Premium Bonds

Just a quick post before the weekend after a blur of a week.

Recently, M from There’s Value mentioned in a comment that she had no idea why people buy premium bonds and why not just stick the money in my ISA?


I replied that premium bonds were my equivalent of sticking cash under my mattress, readily available, (and getting eroded by inflation, I know…) but with a chance of ‘winning’ something.

Anyway, this morning I got this email (slightly adjusted for blog purposes):

Woohoo! First time I’ve won in years!

Ok, so I only won £50 which represents a 3.1% gain on my ‘investment’.

Hardly worth the bother perhaps, considering I got 0% the past few years.

MoneySavingExpert has done a good piece on the pros and cons of premium bonds here. The cons appear to outweigh the pros but the main thing is to be aware that premium bonds are more for ‘fun’ than ‘returns’ and yes, I’m aware!

The £50 will now be chucked into the pot to be invested ‘properly’.

Have a good weekend all!

14 thoughts on “Premium Bonds

  1. Hi Weenie,

    Congrat's on the £50 win! I have to confess that I'm on M's side with this one. I have no intention on doing premium bonds personally.
    I'm all about chasing the high returns from investments! That's my idea of fun!

    With that said Weenie, I respect the fact that you openly admit to it not being the best ROI, but you do it anyway because you enjoy being in the process. There's nothing wrong with that!

    I'm enjoying drinking my glass of red wine tonight whilst I write. It's costs me money and I'll feel like crap tomorrow, but I embrace the pain! 🙂


  2. Hi Huw
    Thanks and yes, it's just a bit of fun. As with my foray into P2P, there's only so much money I will pump into premium bonds, it's just to do something different with the cash part of my savings.

    I hear you on the wine – not drinking tonight as got a big session tomorrow. Even taken Monday off so I can have an extra day to recover (I have holidays carried over that I need to use up!) Cheers! 🙂

  3. Great news on your win.

    I'm afraid I've got an even dirtier secret than Premium Bonds and that's the occasional scratch card. I tend to treat them as a form of entertainment, have them on high days and holidays and put them in with birthday cards and so on. I've no doubt that I'm down money-wise but they do at least have a 1 in 3.8 chance of being a winner which is far better odds than the lottery itself (I won £20 on one at the weekend).

    Some people claim that you can "count" the Bingo type cards by ranking the visible numbers on the grids and so increase your odds of winning and there's a whole YouTube culture around videoing yourself scratching cards. Fascinating.

    Hope you have a good weekend too 🙂

  4. Congrats on the win.

    I won in Dec, only £25 though. As you say its not the best place for cash but its money used for a bit of fun and guaranteed to be refunded when I need it – even if it hasnt earn much in the way of interest in the mean time. But then…my cash savings don't earn too much either!

  5. Thanks Cerridwen. I'm not a scratch card person myself but on occasion, I do buy them to put in Christmas or birthday cards (usually with a note saying 'remember me if you win' hehe!) I still play the lotto but at £2 a week, well that's like buying one Costa Coffee a week and I'm sure I won't get a chance of winning anything by drinking coffee! 🙂

    Interesting stuff about the Bingo type cards though!

  6. Thanks sparklebee and congrats on your win in Dec. Yes, I do treat it as 'fun', it's not a huge amount but is there when you need it. Thanks for stopping by.

  7. I'm a gambler at heart so understand where you're coming from with this one. Saying that I don't much like games of pure chance, I like to know (or at least think) I have an edge! Still trying to persuade Mrs TFS to give up the lottery but she has "her numbers" now so is seemingly locked in.

    Anyway, The Opp cost of putting your savings into a cash account are minimal so I say enjoy it and good luck. Oh and remember me if you win big 😉

  8. Hi TFS, yeah, it's the 'gambling' that draws me but like you, I prefer gambling when there's an 'element of skill'. Just that with premium bonds, you don't lose your initial stake, only a bit to inflation if you don't win! I totally understand Mrs TFS – I don't think I'll ever give up playing the lottery, I've been playing most of my life now, it's just a hobby! Thanks for the good luck wishes and good luck to you and Mrs TFS!

  9. OMG, congratulations! Also, thanks for the mention. I don't have a problem with the fun element, but as MSE points out, it's not really 'worth' it from a savings/investment perspective. I'd rather buy the occasional lottery ticket, which I do very rarely sometimes, just for fun. I won about £30 the year before last, which I feel is way above average luck, considering the AWFUL odds of winning anything. I also very very occasionally buy scratch cards for birthdays, but only if I 'feel' I should, which almost never happens. But when it does, the other person is always a winner! Now, if only I could 'feel' the winning numbers for euromillions…


    P.S. I've selected which homebrew you're getting when we do the bloggers meet-up 🙂

  10. Haha, thanks! It was such a coincidence after you'd mentioned it that I got the win, so please, mention it some more! 🙂

    I've put a bottle of my homebrew aside for you (otherwise I'd end up drinking it!), not sure if my current batch will be ready by the meet-up but we'll see!

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