I'd like to feel happier for some of the regular winners, but as I've won zip all since investing six months ago I'm finding it hard to feel the love.

I'll be cashing them in shortly, a bad investment for this punter.

Well, so are the premium bonds a waste of time if becoming a millionaire is your objective.

The point of my post was to suggest that there might be cheaper ways of recreating the same risk/reward offered by premium bonds.

Perhaps if I get some time I'll get my calculator out see if I can prove it.

I don't think you could, remember that PB's are re-entered into each draw and you can always draw down your principle, the lottery is all or bust.

I bought £6,000 worth in Jan 2006 and not won anything lol, so have effectively lost about £250 in no interest

Sorry to read that. I empathise, had 2 consecutive months with sweet f a when I held bonds for 6 months or so about 5 or 6 years back with the max holding. In the end, it's the old luck thing. If it's in it's in. I know many people who play the lottery, 5 or 6 lines a week, seldom even win the tenner. I know a woman whose family are millionaires, she gets 4 numbers fairly regularly (like once every 1 or 2 months, something like that) on just one line a week. I only have her word for that but I doubt she's lying.

I had p/ bonds years ago, did not win as much as I could've got in savings interest (I had the max in) and some months no win at all, I recall two consecutive months out of 7 or 8 with no win.

I don't particularly like these, but of course some people do win. My own 'luck' when I had them was as consistent as ever - lousy wins and below average 'luck'. Would I have won big if I'd kept them all this time, well somehow erm I doubt it...

Anyway a relative has bought the max recently and is excited about them despite not winning a bean this month and only £100 last month on the max of £30K in. I'll be charting her progress here if anyone wants to know. So far:-

Month 1 £100
Month 2 no win

Watch this space.

According to the NS&I website, the chance of an individual bond winning each month is 24,000 to 1. Therefore, on average, with a maximum investment of 30,000 bonds, one would expect five wins every four months. The most common win would be £50.

For the sake of example, if someone won £50 four times and £100 once in those four months, that would equate to:

£250 / £30,000 = 8.333% over four months, or 2.5% AER.

The remaining 1.3% (out of the 3.8% interest that NS&I say PBs attract) is necessary to pay all those larger prize winners...

Thanks OJ, I think NS say 15 wins over 12 months is the average, but I've heard of plenty of people who suggest they had less than that on the £30K max holding. And, of course, there's the same anecdotal testimonies from the lucky few who do better than the average. I tend to think if your luck's in it's in, if it ain't it ain't, probability and law of averages aside. I'll be posting results here if anyone's interested. I'll also add that my uncle had PBs from donkey's years ago, couple of hundred worth, I think he only won once in 20 or 30 years and it wasn't anything spectacular. However, to those that win or who 'feel lucky' all this is to be disregarded of course!

Oops! That should've been 0.8333% of course, not 8.333%! The 2.5% AER was correct, though!

Yep, I can concur here. I've got about 9k now saved over a year and a half and it's been a complete waste of time thus far. No winnings whatsoever. BUT! I am the kind of stubborn fool who will stay until I've won at least 1 prize. Meanwhile I do calculations to see what I could have made with the money in a fund/bank account and pull my hair out. Such is the nature of investment, I suppose.

At least, unlike investing in houses, you cannot lose any of your original investment! ;)

Cash them in add 1K and re-invest in a 10k block. Insist with NSI that you want a 10k block. ;)

with current money supply/inflation it's losing around 10%+ of it's value every year...

Are you sure you've not won anything in 1.5 yrs? Very disheartening tale, sorry to hear that. Check with the online checker thing (not sure if it goes back more than 6 draws) and make a proper enquiry with them to be sure no cheques have gone astray.

I got 50£ this morning, buts its been months since I got anything on my 10k getting bored with this.

Statistics has nothing to say about the individual.

As the sample size increases (the number of people sampled, or the number of months you stick with PBs), there'll be a tendency for the returns to converge on 3.8% (or whatever the current PB rate happens to be).

A handful of people looking back over a handful of months is interesting anecdotally, but isn't very statistically significant.

PBs are about forfeiting a better interest rate to have the chance to win a larger prize. I guess if you want to be in with the chance of a big win, PBs might be your sort of thing. If you'd prefer a guaranteed, regular and (on average) higher rate of interest with no chance of pleasant surprises, choose something else! Simple.

However, having said that... comparing PB's 3.8% with other interest rates can be a bit misleading. Quite a chunk of that (average of) 3.8% goes into funding large prizes that, in an ordinary lifetime, you have almost no chance of winning. So, for most people the money they'll actually receive in prizes will be lower than 3.8% (although, of course, for some people, the interest rate will be much, MUCH higher!)

I hope this helps in making an investment decision you're happy with!

50 July

50 July

50 April

50 March

50 March

100 January

50 January

20k of bonds would have been a bit more in high interest account but not as much fun

This is from MSE and may help:

http://www.moneysavingexpert.com/savings/p...nds-calculator/

I got this in an email from MSE. Martin Lewis is a diamond geezer for anyone who likes to look after their cash.

I've got 20k of PB's and I'm going to can them next month or drop to a nominal amount as they're not really cutting it. Returns of £100 in 3 draws versus lost interest of circa £300. Fun but not fun enough!

The MSE PB calculator is brilliant and illustrates well the mediocre performance most people experience with PB's.

Premium Bond interest rate up to 4% from 1st August 2007: Link.

The wife and I have held the max since 1994 and I must say we are well pleased with the returns over that period.

Month 3 £150

With savings accounts rates rising to 6% or more gross in some places, will she keep her PBs and hope for a big win? The suspense is breathtaking!

(actually, will only post further results if someone here actually says they want me to, don't want to spam the board)

The Name's Bond
Money Saving Expert website owner and journo, Martyn L will I think be on UK BBC Radio 2's Jeremy Vine programme either 8 or 9 Aug. Listen at start of the show for confirmation, he'll be talking about Premium Bondage I mean Premium Bonds. Maybe available for audio ("podcast") download after there.

Jeremy Vine show on UK BBC Radio 2 FM (or on the webcast) - premium bonds discussion with Martyn L is tomorrow, FRIDAY 10th AUG.

Gist of what was said on the show
---------------------------------------
Martyn L has spent last 3 months investigating probability of premium bonds.
On £1,000 invested for 1 year, 57% of investors will win nothing.
On £30,000 invested for 1 year, only 1 in 5 chance of beating inflation.
A caller had won £1,000 or just over on their £30K invested in 10 months ("over-average luck"). Same caller has previously won £500 in one go.
The "sense of excitement" element was discussed briefly.
Caller who had well below average luck decided to cash in and put in a savings account, Martyn recommended NS&I ISA.
I think Martyn L was somewhat in favour of premium bonds for higher rate taxpayers only.
Martyn spoke about the Irish Lottery briefly, I think he was talking of using interest to buy an Irish lottery ticket but not sure I heard right as am working as I listen and trying to write this at the same time!
Martyn said he wins a pound every week on the UK National Lottery/Lotto...by not playing.
Senior premium bonds spokesman there, doesn't argue with Martyn's maths, fully agrees with Martyn that first product to invest in should be a Cash ISA, premium bonds are (he implied) part of a portfolio of investments only and is "a bit of fun" when seen in perspective in a wide portfolio of investments.
Need £1750 invested to win one prize over a year with "average luck", which would probably be £50 only.
Jeremy's cousin won £25,000 this year.
Same person has never won the jackpot twice.
jeremy asked why premium bonds winners don't seek publicity unlike Lotto winners.
Jeremy thought people could put a million in - oops, max is £30,000! Premium bonds spokesperson corrected him!
Caller called Carol then phoned in and said she'd won the £million on £10,250 invested in 1999. (She moved house after a couple of years, had some fabulous holidays and fabulous cars). Martyn ended by saying "The problem is for every Carol out there, there's a lot of people not winning..."

Go to Radio 2 website and Listen Again for Friday 10 Aug to hear it all for yourself, from 60 mins in to the show.

Hi Charlie.

Why is it a good idea to have 10k blocks? If the selection process is completely random each bond is as likely to be chosen as any other. I don't see how having adjacently numbered bonds will increase the odds of any of them being chosen. Am I missing something?

Thanks.

Edit: acn't splel.

Without reading the whole thread. I ve Just sold the lot leaving £200 as a token jesture. [probably the most i would spend on lottery tickets anyway in ten years].

I fear inflation would erode these away. £20K pre year 2000 could have bought half a decent flat, now in 2007, you could get a garage!

Charlie, if you buy £10,000 of premium bonds and check the serial numbers you'll see they almost always sell them in consecutive blocks anyway, ie 2 lots of 5000 bonds but consecutively numbered, effectively a 10K block in all but name.

In my experience that has not made any positive difference.

I had bonds myself - very poor wins.

Someone I know has them - ditto.

All consecutive blocks - me was 4 lots of consecutive 5K blocks, she with 6 (max holding) consecutive 5K blocks.

No difference. Still a poor rate of wins.

If your luck's out it's out.

But well done Charlie, I hope your winning streak continues.

Ive got 60K in mine & my wife's name. A high rate interest account comes with high-rate tax for us, so we figured it's worth a punt for a couple of years.
But I agree that long term they're not great as inflation eats away at the original deposit. Unless you win big, of course...
The NS&I bonds are a better deal, I think. Interest is RPI plus 1.35%, TAX FREE.

I purchased one 10k block back in 2003 after they increased the maximum holding.

We x2 have averaged £2k winnings annually since and 60% of my winnings have been from that block.

To me PBs are like a large roulette wheel, as the ball spins around I have 10,000 continuous holes to catch the ball.

If you are tight a***d, going for the extra .5% interest on you cash, then please leave PBs alone, so the Pro s can play the system.

I have the full amount - have had for two years and have never won more than £50

just read through this thread. Are the rates of the return similar to what they were a year ago? If yes they look tempting compared to my crappy ISA rates.