Premium Bonds vs Savings Account: Which Wins?
Premium Bonds have a 4.15% prize rate — but the median holder earns 0%. Easy-access savings usually beats them unless you hold the £50k max.
NS&I Premium Bonds replace interest with a monthly prize draw. The headline 'prize rate' is the total prize fund divided by total bonds held — it's an average, not what you'll actually win.
Who Premium Bonds suit
Higher-rate taxpayers who've used their £500 Personal Savings Allowance, and people who like the lottery upside. Prizes are tax-free.
Who they don't suit
Anyone with under £10k invested. With small holdings, most months you win nothing — the median return is 0%, not 4.15%.
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