Thoughts on Premium Bonds

[Dan00001]

You actually can easily get the days spot price on gold and silver. Sometimes over that if you go to Hatton Garden or the Jewellery Quarter where there are many dealers that need gold to turn into saleable jewellery. So it’s a very good investment, especially since 2008. A year ago an ounce of gold could be bought at £1500 or below. You can sell it now for £2200

Gold has actually been a very, very good investment, beating the returns of the S&P500 since 99' by almost 3x. And it will continue to be a good investment because unlike currency money, it cannot easily be counterfeited and it's supply not easily increased.

 

[TeeDee]

Gold has actually been a very, very good investment, beating the returns of the S&P500 since 99' by almost 3x. And it will continue to be a good investment because unlike currency money, it cannot easily be counterfeited and it's supply not easily increased.

And maybe this will aid that if it comes to fruition.

How the New BRICS Currency Will Affect Gold and Silver

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BRICS expands with new partner countries. Now it's half of world population, 41% of global economy - Geopolitical Economy Report

BRICS expansion: 9 partner countries in January 2025, 4 new members in 2024, now half of global population and 41% of world GDP (PPP), with top producers of commodities like oil, gas, grains, meat, minerals.

geopoliticaleconomy.com

 

[Dan00001]

And maybe this will aid that if it comes to fruition.

How the New BRICS Currency Will Affect Gold and Silver

The BRICS alliance, a coalition of five major emerging economies - Brazil, Russia, India, China, and South Africa - has become a symbol of the shifting...

metalsedge.com

BRICS expands with new partner countries. Now it's half of world population, 41% of global economy - Geopolitical Economy Report

BRICS expansion: 9 partner countries in January 2025, 4 new members in 2024, now half of global population and 41% of world GDP (PPP), with top producers of commodities like oil, gas, grains, meat, minerals.

geopoliticaleconomy.com

I'm not hugely knowledgeable on the subject but I'm all for gold backed currencies. One required characteristic of a good currency is scarcity and what the central banks currently are doing is counterfeiting and theft of labour. It's not the first time in history it's happened. When glass beads were still being used as a currency in Africa, Europe, with the manufacturing abilities to produce glass beads en masse, traded in Africa with their counterfeited glass beads. They were discreet about it, the central banks today are not, they do it in the name of stabilising economies or controlling inflation. Every time they increase the supply of currency money, they are devaluing currency money relative to all other things.

 

[MikeLA]

I’ve had £10 for sixty five years and not a squeak. That ten pounds could have bought an old motorbike back then …….. And if I’d kept THAT!!!!!

So I am not the only one and you will be pleased to hear your not. got some when i was born 60 years ago. Not won anything from them

 

[Toddy]

Older bonds seem to rarely win.
Better to cash them in and buy new ones...right enough you can't just buy ten quids worth now.

M

 

[Dan00001]

I think that's more to do with there being a lot more newer bond numbers than older bond numbers so naturally, the newer bond numbers will win way more often because there's way more of them in existence. Every bond number has the same probability of winning so swapping one bond number for another won't increase your odds. It's the same argument as blocks of consecutive bond numbers vs lot's of individual bond numbers, your overall odds of winning remain the same regardless.

 

[Toddy]

.....and yet, our old bonds don't give us any prizes, while the newer ones do so pretty much consistently.

 

[Dan00001]

Do you have a similar amount of old bonds vs new bonds? For example, if you had 1,000 old bonds and 10,000 new bonds, there's a much higher probability that the winners are going to come from the newer bonds. If you had an even split of say 5,000 old bonds and 5,000 new bonds then the probability would be the same as flipping a coin.

If you believe this to not be the case then you must believe that PB's do not work in the way that NS&I say they work or that there is manipulation going on.

 

[Toddy]

No, it's quite simple. Our oldest bonds were bought in £10 lots, while the newer ones were in the hundreds. So, blocks....and more chance of catching something in the spread of things. Like buying pages of raffle tickets instead of singles.

So far it works well for us, and neighbours, and other family members too.

It's noticeable that the folks supporting the idea seem to be the ones who actually have stakes in the game, so to speak.

 

[Dan00001]

Blocks do not improve your odds of winning, neither does buying consecutive raffle tickets as opposed to buying the same amount of tickets spread apart.

If one person had a consecutive block of 10,000 bonds and another person had 10,000 bonds spread across a vast range of numbers, they would both have exactly the same odds of winning a prize.

 

[Broch]

When it really comes down to it, it's not how much/often you win, but what return you are getting on your investment (obviously). You can currently get 5% on zero risk savings. So, if you have £10,000 of premium bonds and you are getting less than £500/annum consistently, you'd be better off in savings. Even if you are getting 5%, not everyone with premium bonds can be otherwise the system would go bust - it's likely the system makes around 6% on average so must pay out less than that.

Investors only talk about 'points' i.e. percentage gain or loss on investment - not amount.

 

[Dan00001]

When it really comes down to it, it's not how much/often you win, but what return you are getting on your investment (obviously). You can currently get 5% on zero risk savings. So, if you have £10,000 of premium bonds and you are getting less than £500/annum consistently, you'd be better off in savings. Even if you are getting 5%, not everyone with premium bonds can be otherwise the system would go bust - it's likely the system makes around 6% on average so must pay out less than that.

Investors only talk about 'points' i.e. percentage gain or loss on investment - not amount.

Yes, the vast majority of Premium Bond holders win nothing. The current odds each bond number has is around 1 in 21,995 (bonds in existence/number of prizes). That means each bond has a 21,994 in 21,995 chance of not winning a prize. The odds are not favourable.

I'm not anti Premium bonds, I am anti having all of your savings in Premium Bonds. Premium Bonds should be your last port of call, after paying off debt and after deposits in ISA's and SIPP's.

 

[Stew]

I've just had a glance at my premium bonds - had to do a full on reset of all details as I just don't pay attention to it.

I got £100 in 2017, another £200 in 2019. I won £25 in 2022. That's it.

Largely I'm not bothered as it's there and forgotten about with a very very slim chance of a big return at some point so I'll probably just leave it there still.

 

[MartinK9]

.....and yet, our old bonds don't give us any prizes, while the newer ones do so pretty much consistently.

That's my findings too

 

[Toddy]

Blocks do not improve your odds of winning, neither does buying consecutive raffle tickets as opposed to buying the same amount of tickets spread apart.

If one person had a consecutive block of 10,000 bonds and another person had 10,000 bonds spread across a vast range of numbers, they would both have exactly the same odds of winning a prize.

And yet the blocks consistently come up

 

[Dan00001]

If you win a prize, there's higher probability that that winning bond number will be within a consecutive block than a bond on it's own but your odds off winning a prize remain the same regardless of the order of numbers.

This is where people mistakenly think that consecutive blocks increase your odds of winning. They don't, it's just that IF you win, it's more likely to be within a block of numbers.

 

[Toddy]

Yes, the vast majority of Premium Bond holders win nothing. The current odds each bond number has is around 1 in 21,995 (bonds in existence/number of prizes). That means each bond has a 21,994 in 21,995 chance of not winning a prize. The odds are not favourable.

I'm not anti Premium bonds, I am anti having all of your savings in Premium Bonds. Premium Bonds should be your last port of call, after paying off debt and after deposits in ISA's and SIPP's.

Y'see, we are fiscally prudent. We don't do debt, we paid cash for the house, that kind of thing. We're not rich, we live simply, we live within our means. We're quiet, practical people and we don't only do PB's.

I don't do the lottery. I did buy premium bonds, and so far the returns have been well worth it
I acknowledge that I could just as easily have won nothing, but I'd still have my original 'stake' and can get it back when/if I choose.
On the whole I'm very happy with my premium bonds, for us the returns have been worth it, and again, there's the chance to win a larger sum too....and still have my money.
Family and friends are in a similar situation; we're all happy with the PB's.

That's it.
No gold that I need to secure, insure, try to sell if I'm in need.
No hassle, money stashed away and in with a chance to win more.

 

[Dan00001]

Y'see, we are fiscally prudent. We don't do debt, we paid cash for the house, that kind of thing. We're not rich, we live simply, we live within our means. We're quiet, practical people and we don't only do PB's.

I don't do the lottery. I did buy premium bonds, and so far the returns have been well worth it
I acknowledge that I could just as easily have won nothing, but I'd still have my original 'stake' and can get it back when/if I choose.
On the whole I'm very happy with my premium bonds, for us the returns have been worth it, and again, there's the chance to win a larger sum too....and still have my money.
Family and friends are in a similar situation; we're all happy with the PB's.

That's it.
No gold that I need to secure, insure, try to sell if I'm in need.
No hassle, money stashed away and in with a chance to win more.

Sounds great and as long as you are happy, happiness and enjoying life is the most important thing

 

[Toddy]

We spoke of this not long since. I reckon contentment is a great wealth.
I think it's a state of mind, but then by nature I'm an optimist.

Life can be stressful enough; why make it harder ?