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Premium Bonds

Type Investment - Low Risk
Premium Bonds

Premium Bonds

Premium Bonds


Description

If one of your best friends is Lady Luck, this is definitely the investment for you.

The bonds do not pay any interest. Instead all bonds are entered into a monthly prize draw, with two 1 million pound prizes and over a million other cash prizes at stake. Currently the minimum purchase is 100, and the maximum 30000.

Premium Bonds have a long history. The Research department of the Post Office designed and built the original number-picking computer, ERNIE, which was installed at Lytham St Anne's in 1957, in time for the first draw. ERNIE was a quite a computer engineering feat for the time. Now ERNIE is long gone, and the state-of-the-art ERNIE 4 makes the prize draws.

Why in 100 Best?

A fun and exciting investment, with the prospect of a big tax free win, and little downside since bonds can always be cashed in at the purchase price. But if luck's not on your side, and you fail to win anything, remember that, over time, inflation is slowly reducing the value of your investment.
Links
Premium Bonds - at the ns&i site


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Listing contributed by Andy

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Best Personal Finance - Guide To Premium Bonds - Description, Pros, and Cons - 2 votes