Today on trader-uk i see what happened when I spent £50,000 on premium bonds. Are premium bonds worth it? How do premium bonds work? I’ll explain how good the returns are on ns&i’s most popular investment product. I also look at if this is a good investment for beginner traders and how safe the investment is.
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How much I earn with £50,000 of premium bonds
Premium bonds have long been a popular investment option for millions of people in the UK, offering a unique blend of chance and opportunity for potential earnings. For those unfamiliar with premium bonds, they are a form of government-backed savings scheme, where instead of accruing interest, bondholders have the chance to win tax-free cash prizes every month. This tantalizing prospect has made premium bonds a favored choice for many savers and investors, and today we explore how much one can potentially earn with £50,000 invested in these bonds.
First and foremost, it is important to note that the returns on premium bonds are not guaranteed, making them different from traditional savings accounts or investments. Instead, the interest is calculated in a monthly prize draw, where winners can receive cash prizes ranging from £25 to a staggering £1 million. This randomized system has both its advantages and disadvantages, as it means you could potentially win nothing, or you could win big.
On average, premium bonds have a prize fund interest rate that currently stands at 1%, meaning that the total winnings are approximately equal to 1% of the total value of all the bonds held. In this case, with £50,000 invested, one could expect an annual return of approximately £500, assuming no major windfall.
It is worth mentioning that the prize fund rates are subject to change, and have been lower in the recent past due to economic fluctuations. However, the chance to clinch the £1 million jackpot prize, while slim, is what keeps many bondholders optimistic and invested.
Furthermore, it is important to consider the concept of luck when dealing with premium bonds. As the prizes are awarded randomly, some individuals are fortunate enough to win multiple times, while others may go years without any notable wins. This key aspect of randomness means that the returns on premium bonds can be quite sporadic, making it difficult to predict how much one can earn, and highlighting the importance of patience and long-term investment.
Another aspect to consider is that premium bonds can be cashed in at any time, allowing bondholders to withdraw their funds if necessary. However, it is important to remember that the longer the bonds are held, the higher the likelihood of winning a prize. Withdrawing the funds too early may result in missing out on potential winnings.
Despite the relatively low average return rate, premium bonds continue to be a popular choice, particularly for those who seek a safe and exciting investment opportunity. The appeal of the potential to win big and the guarantee of never losing any initial capital is a strong draw for many individuals.
In conclusion, while premium bonds may not offer substantial guaranteed returns, they provide a unique investment experience that combines security and chance. With £50,000 invested, one can expect an annual return of around £500 on average. However, the element of luck ensures that the actual earnings are unpredictable, and there is always the potential to strike it rich with a significant win. Ultimately, premium bonds are a particularly appealing option for those who enjoy a bit of excitement in their investments and are willing to take a chance on the possibility of winning a substantial cash prize.
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Thanks for your support
Adam
I got to start over financially at age 43, I'm in 90% stocks now and 10% exchange-traded REITs. Honestly, I'm fine with it. At retirement I plan to switch over to all dividend stocks and just live off the income, not caring a whit about what the day-to-day prices in the market are.
I held £50,000 in premium bonds as well, i only earned about £1300 over 2 years, which isn't as good as i hoped, so i decided to take most of that out & invest in other opportunities!
Prize rate is so good currently. I won £500 in February's draw!
I won £10000 in may
My opinion I think the £25 prices are pick out and not by the draw, ( swèetners )
Premium Bonds are a waste of time unless you have spare cash around. If you really want to makes your money grow just buy the S&P 500 index fund
Shame about the annoying background noise, which distracted from your excellent, informative narrative – for which I thank you.
Premium bonds are poop, the rates now 1%, still the rest of the savings accounts are even bigger poop, if you really were a clever boy you would have bought any one of the tech stocks such as Google and more than doubled your 50k to 100k!
I must be one of the luckier ones, I won £1000 and £25 in the first month wating for Aprils draw now!
A definite yes for me. The best alternative to lottery tickets.
Can't find out if you can have them in Thailand expat in Thailand
I very much doubt if the premium bond interest rate is as high as is published. Despite having the maximum amount invested, I have won nothing in six months. The probability of this happening is something like 0.0001. I am sure investors are being screwed without their knowledge (to pay for furloughing etc).
This is a fantastic video- thank you! What are your thoughts on still having premium bonds now given the prize rate has dropped drastically since you made this video?
1.4% ? Ok boomer
Million Dollar Potential in Ruvol
I have invented a Board Game [still unpublished and not yet out in the market] that is guaranteed to be far more challenging and exciting than CHESS. I called it “RUVOL.”
Over time, Ruvol will surpass chess as the “Number One Board Game in the World.”
Why am I so sure about this? Because I am an avid chess player myself. The weakness of chess is it always starts in fixed positions that the opening moves become “memorizable.” In fact, not a few have so mastered the moves that they can play against their opponents “blindfolded.” It’s for this reason I invented Ruvol where every game is always challenging and exciting to play.
HOW IS RUVOL PLAYED?
Ruvol is played somewhat like chess. I purposely invented Ruvol to give chess a direct “apple-to-apple” competition.
Like chess, Ruvol is played by two players. It uses a board that is rectangular in shape but containing more number of squares than chess. Like chess, it has equal number of pieces on each side of the board, where each type of piece moves in distinct ways. However, if the way to win chess is to checkmate the opponent’s king, the way to win Ruvol is to be able to cross a designated line.
But there’s one biggest advantage Ruvol has over chess that makes Ruvol a very challenging game to play. Unlike chess, the Ruvol pieces are randomly placed at the start of every game which makes it impossible for any clever player to memorize the moves. Fischer Random Chess, also known as Chess960, likewise introduced a random set up, but with many exceptions. Ruvol is 100% random.
At present, there is no other board game in the world within the same category of chess “where chess players can switch to.” Chess is totally a monopoly in its class. Chess players can now have an alternative in Ruvol.
A MILLION DOLLAR POTENTIAL IN RUVOL
In my Google search, I learned there are around 800 million chess players in the world. These 800 million players comprise the “Total Potential Buyers” of Ruvol across the globe. At an average profit of just US$3 per set, the “Global Income Potential” of Ruvol then is US$2.4 billion. Assuming only 1% of it will buy each year, the annual global potential sale of Ruvol is US$24M.
I AM SELLING MY COPYRIGHT TO RUVOL.
For the reason that I don’t have the resources to publish Ruvol on a global scale, I find it “wiser” to simply sell my copyright.
If you’re interested to buy my copyright, email me your BEST PRICE OFFER. My email address is: rodolfovitangcol@gmail.com.
Thanks and God bless!
RODOLFO MARTIN VITANGCOL
The Ruvol Inventor
Early bird catches the worm!
put that in bitcoin and you will do them profits daily
b l u e p r e m i u m b o n d
Hi, thank you for this video, i'm about to transfer my savings over to Ns&I now. I'm just a bit confused about the buying bonds part. If i transfer say £1500 from my savings account to the NS&I premium bonds account…. does that automatically buy me bonds? or do i actually have to do something? also if i transfer an amount monthly does that also buy me bonds. Thank you
what is another good way to save?
It's ''fixed'' to be in the 50k bracket.!!
Definitely looking into this, thank you for the insight.