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premium bonds for my 21 year old nephew

1964meb

1964meb

pfm Member
Hi Fishies,

How do I purchase premium bond for my nephew?

We want it to be a surprise but cant seem to do it on line without having to get the premium bonds people to contact the nephew

Any advice pleae
 
I wanted to buy more P.B.s for one of my daughters a couple of years ago, who already has active bonds.. I couldn't as she's an adult (over 16, I think they say ?). An adult can, t appears, only buy for themselves or for children (under 16 ???)
 
Incidentally, as Martin Lewis explains well below, you need a sizeable amount before premium bonds become a worthwhile investment. Someone with £1000 of premium bonds with average luck wins nothing in a year…


Without tracking mine too closely, I always seem to win / earn around the current interest rate, but that will only apply to a larger investment.
 
I’ve found it remarkably poor. I parked some cash there a few years ago and have won a few £50s. It has worked less well for me than conventional investments e.g. Fundsmith, let alone records or hi-fi! I keep meaning to move it.
 
I'm no expert, but I was told by someone who was, that's its a good idea to buy them in baths. Like a standing order thingy.
I sold a Harley for about 6k and put it straight in to bonds, I've had a few 25s and a couple of 50s. It was worth it as interest rate were sheite....and I can get at whenever I like
 
Interesting. On another site, there have been recent conversations where people seem accustomed to a win each month. That said...some who I know to be wealthy are pretty reticent about the size of their investment. One stated that she bought hers in 'blocks of £5k'. I'm not in that league but had been strongly considering throwing £25-50 per month at Premium Bonds, for a year or so. The Martin Lewis view is making me step back a bit.
 
premium bonds are a good investment, but truthfully you need the maximum so far this year I have won £1600 and my neighbour had a £10,000 win. I don’t know what £50,000 in savings will pay you interest a year
 
Years ago my wife and I had £30K each in premium bonds and it was fun each month opening the post to see who 'won' the most. Then the pay out from the bonds was halved so we sold them.

If you have £50K and want it to grow then its better to invest it - I don't consider premium bonds an investment. If you aim for an average of 7% growth by reinvesting the dividends you may double that to £100K in 10 years. After 20 Years £200K and so on. You can see why its good to start young.

You can do even better if that was invested in a SIPP for retirement.

What I did for our youngest was to set up a separate investment account into which I paid contributions. Then at age 23 I had our wealth manager transfer those funds into their own name. I did this as a surprise but my youngest had to sign the prepared documents to receive the funds. It was still a surprised though.
 
Cav said:
I put £20k in 2 - 3 years ago and so far getting a return of about 5%.
Click to expand...
I wondered who was creaming off my share !!!! :D

Yes, PBs are a punt but have the added advantage in only losing one's deposit by depreciation. A further and not to be dismissed advantage is that wins are tax-free. There's also the anticipation of checking them on the second working day each month.

My nephew put (some of) the proceeds of a house sale into PBs as an interim holding measure; £50K for his wife, 1 y.o. and himself. A few months down the line, he won £50K, which leads me to sth I've often wondered.

Is it better to have large nets to catch more fish or lots of smaller ones to catch the stragglers? Furthermore, the older the bonds, the less often they seem to come up as wins c/f newer ones but that may just my finding. Does ERNIE have a sump where bonds finally end up to rot?
 
john howard said:
premium bonds are a good investment, but truthfully you need the maximum so far this year I have won £1600 and my neighbour had a £10,000 win. I don’t know what £50,000 in savings will pay you interest a year
Click to expand...
Anything from nowt to a million…
 
Mike Reed said:
I wondered who was creaming off my share !!!! :D

Yes, PBs are a punt but have the added advantage in only losing one's deposit by depreciation. A further and not to be dismissed advantage is that wins are tax-free. There's also the anticipation of checking them on the second working day each month.

My nephew put (some of) the proceeds of a house sale into PBs as an interim holding measure; £50K for his wife, 1 y.o. and himself. A few months down the line, he won £50K, which leads me to sth I've often wondered.

Is it better to have large nets to catch more fish or lots of smaller ones to catch the stragglers? Furthermore, the older the bonds, the less often they seem to come up as wins c/f newer ones but that may just my finding. Does ERNIE have a sump where bonds finally end up to rot?
Click to expand...
The reason older bonds come up less often is that the vast majority of bonds, 95% of all bonds, have been bought since 2000.
 
Cav said:
I put £20k in 2 - 3 years ago and so far getting a return of about 5%.
Click to expand...
Mike Reed said:
I wondered who was creaming off my share !!!! :D

Yes, PBs are a punt but have the added advantage in only losing one's deposit by depreciation. A further and not to be dismissed advantage is that wins are tax-free. There's also the anticipation of checking them on the second working day each month.

My nephew put (some of) the proceeds of a house sale into PBs as an interim holding measure; £50K for his wife, 1 y.o. and himself. A few months down the line, he won £50K, which leads me to sth I've often wondered.

Is it better to have large nets to catch more fish or lots of smaller ones to catch the stragglers? Furthermore, the older the bonds, the less often they seem to come up as wins c/f newer ones but that may just my finding. Does ERNIE have a sump where bonds finally end up to rot?
Click to expand...
Blimey Cav. That's excellent and reminds this thread that some people seem to be born lucky and some
not so much.

For a nephew, I'd find good medium term financial advice on how to invest for a safe but decent return, and do that. Even 3% will beat most peoples results with PB's and way outrun anyone investing 1-5,000. As has been said, the full 50K is reliable ISH.
 
PB have been quite poor as an investment in recent years as Bank interst rates and other investments have achieved a regular 5-7% compared to the sub 1% for many years pre 2017.

I have yet to win anything big with PB and on average may hit 2% return whcih is substantialy very poor (there are winners and losers!) for max investment over the last six years.
 
Imo the more you put in the better your % returns will be. I’ve got the full amount and regularly see 5% (tax free!) per year.
Fortunately I won £25k about 5 years ago, but since then nothing major, just lots of smaller prizes.
 
wammer said:
Imo the more you put in the better your % returns will be. I’ve got the full amount and regularly see 5% (tax free!) per year.
Fortunately I won £25k about 5 years ago, but since then nothing major, just lots of smaller prizes.
Click to expand...
Yes, a big stake is required to make the chances of a 4%+ return closer to a certainty…but still by no means certain. Tax free is very useful as is facilitating a bit of a dream of winning a good wedge (but the dream shouldn’t totally replace financial sense). PBs are in effect instant access (it takes about 2 days to receive funds).
 
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