Welcome to 5487, the year you win £1,000 on Premium Bonds! – Monday Musings 11/10/2021
This is the headline on an article in the Sunday Times which I feel no shame in using this week. I will leave the article to speak for itself.
A saver with £1,000 stashed in premium Bonds would have to wait more than 200 years before they had a 50/50 chance of winning £50.
You would have to hold the same stake for 1,155 years to have a 50/50 chance of a £500 prize, 3,466 years for a 50/50 shot at £1,000 and more than 60,000 years before an even chance if winning £5,000.
Approximately £111 billion was saved in Premium Bonds in March – half of all the deposits in the Treasury-backed National Savings Investments.
Premium Bonds, which have been around since 1956, give holders the chance to win money in monthly prize draws. The money the bank would have paid out in interest is pooled and paid out in prizes ranging from £25 o £1 million. Most customers do not win; there are 3.3 million prizes each month and more than 21.4 million Premium Bond holders. Fewer than 100 monthly prizes are worth more than £5,000.
The Premium Bonds are advertised as having an annual prize rate of 1 per cent, indicating that for every £100 paid into the bonds, an average of £1 is paid out.
You buy £1 bonds, and each has an equal chance of winning – the more you buy, the more your odds improve.
NS&I says you have a 1 in 34,500 chance of winning £25 from a £1 bond. The same bond has a 1 in 56.2 billion chance of winning £1 million. The maximum you can hold is £50,000. Ernie (the NS&I’s electronic random number indicator equipment) generates random numbers for the prizes.
According to Zelin you would wait eight and a half years before £25,000 of Premium Bonds has a 50/50 chance of winning £50. You would have to hold them for 46 years for a 50/50 chance of winning £500 and 139 years for a £1,000. If you saved £25,000 in an easy access account over nine years, getting the average interest rate each year you would have made more than £1,000.
Even those with the maximum £50,000 stake would need to keep them for 23 years to get a 50/50 shot at winning £500, 69.3 years before you had the same chance of winning £1,000 and 1,215 years to get a 50/50 chance of the £5,000 prize. If you held them for 64,398 years you would then have a 50 per cent chance of winning one of the two monthly £1 million jackpots.
So, to the markets
|04.01.2021||11.10.2021||% Change||% Change on week|
|FTSE 100||6571.80||7095.55||Up 7.97||Up 0.97|
|Dow Jones||30105.26||34746.25||Up 15.41||Up 1.22|
|Nasdaq||12696.74||14579.54||Up 14.83||Up 0.09|
|S&P||3695.49||4391.34||Up 18.83||Up 0.79|
|NIKKEI||27228.07||28048.94||Up 3.01||Down 2.51|
|Hang Seng||27431.07||24837.85||Down 9.45||Up 1.07|
|Shanghai||3502.13||3592.17||Up 2.56||Up 0.67|
|CAC 40||5584.96||6559.99||Up 17.46||Up 0.65|
|DAX||13733.08||15206.13||Up 10.72||Up 0.33|
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