One of this month’s NS&I Premium Bond savers scooped the million-pound jackpot less than two years after buying the bond.
The winner from Outer London bought the lucky bond, 516FV135553, in October 2022, making them the twelfth jackpot millionaire from the area.
But there were also some other notable winners from this month’s draw, NS&I has said.
Andrew Westhead, NS&I Retail Director, said: “It’s not just about our jackpot winners though, as we’re paying out over £457 million in prizes this month.
“One winner from Kent scooped £100,000 with only a £100 holding in Premium Bonds. Another £100,000 winner bought their winning bond nearly 30 years ago in 1995 – I hope it was worth the wait!”
How do Premium Bond prizes work?
NS&I is one of the largest savings organisations in the UK, offering a range of savings and investments to more than 24 million customers. All products offer 100 percent security as NS&I is backed by HM Treasury.
To win prizes, savers must buy Premium Bonds and each investment must be at least £25. Up to £50,000 can be invested and winners are generated during a random prize draw at the start of every month.
NS&I says the more Bonds a person has, the higher their chance of winning a prize.
Prizes are tax-free and divided into three value bands – higher, medium, and lower – each receiving a percentage share of the monthly prize fund.
Prizes in the higher band range from £5,000 to £1 million (with only two £1 million prizes available). The medium band offers prizes between £1,000 and £500, while the lower band awards between £100 and £25.
The annual prize fund rate for Premium Bonds is 4.4 percent and NS&I says the odds of any £1 Bond number winning a prize are 21,000 to one.
A total of 5,935,875 prizes worth £457,062,375 were reported to be paid out in the August 2024 prize draw. However, 124,653,374,131 Bond numbers were eligible for the draw.
While the savings account offers the chance to earn thousands or even millions in “interest” through prizes, it’s based entirely on randomly generated monthly draws. This means some people can go years without winning anything.
A Freedom of Information request obtained by AJ Bell reveals that two-thirds of Premium Bond holders, equivalent to just under 14.4 million people, have never won a prize.
Laura Suter, director of personal finance at AJ Bell, said: “Premium Bonds have long been a popular place for savers to stick their cash and try their luck at winning a prize in the monthly draws, yet new data obtained from a Freedom of Information request by AJ Bell reveals that two-thirds of people holding these bonds have never won a prize. Of the 22.5 million current Premium Bond holders, a staggering 14.4 million have never won.
“According to the latest figures from NS&I, £126billion is held in Premium Bonds, meaning there is a huge amount of money making no return whatsoever when savers could otherwise be raking in interest in excess of five percent if they were to shop around for other cash products on the market.”
Ms Suter added: “Although the overall average holding of Premium Bond holders sits at a more modest £5,185, given there’s a pretty decent chance that amount will not win a prize, savers might be better off considering other options with their cash savings.
“For example, if they took more risk and invested the money instead, putting that £5,185 in the Fidelity Index World global tracker fund 10 years ago, they’d be sitting on a pot worth £16,689 today. Of course, the lure of Premium Bonds is that you might win the big, £1 million prize, but these figures show that it’s very unlikely if you have a small amount saved in the Bonds.”
