WHY YOU SHOULDN'T BE TEMPTED TO CASH IN YOUR PREMIUM BONDS AND BUY NEW ONES IF THEY FEEL 'UNLUCKY'

It can feel sometimes that there is an element of beginners' luck when it comes to Premium Bonds.

Savers can get caught on whether their bonds are too old and unlucky to win a prize or whether they have enough saved in Premium Bonds to win a big prize.

There can be a temptation to cash in the bonds if they were bought a long time ago, are not winning any prizes and just feel a bit 'unlucky'. 

Some Premium Bonds winners debunk all these beliefs though. The oldest bond to ever scoop the £1million jackpot was bought in 1959 — and was picked out as a winner by ERNIE 45 years later in 2004. 

The winner, from Newham in London, had a holding of just £17.

Every month, Premium Bonds holders are entered into a prize draw. Every £1 you invest into Premium Bonds buys you a unique Bond number with an equal chance of winning a monthly prize of between £25 and £1million. 

This month, some NS&I customers have been receiving a notification in NS&I's prize checker app when checking if they won a prize.  

In bold capital letters it reads: 'YOUR BONDS WON'T BE FORGOTTEN. Don't be tempted to cash in your Bonds if you think they're not bringing you fresh luck.

'Doing this will mean you will miss a prize draw — which means fewer chances to win a prize.'

Could NS&I worried that holders may cash in their bonds at a time when it is tasked by HM Treasury to pull in £9 billion (plus or minus £4 billion either side) in its financial year which started on April 1?

According to figures published so far, in the first two months it saw only £58million flow into its coffers. Last year it took in £2.4billion in that period.

Savings experts say the main thing is not how long you have held the bond for, but the amount of bonds you hold.

The maximum holding for Premium Bonds is £50,000 and each bond number is worth £1.

This is Money recently analysed data from the past 50 Premium Bond draws and the 100 millionaires created over that time, stretching back to May 2020.

The average holding of a £1 million winner was £38,779. This compares to the average Premium Bond holding of £5,250.

Just 38 of the 100 newly made millionaires held the maximum £50,000 in Premium Bonds. 

As the tax-take on savers rises, the fact savers pay no tax on any prizes is a big appeal.

HRMC said it expects to rake in £10.37billion in savings tax interest in the current tax year. 

While there is no guarantee that you will win any Premium Bonds prize in a given month, anything you do win is completely tax free. 

Premium Bonds don't earn interest. Instead, there's an annual prize fund rate that funds a monthly prize draw for tax-free prizes. This currently stands at 4.4 per cent. 

2024-07-10T08:37:22Z dg43tfdfdgfd