Latest news with #Dodl
Daily Mirror
29-04-2025
- Business
- Daily Mirror
Premium Bonds warning issued as millions of savers told to take their money out
A Freedom of Information (FOI) request obtained by AJ Bell's Dodl investing app revealed that nearly two-thirds of Premium Bond holders - which is equivalent to just under 14.4 million people - have never won a prize A warning has been issued to Brits who have Premium Bonds, as the majority of bondholders will never win a single prize. A Freedom of Information (FOI) request obtained by AJ Bell's Dodl investing app revealed that nearly two-thirds of Premium Bond holders - which is equivalent to just under 14.4 million people - have never won a prize. 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. You get a unique bond number for every £1 invested, and you can invest from £25 up to £50,000 in total in Premium Bonds. The more Premium Bonds you buy, the more unique numbers you have entered into the draw. Around 22.7million people hold a bond, which makes them one of the UK's most popular savings products. Overall, around £127.7billion sat in Premium Bonds accounts at the end of 2024. NS&I quote a current variable prize fund rate of 3.8%, but there is no guarantee of any return on your cash. The data revealed that millions more £50 and £100 prizes have been dished out since 2022, and they now make up a larger proportion of winning prizes than the lowest £25 prize. Although the number of higher-value prizes has also jumped, most Premium Bond prizes were worth £100 or less in 2024 - meaning the chance of winning the top prizes is still very small. Between March 2024, and February 2025, there were 5.1million winners - 80% of those winners won more than once over those 12 months. However, the average holding for those prize winners during this period was £23,397, which AJ Bell notes is far higher than the average £5,406 holding across all customers. Join Money Saving Club's specialist topics Charlene Young, senior pensions and savings expert at AJ Bell, said that Premium Bonds have "long been a popular place" for savers to stick their cash and try their luck at winning a prize in the monthly draws. They said: "The chance of winning any of the top prizes, from £5,000 all the way up to £1 million, remains minuscule. The market is still flush with cash accounts including tax-free ISAs paying rates higher than the Premium Bond estimated prize fund rate of 3.8%, meaning holders might benefit from shopping around to make their cash work harder. 'There's a chance even the average holding won't win a prize, meaning savers might be better off considering other options with their cash rather than leaving it to chance in a Premium Bonds account, particularly over the long term."
The Independent
28-04-2025
- Business
- The Independent
Premium Bonds may be incredibly popular – but 14m have never won a penny in prize money
Only a third of people who hold Premium Bonds have ever won a single prize, out of the 22 million people who entrust their savings or spare money to the scheme run by by NS&I. Recent data shows more than 14m of holders, or 63 per cent, have never won, despite there being regular handouts of £50 and £100, with the possibility of also winning £1m. Many people use Premium Bonds effectively as a savings account, as tax is not payable on winnings and the prizes on offer can give returns better than interest rates in traditional savings accounts. NS&I quote a prize fund rate of 3.8 per cent - however, there is no guarantee of winning and cash left in them does not earn interest in the traditional sense, meaning its value will lower over time due to inflation. A freedom of information (FOI) request, from the investor app Dodl, shows that while the total number of prizes handed out worth more than the lowest amount of £25 has 'increased significantly since 2022', data suggests those with bigger holdings are increasingly benefitting from the bigger prizes. In total, more than £127m is held in Premium Bonds, where rules state £50,000 is the maximum any one account may hold. They say the odds of winning are one in 22,000 for each £1 a holder has in the monthly draw and note 'the more Bonds you buy, the more chances you'll have to win.' But the AJ Bell-owned app further revealed what while the average overall holding was around £5,400, the average holding for the 5.1m accounts who won a prize over the past 12 months was well over £23,000 - and 80 per cent of those winners won more than once across the year. 'While there has been a recent shift to most winners receiving prizes of £50 or £100, instead of the lowest £25 on offer, the vast majority of winning prizes in 2024 were still worth £100 or less,' said Charlene Young, senior pensions and savings expert at AJ Bell. 'The chance of winning any of the top prizes from £5,000 to £1m remains miniscule. The market is still flush with cash accounts, including tax-free ISAs, paying rates higher than the Premium Bond estimated prize fund rate - so there is a huge amount of money making no return whatsoever when savers could otherwise be raking in more than 4.5 per cent. 'Of course the lure of Premium Bonds is that you might win the big, £1m prize, but these figures show that it's very unlikely, especially if you have a small amount saved in the bonds.'
