies that could grow their wealth and deliver stronger returns over time. Premium Bonds are unlikely to outpace inflation, so your money may seem 'safe' but it's quietly shrinking in value over time.
"The truth is that millions of people could be getting more from their money, but they need access to affordable, personalised advice to help them figure out what's right for them - something that only 9% of people in the UK currently receive.
"Without it, they stick with what feels familiar or they're left in financial limbo, unsure how to take that first step."
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
The Courier
a day ago
- The Courier
Forfar Gables vandalism bill revealed as affordable housing plans resurface
The cost of combating vandals at The Gables in Forfar has been revealed as it emerged multi-million pound affordable housing plans for the site are back on track. In 2024, Angus Council closed the Arbroath Road centre for adults with learning disabilities. It had operated for around 40 years. Eight residents left The Gables on March 27 last year after the service was moved to the former Beech Hill residential home in Lour Road, Forfar. Security measures alone since the home closed have cost more than £15,000. Angus councillors had previously agreed to transfer the Gables site to Caledonia Housing Association. The Tayside-based landlord drew up proposals for a development of around 20 affordable homes. But the deal was never finalised after CHA dropped the scheme due to spiralling costs. The Courier can now confirm the project is back on the cards after policy committee councillors approved the land transfer to CHA for the second time. A report recommending the site transfer was agreed in private on Tuesday. And we can also reveal the cost of tackling vandalism there since the doors were closed. Shocking images from inside The Gables showed the state of the building following a deliberate fire there in February. Angus Council has spent £15,491 on security measures and repairs at the site since it closed. The figure was part of a Freedom of Information response around expenditure at The Gables since 2019. Between the council and Angus Health and Social Care Partnership, the planned and unplanned maintenance figure exceeded £135,000. Totals for the council's planned and unplanned maintenance over the period are: The 2024/25 figure largely comprises the vandalism costs. AHSCP's total outlay was £51,166 over the period. The council said there had been 'six or seven entries or attempted entry and various degrees of vandalism' to the property. Only one required the attendance of Police Scotland and the Scottish Fire and Rescue Service, according to the authority. A spokesperson for Caledonia Housing Association said: 'We welcome Angus Council's decision to approve the transfer of The Gables site. 'The legal process has yet to begin and no date for the transfer has been set. 'Any future development will require a fresh planning application, which will be informed by local housing needs and developed in partnership with Angus Council. 'Caledonia will not assume responsibility for securing and maintaining the site until the legal process is complete.'
Reuters
a day ago
- Reuters
India coal-fired power output falls at fastest pace in five years in May
SINGAPORE, June 5 (Reuters) - India's coal-fired electricity generation in May fell at the fastest pace in five years, as overall power demand declined for the first time since August and renewable energy generation rose to a record high, a Reuters analysis of government data showed. Increased generation from less polluting power sources including hydro and nuclear also led to a decline in natural gas-fired power output, which fell at the steepest rate in nearly three years, a review of data from the federal power grid regulator Grid India showed. The decline in demand for fossil fuels for electricity generation in India - the second largest importer of coal and the fourth biggest buyer of liquefied natural gas (LNG) - comes at a time when benchmark prices of the fuels are under pressure. "Demand from the power sector - typically strong during peak season - remained limited. Additionally, economic headwinds have weighed on non-power industries," Indian coal trader I-Energy said in a note this week. Asian spot LNG prices have declined more than 15% this year, while benchmark prices of thermal coal have plunged to more than 4-year lows due to weak demand from China and India - the top coal importing countries. India's coal-fired power generation fell 9.5% in May on an annual basis to 113.3 billion kilowatt-hours (kWh), a review of data from the federal power grid regulator Grid India showed, marking the sharpest year-on-year decline since June 2020, when the COVID-19 pandemic led to a nationwide lockdown. A sustained slowdown in demand for fossil fuels for power generation could help the world's third largest emitter of greenhouse gases slash emissions after it previously boosted its reliance on coal to power a post-pandemic economic recovery. India has repeatedly cited lower per capita emissions compared with richer nations to defend its high coal use. Utilities in China and India have cut dependence on coal and LNG imports this year also due to record coal stocks and slower growth in power demand. India had forced gas-based power plants to operate last year to meet high power demand as temperatures soared. As power demand is lower and prices are high for gas-fired power to be competitive with other sources such as solar this year, utilities will buy fewer volumes, said Prashant Vashisth, vice president at Moody's affiliate ICRA. Total electricity generation in May fell 5.3% year-on-year to 160.4 billion kWh, the data showed, with the highest peak demand about 8% lower on-year at 231 GW, mainly due to milder temperatures, government officials said. Peak demand - a measure of the maximum electricity requirement over any given time - reached 250 GW during a heatwave in May 2024. Meanwhile, renewable energy output surged to a record high of 24.7 billion kWh in May, up 17.2% from a year earlier, with its share in the overall power mix rising to 15.4% - the highest since records began in 2018. The share of coal in India's power mix dropped to 70.7% in May, down from 74.0% a year earlier and the lowest level since June 2022, according to the Grid India data. Hydropower generation jumped 8.3% to 14.5 billion kWh, accounting for 9.0% of total generation compared to 7.9% in May 2024, the data showed. Natural gas-fired power generation fell 46.5% annually to 2.78 billion kWh in May, the steepest decline since October 2022.
Daily Mail
a day ago
- Daily Mail
Why did NS&I name the precise town where the most recent £1m Premium Bonds jackpot winner came from?
In the most recent Premium Bonds draw, I noticed that one of the £1million jackpot winners was from Stockport, Greater Manchester. However, I was under the impressions that usually it's the county that is named, not the exact location. Looking through the list I see Hertfordshire, Devon, Kent, Wales... but not specific large towns or cities in these areas. Why is it that Stockport is named - alongside other more specific locations like Barnet, Croydon, Norwich and Fife to name a few? Helen Kirrane, This is Money's savings reporter, replies: June's Premium Bonds £1million prize winners hailed from Stockport and Edinburgh in this month's NS&I draw. The Stockport winner was only the second ever £1million prize winner to come from the town, while the Edinburgh winner was the first £1million jackpot winner from the Scottish capital in eight years. But why was Stockport reported as the location of one of the £1million winners but the other £1million prize winner's location was reported as the city of Edinburgh which is a local authority? Other high value prize winners this month were reported as coming from even broader areas like West Midlands, as in the case of a £100,000 prize winner who won with a holding of £2,000. The answer comes down to the way NS&I reports the location of prize winners. NS&I sets rules when announcing the location of prize winners to protect identities. Each customer is assigned to a town, local authority, county or government standard region and country. When a winner is assigned to a town with less than 100,000 account holders, NS&I use the hierarchy below until it finds a level where that area has at least 100,000 Premium Bonds holders. These are: Level 1 Royal Mail Postcode Address File (PAF) Town (like Blackpool); Level 2 County or Local Authority (like Lancashire); Level 3 Government Standard Region (like North West); Level 4 Country (like Wales). Stockport falls into the bracket of place with more than 100,000 Premium Bond holders - the borough population is just shy of 300,000, which suggests at least one in three Stopfordians hold the popular products. The local authority of Stockport had 105,484 Premium Bonds holders in the June 2025 draw, according to NS&I so it was able to report the precise area the winner was from. A spokesman from NS&I says: 'Each month NS&I publishes a full list of prizes won including the winning bond number, size of holding and the location of the Bond holder. 'However, to protect the identity of individual Premium Bonds's holders we identify the location based on at least 100,000 bond holders living in the area. This could be the town or city, county or local authority, government Standard region or country.' With this month's £1million winners, there are at least 100,000 Premium Bonds holders living in Stockport. Whereas the winner from Edinburgh will come from an area with fewer than 100,000 holders and so the county or local authority area is used. Different rules for reporting Premium Bonds winners from overseas apply. For Premium Bonds holders living outside the UK, NS&I only publishes the country when there are at least 100,000 holders living there. Otherwise, they publish the area as 'overseas'. For this reason, you will never see a Premium Bond's winner listed as being from the The Isle of Man or the Channel Islands, as they fall into this bracket. Guernsey has just over 19,000 Premium Bonds holders and Jersey just over 29,000 – taken together, this is far less than 100,000 Premium Bonds holders, so NS&I would not report this as Channel Islands. The default for reporting a winner from one of these areas would be 'overseas'.
