Over the decades, many myths have emerged around the Premium Bonds prize draw. Around 23million savers have the nation’s best loved savings product.

The bonds are tax-free and, unlike lottery-style draws, you never lose your original stake. 

While a win is not guaranteed, the monthly prize fund is equivalent to a return of 4.65 per cent (it drops to 4.4 per cent from March 2024 after a recent cut).

There are two coveted £1million prizes each month, which is the reason many savers hold out for Premium Bonds.

We look at some of the most popular myths about Premium Bonds and ask National Savings and Investments whether there is any truth behind them.

Almost 23million savers call National Savings & Investments home for their next eggs. Two £1million prizes are up for grabs in each monthly prize draw

Almost 23million savers call National Savings & Investments home for their next eggs. Two £1million prizes are up for grabs in each monthly prize draw

Almost 23million savers call National Savings & Investments home for their next eggs. Two £1million prizes are up for grabs in each monthly prize draw

Myth 1: Only new bonds win prizes  

It has become a popular myth that new premium bonds have a better chance of winning prizes than older bonds.

Some NS&I customers have even asked whether they should cash in their old Premium Bonds and buy new ones in the hope it will help them win a prize.

Savings experts say that the main thing is not how long you have held the bond for, but the amount of bonds you hold, as boosting the amount you hold can help to boost your chances of winning a prize.

Premium Bonds Winners

Prize Area Value of bond
£1,000,000 Warwickshire £5,000
£1,000,000 Nottingham £31,020
£100,000 Inner London £5,000
£100,000 Manchester £1,950
£100,000 Buckinghamshire £10,000
£100,000 West Yorkshire £50,000
£100,000 South Scotland £30,000
£100,000 Lincolnshire £22,000
More January 2024 winners

View list of January 2024 winners

The reason it seems that newer bonds are luckier than older ones is because over 95 per cent of eligible Bonds have been bought since the year 2000.

Even though Premium Bonds have been on sale for over 60 years, this is why newer Bonds seem to win more frequently.

A spokesman from NS&I says: ‘Every £1 invested buys a unique Bond number. Every number has a separate and equal chance each month of winning a prize, and the more Bonds you buy, the more chances of winning.’

Myth 2: Certain areas are luckier than others for prizes

One of the biggest Premium Bonds myths is that the areas in the South East are the luckiest when it comes to winning prizes.

In the last 29 years, National Savings and Investments has created 512 Premium Bonds millionaires. 

Of these, 28 £1million jackpot winners have been based in Surrey, 23 in Kent and 22 in Essex.

Our analysis shows that Surrey, Kent and Essex account for 13 per cent of all Premium Bonds jackpot winners since 1994.

NS&I insists that if it seems as though more prizes are won by holders in certain areas of the country then it’s likely to be because there are more bond-holders there compared to other parts of the UK.

The South East is home to the most UK bondholders.

NS&I says: ‘If it seems as though more prizes are won by holders in a certain area of the country then it may be because there are more Bonds held there compared to other parts of the UK.’

Myth 3: You must have the maximum holding to win  

The maximum holding for Premium Bonds is £50,000 and some NS&I customers are convinced that you can only win a prize if you hold this much in Premium Bonds.

In October, our analysis revealed that half of top £1million, £100,000 and £50,000 Premium Bonds prizes were won by those with the maximum £50,000 holding.

Buying more bonds may certainly help to boost your odds of winning a prize, but if you have a smaller holding it is still entirely possible to win a prize.

The smallest holding ever to win the jackpot was £17 and this winner was based in Newham, London. While 12 people holding £1,000 and under have scooped the £1million jackpot prize, showing that small holdings can still win big.

NS&I says: ‘In the three draws between August and October this year, over 29,000 prizes have been won by people with holdings of £50 or less including three who have won high value prizes of £10,000 or more.

‘In the most recent draw (December 2023) one of the jackpot winners from Essex has £14,600 in Premium Bonds.

‘In November’s prize draw one of the jackpot winners from West Mids has a holding of £5,050 in Premium Bonds.

Myth 4: Ernie is not random  

Ernie – which stands for Electronic Random Number Indicator Equipment – is NS&I’s random number generator. It is responsible for drawing over five million prizes each month.

But some people believe that the way prize winners are picked is not as random as Ernie’s name suggests.

NS&I says: ‘Each month, the Government Actuary’s Department (GAD) carries out an independent check to ensure ERNIE’s output is random. GAD then issues a certificate to confirm that it has no reason to believe the draw isn’t random.

‘We publish numbers and pay out prizes when that certificate has been issued by GAD at the end of each month.’

Other Premium Bonds conspiracy theories investigated…

In November 2022, we put a number of conspiracy theories over Premium Bonds to NS&I

This included numbers not being able to win twice; cash-in warnings resulting in wins; ghost owners ‘unfairly’ winning; letter-starting bonds are duds; having larger blocks gives a bigger chance of winning; newer bonds win more frequently and certain regions being far luckier.

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This post first appeared on Dailymail.co.uk

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