Are Premium Bonds worth holding onto - and will rates rise?

This is Money Podcast

This is Money

Business News, Business, Investing, News

4.1 • 650 Ratings

🗓️ 18 October 2021

⏱️ 49 minutes

🔗️ Recording | iTunes | RSS

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Summary

Premium Bonds are probably Britain’s best loving savings product but are they worth holding?

The savings lottery delivers 100% government-backed protection, a theoretical 1% return – dependent on luck – and relatively easy access to your cash.

But a new report this week highlighted just how unlikely people are to win big prizes. In fact, unless you have a sizeable amount in bonds, you should expect a long wait for anything over £25.

But does the study stack up? What about all the readers telling us they’ve won lots? And does it matter that you’d have to wait ages to win £50 or more – or are those uninspiring regular £25 prizes a much more useful source of returns?

On this week’s podcast Georgie Frost, Adrian Lowery and Simon Lambert dig into Premium Bonds, looking at the odds, the study on big prizes, what our readers have told us, and also how many people hold.

Plus, interest rate rise chatter has stepped up a gear this week. Is a hike really imminent?

Also under discussion are the energy saving measures you can take to try to cut your bills as the price spike sends more providers bust and threatens household finances.

As Meghan and Harry get the ethical invest bug, we a look at ESG, greenwashing and how to invest to make an environmental impact.

And finally, the topsy-turvy Covid world has thrown a new curveball: one-year-old used cars are now more expensive than brand new ones. How does that work? The team try to explain and reveal the used cars rising in value the most.

Transcript

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0:00.0	Welcome to This Is Money Podcast. I'm Georgie Frost. Stand alongside me and editor Simon Lambert today is Deputy Editor Adrian Lowry.
0:07.6	And coming up, Simon explores the art of patience with premium bonds.
0:12.7	You may need to be patient to save for a comfortable retirement with costs on the rise, talking of which energy bills.
0:18.5	We take a look at the small changes that can result in big savings,
0:22.0	and we'll be exploring how you can avoid the greenwashing trap and invest in firms really trying to save the planet.
0:29.2	Plus, the year-old used cars selling for almost a fifth more than what they cost new.
0:34.7	But what tops the list?
0:36.7	Don't be getting set up to date with all the latest
0:38.2	breaking money news. Just go to this ismoney.co.uk or download the app. But first, oh, how we love
0:45.5	premium bombs. As a nation, we have 111 billion pounds worth stash in the grandparents' favourite
0:52.8	savings lottery. While we know we probably won't win a
0:56.4	million, and we realise we're probably unlikely to bag one of the rarer 150, or even 25k prizes,
1:03.5	it's like so many things in life, the little wins that keep us going. Yet even those might be
1:09.1	harder to come by than you think, according to a new
1:11.7	piece of research, which worked out how long you'd have to wait for the prizes. By the way,
1:17.1	for a better than half chance of winning £1 million of £1,000 in bonds, it's 3.2 million years Simon I know we like premium bonds but I'm not sure they'll be around in 3.2
1:34.5	million years no but it's worth noting that just because a data scientist has crunched the numbers
1:43.2	and said that for a better than 50% chance.
1:46.5	So it's not a guaranteed chance, but it's a better than 50% chance.
1:50.0	And I'm not really sure how statistically that actually computes into being how close to guaranteed or not.
1:56.5	But anyway, a better than 50% chance of winning a million pounds with £1,000 pounds in premium
2:02.3	bonds, you'd have to wait 3.2 million years. It does not mean that it won't happen because
	...

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