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Premium savings bonds

Updated on September 3, 2011

Premium savings bonds

Premium savings bonds are a tax free investment available to those living in the UK and Channel Islands. It is estimated that there are currently 23 million holding premium bonds to the value of 26 billion. The minimum initial investment in premium savings bonds is £100, and the maximum holding is £30 000. You can purchase as little as £50 of premium savings bond each month by standing order. You must be over 16 to buy a premium bond but parents and grandparents can buy them for children. The interest that would be paid by the amount of money held by premium bond holders is put into cash prizes. Premium savings bonds are backed by the HM Treasury and are a secure investment whilst giving you a chance to win some prizes. Each £1 bond gives you a chance to win a monthly prize. The premium bond prizes range from £25 to £1 million.

Each month ERNIE draws out bond numbers and these bonds win one of the prizes stated below. The current odds of winning are 24 000 to 1, although this changes with the bank interest rate. You must hold your premium bond savings for one full month before being entered into the prize draw.

Premium savings bonds

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Premium savings bonds

How much money do you have invested in premium savings bonds

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Premium Savings Bonds Prizes

 Prize Value (in £)
Number of Prizes 
1 million 
100 000 
50 000 
25 000
10 000
30 840
30 840

My premium savings bonds

Currently I have £2000 in bonds, I need another 28k to reach the maximum holding. I am planning on investing the full £30 000 in premium savings bonds but that will take time as I am trying to overpay my mortgage with any spare funds I have.

The good news is that my £2000 investment came from my freelance writing earnings and not from my offline job. In the next few months I am planning on investing as much as £100 a month in premium savings bonds. This will increase my chances of winning a top prize. I would love to win the one million pound prize.

To date I have only managed a £25 win, but I am hopeful that I will win more cash prizes in the future, and best of all they are tax free.

Premium savings bonds comments

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      7 years ago


      H.M. Treasury under

      the national loans

      Act 1968.



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