Martin Lewis issues urgent warning on Premium Bonds odds – ‘I’m not the biggest fan’


Martin Lewis has built his career around telling people what they should do with their savings and while the Money Saving Expert is open to many products and companies, he usually advises people to steer clear of Premium Bonds. This has proven to be especially true for parents looking to save for their children.

Today on This Morning, A woman named Charlotte rang in to ask Martin where she should save money for her young child.

Specifically, she asked if she put money into a savings account or invest in Premium Bonds.


Martin was fairly blunt in his response: “Look, I’m not the biggest fan of Premium Bonds [and] certainly not for children’s savings, because children have access to some of the best savings accounts on the market.

“So if you’re going to save for them regularly, both Halifax and Barclaycard offer 3.5 percent interest on up to £100 each month.

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“If you’re not saving regularly on lump sums, depending how much HSBC and TSB offered 2.5 percent interest, or you could lock money away until she was 18 in a junior ISA with Dudley building society 2.5 percent interest.”

Martin went on to compare these returns to what’s available through premium bonds: “Now the Premium Bonds Prize rate is one percent, so it’s a lot lower, even based on the prize rate.

“But the truth is most people win less than the published prize rate, and you’re only going to get close to winning the published price rate with typical luck if you’ve got nearly £50,000 in.


“So, while putting money in Premium Bonds does give you the incredibly rare chance of winning the million pounds, based on typical luck, you would be far better putting it in one of those normal savings accounts that I just mentioned.”

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It should be noted on top of premium bonds, NS&I offers a range of savings products.


This includes the following:

  • Junior ISA – 1.5 percent
  • Income Bonds – 0.01 percent
  • Direct ISA 0.1 percent
  • Direct Saver – 0.15 percent
  • Investment Account – 0.01 percent

Savers, in general, are likely to continue to struggle over the coming months as today, the Bank of England elected to keep the base rate at 0.1 percent.

Rachel Winter, an Associate Investment Director at Killik & Co, broke down what this will mean for savers, borrowers, and even the Government: “The success of our Covid-19 vaccination programme combined with the reopening of our economy has led to a surge in consumer activity, which in turn has caused a spike in inflation to 2.1 percent. However, the Bank of England has not yet felt the need to apply the brakes to prevent the economy from overheating, and today it has left interest rates untouched.


“Borrowers will be relieved, including the UK government which borrowed a further £24 billion in May. On the other hand, savers will no doubt be disappointed about continuing low returns on cash, as will retail banks who must continue to charge lower rates for loans and mortgages.

“Given that the government is reducing furlough scheme contributions next month and real wages have fallen, it is expected that inflation will stabilise over the coming months without the need for interest rates rises in the short-term.”


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