My nan’s had the same Premium Bonds since 1987. She has never won more than £25. Last Christmas, she says she’s cashing them in to buy new ones because “new bonds win more.” I asked where she’d heard that. “Everyone knows it, love.”
That belief lies right at the heart of the NS&I Premium Bonds myth. And no, they don’t. Because it’s bollocks.
The Myth That Won’t Die
People genuinely believe older Premium Bonds are cursed or something. They’ve had theirs for twenty years and won nothing decent, so clearly the answer is to buy fresh ones. Then the wins will roll in.
Martin Lewis called out this NS&I Premium Bonds myth on his BBC podcast in December 2025. Said it was “absolute nonsense.” Yet people still do it. Still think they’re being clever.
Here’s the truth. Every single £1 bond has the same chance of winning. Doesn’t matter if you bought it yesterday or in 1957 when they launched. Bond number 1 has the same odds as bond number 129 billion. The current odds are 22,000 to 1 per bond per month. That’s it.
So why do newer bonds seem to win more? Volume. People buy way more bonds now than they did decades ago. In the 1960s, folks bought £10 worth. Now they’re dropping £10,000 at once. More new bonds exist, so more new bonds win. Not rocket science.
What the Odds Actually Mean
The prize fund rate is 3.6% right now. Sounds alright, doesn’t it? But that’s not what you’ll get. That’s the average across every bond in existence. Most people with typical luck won’t see anywhere near 3.6%.
Got £10,000 in bonds? Your realistic return with average luck is probably around 3% to 3.3%. Maybe. Some win more. Loads win less. My mate put £5,000 three years back. He’s won £75 total. That’s 0.5% per year. His missus stuck the same in a savings account at 4.5%. She’s made about £675.
He still reckons his bonds could pay off big any month. They won’t.
Odds of Winning Premium Bonds with 10,000
Right, so you’ve got £10,000 sitting there. What are your chances?
Each month, you’ve got roughly a 36% chance of winning something. Sounds decent until you realise most wins are £25. Your chance of winning the million quid jackpot? About 1 in 66 billion per month. You’d need to hold those bonds for 5.5 million years to expect one big win statistically.
Over a year with average luck, you might win £250 to £400. That’s a return of 2.5% to 4%. The problem is, you don’t know which. Could be nothing. Could be more. It’s random.
A Premium Bonds calculator will tell you the same thing. The maths doesn’t lie. You’re better off in most savings accounts paying 4.5% guaranteed.
Odds of Winning Premium Bonds with 50,000
Now if you’ve got the maximum £50,000, your odds improve massively.
You’ve got an 87% chance of winning something each month. You’ll probably win multiple prizes. Still mostly £25, but at least it’s regular. Expected annual return with average luck is around £1,600 to £1,800. That’s roughly 3.2% to 3.6%.
Your chance of winning a million? Still rubbish. About 1 in 13 billion per month. But at least you’re seeing regular wins.
The tax-free bit matters here. If you’re a 40% taxpayer, that £1,700 in prizes is genuinely worth £1,700. Stick £50,000 in a savings account at 4.5%, you’d earn £2,250 interest but lose £900 to tax. Left with £1,350. Suddenly, Premium Bonds at £1,700 look better.
But only if you’re lucky. These are expected returns with average luck. Plenty of people with £50,000 win less than £1,000 per year. It’s a lottery, not savings.
Best Time to Buy Premium Bonds
People ask this constantly. Is there a best time?
No. Doesn’t matter at all.
Bonds bought by month’s end go into next month’s draw. Buy on January 15th or January 31st, and you’re in the February draw either way. No advantage.
Some reckon you should buy just after a draw to get “more chances” over time. That’s not how probability works. Your bonds could sit there for twenty years. One extra month changes nothing.
The only question is whether you should buy them at all.
How to Buy Premium Bonds
If you’re still interested, it’s straightforward. Go to the NS&I website. Minimum £25, maximum £50,000. Set up an account. Takes ten minutes.
You can also ring 08085 007 007. Or use the NS&I app. Or fill out a paper form if you fancy waiting weeks.
That’s it. Nothing complicated.
Why People Stick With Them
My nan knows the odds are pants. She knows savings accounts pay better. But she likes checking the results each month. The tiny possibility of winning big.
That’s the real reason people hold them, innit? It’s not rational. It’s hope. The little thrill when you’ve won £25 even though you’d have earned more elsewhere.
Premium Bonds are government-backed. Your money’s safe. You can withdraw anytime. Maybe this month’s your month. Probably not. But maybe.
For wealthy savers who’ve maxed their £20,000 ISA allowance, Premium Bonds make sense. Tax-free matters. Safety matters. The randomness matters less when you’ve got multiple income streams.
For everyone else? You’re almost certainly better off in a normal savings account. You’ll earn more. You’ll know exactly how much. You won’t waste time checking results.
But you won’t have that spark of hope each month either.
What Martin Lewis Says
Martin Lewis is pretty clear. If you’re investing a few hundred quid and don’t pay tax on savings, Premium Bonds are rubbish. Normal accounts win every time.
If you’re a higher-rate taxpayer with tens of thousands, Premium Bonds become more attractive. Tax-free prizes compete with taxed interest. Still not guaranteed to beat it, but at least it’s close.
For most people? Depends what you want. Certainty? Savings account. Excitement? Premium Bonds. Best financial outcome? Probably a savings account.
The key thing Lewis hammers home is that there’s no trick. No clever buying strategy. No way to improve odds beyond buying more bonds. The NS&I premium bonds myth about new bonds winning more is exactly that. A myth.
Every bond has the same chance. Always has. Always will.
The Actual Bottom Line
Premium Bonds aren’t a scam. They’re not terrible. They’re just not what people think.
They’re not a guaranteed return. Not an investment. Not even really savings. They’re a government-backed lottery where you can’t lose your stake.
If you understand that, fine. Stick £1,000 in for a bit of fun. Check results each month. Enjoy the £25 wins. Don’t expect riches.
If you’re treating them as serious savings, especially with smaller amounts, you’re probably making a mistake. Your money works harder elsewhere. That’s just maths.
My nan’s keeping hers, though. She’s 78. She enjoys checking. And honestly, who cares if she’d earn an extra £30 yearly in a savings account? The entertainment value is worth more.
Just please don’t cash them in and buy new ones, thinking it’ll change your luck. It won’t. Every financial expert says so. The odds don’t care how old your bonds are.
Buy them if you want the thrill. Skip them if you want the money. But stop believing the myths. They’re costing you more than you realise.
