Premium Bond Diary update - May 2005

Bearing in mind this isn't insultingly lower than the after-tax £1200-odd ING would have paid you, I wonder if you feel - and will continue to feel - it's worth the shortfall to be in there with the chance of a biggy? Is there any lower threshold beneath which you'd be persuaded to ditch the bonds?

Actually, if you time the buying/selling correctly, then it is only *just* over 12 months' interest lost (not 13) -- you could have bought on 30th November 2003 and sold on 2nd December 2004, losing only 12 months and 2 days interest (plus a few days for money transfer) -- and still been in all

"curiosity" wrote

I assume you mean for a basic-rate taxpayer. A higher-rate taxpayer, of course (and most people with 30K available to put into PBs will probably be HRT payers?), would only get around 900-odd after tax.

Perhaps - the only person I know who's bought bonds to the full quota pays tax at the lower rate. Clearly, as you say, it's a better deal otherwise.

In message , Tim writes

Actually, its surprising how many non and lower rate taxpayers have v.large amounts in PSBs. I think they are accumulated over many years rather than all invested in one go. In the latter case, then I think you are right.

In message , John Smith wrote

The June winners are now on the web

Put your holders number into the appropriate box at

X-No-Archive: yes In message , John Smith writes

You can expect around a four per cent return. IIR, there was a treasury raid on prize money about three years ago which knocked the return down from around six per cent.

In message , curiosity writes

The GBP20K I put into ING Direct is paying GBP70 per month net, which is about ten pounds one per cent more than when the money was in premium bonds. The ING Direct account does lack that little frisson that those brown envelopes used to inspire.

"JF" wrote

Net of what? I'll assume just the basic 20% tax, hence interest rate 5.25% ... [If net of high-rate, 40%, then interest would have had to be 7.0%.]

"JF" wrote

Aren't you a high-rate taxpayer, with all those "Premier" accounts? ;-) If so, then you'd really only be getting 70 / 0.80 x 0.60 = 52.50 per month (after high rate tax). If 70 is only 10 more than "when the money was in premium bonds" (ie they gave 60pm on average), then the premium bonds were actually doing better than ING!

National Savings quote a return of 3.2% APR bought 2 X 30k at the end of may so I will hanging around the letter box come July Had a few 2/ 3 years ago, we tended to get any winings around the mid of the month.

I must say, in mine and others experinece I have noted that we seem to do very well at first then things drop off after a while A friend of mine cash's in once a year then buys back straight away so as to shuffle then up a bit

I will post here my winnings ( fingers crossed )

Bruno

Yes, I have noticed that others I know who have bought recently are doing OK to quite well so I think there is merit in selling up and rebuying. There was a post on a financial forum a few years back from a lady in her 70s who swore that this was why she won so often.

In message , John Smith wrote

What is the logic behind this policy? As each bond has an equal chance of winning any prize there is no reason to sell them. You would actually lose out during the time between selling and when the newly purchased bonds become eligible to be entered into the prize draw.

Perhaps she had the maximum number with a statistical likelihood of winning a prize every month.

"Alan" wrote

The logic would be that new buyers are duped into buying more of the things.

In message , John Smith writes

Buy6ing and selling is a complete waste of time. The vary nature of ernie's randomness means there will always be some results like you describe.

Don't be silly. These are sold by National Savings backed by the high integrity honest New Labour government and, erm, erm. Ok I get your point .............

X-No-Archive: yes In message , Tim writes

Yebbut I had no idea what HSBC's 'Premier' meant until someone on this ng kindly explained it to me. I should've guessed that HSBC wouldn't issue such impressively bound information packs without good reason.

I'm sure you're right but I have a sharp as a ferret accountant who produces imaginative research expenses and even includes 'Radio Times' as a trade journal. At least I thought they were sharp until I saw an alarming report in the local paper in which they were prosecuting a tax miscreant on BEHALF OF THE INLAND REVENUE!

This induced an immediate fainting fit. I made a frantic phone call to my accountants when I'd recovered my power of coherent speech and a partner blandly assured me that the Inland Revenue were just another client. 'Just another client?' I howled. 'They're the enemy!'. He claimed that he and his partners were used to wearing several hats. Yeah

-- but the one I have to wear is riddled with IR bullet holes.

My own PB experience goes as follows: Mar 03 - Buy £6k worth May 05 - Win £50 Oct 05 - Win £100 Jan 04 - Win £50

- - Return on 1st year of holding = 3.33% (grossed up: 5.56%), so not too bad Dec 04 - Win £100 Mar 05 - Win £50

- - Return on 2nd year of holding = 2.50% (grossed up: 4.17%), so pretty poor

Maybe I should stick the money in my offset account instead !