The Premium Bonds prize fund rate will increase from 3.00% to 3.15%, effective from the February 2023 prize draw. This follows the rate rising from 2.20% to 3.00% on 1 January 2023.
The change to the Premium Bonds prize fund rate is the fourth upwards change that NS&I has made in the last year, meaning that the prize fund rate is at its highest level in over 14 years, but the odds of each £1 Bond winning a prize will remain fixed at 24,000 to 1, with the changes meaning that the number of prizes worth £50 to £100,000 will increase from the February draw.
If you don't already have Premium Bonds and are interested in giving them a try, the cost per bond is £25, and the maximum amount of Bonds you can open is £50,000. Needless to say, the more Bonds you have, the more chances you have of winning, but you've got to be in it to win it, and previous winners have included people who only bought one Bond!
You have no risk with buying Premium Bonds; you can't lose the money, it's not a lottery or money-at-risk investment scheme; you can withdraw your money at any time, and so if you have a few extra pounds, it's a good investment should you win something, which isn't of course guaranteed, and you won't earn interest on your savings, but you don't have anything to lose!
You can sign up for Premium Bonds HERE, with NS&I.
The chart below shows the expected prize payout for the February Premium Bond draws.
Savers will also benefit from the upward interest rate trend.
More than 870,000 customers holding NS&I’s Direct Saver, Income Bonds and Direct ISA are set to benefit as NS&I increases interest rates across all three accounts.
The interest rate paid on Direct Saver and Income Bonds will increase from 2.30% to 2.60%, whilst the interest rate on Direct ISA will increase from 1.75% tax-free to 2.15% tax-free.
NS&I has also increased the interest rate that it pays on its Junior ISA from 2.70% tax-free to 3.40% tax-free, meaning that 80,000 under 18s will benefit from extra interest on their savings.
Today’s changes mean that Income Bonds are now paying their highest rate of interest since 2008, whilst the interest rate on Direct ISA is the highest it has been since 2013. The interest rate paid on NS&I’s Direct Saver is now the highest it has been since the account launched in March 2010.