by Diane writer

Created on: April 01, 2008   Last Updated: January 15, 2012

I had heard of Premium Bonds through elder family members as I was growing up and had enough spare money to invest in them.
Ernie as the machine is called is a bit like a lottery you invest your money in the bonds and these are entered into a monthly draw. If your numbers come up your a winner. Sounds simple doesn't it?

To buy your bonds though you need to go to the post office and get a bond form, most post offices have them on the shelves which you always seem to look at whilst standing in the queue, if they aren't there them you can ask at the counter.

Each bond costs one pound but you have to buy them in denominations of a hundred ,so in fact you need a hundred pounds spare to invest. Which if like me your not loaded then this amount is a lot to pay.

Fill in the form enclose your cheque and the bonds will be sent to you as soon as the form is processed. Now you might think that's all there is too it but when you pay your money you have to wait one month before your numbers are entered into the draw. I suppose this is so that there is time for your form to be processed and the numbers allocated to you printed on your bond form. Also your money is used by the premium bond company to invest in the stock market, I suppose the interest accumulated is what they have spare to use in the monthly draw.

Your bond certificate will have your numbers printed on it and your name. You can buy premiun bonds for other members of your family like the grandchildren or children under 18.
If you buy the bonds for children or grandchildren any money won will go to you until they reach the age of 16.
I so far haven't won anything but have known friends who have won the odd fifty pounds.
When you invest your hundred pounds you don't get any interest on your investment , unless you win in the draw you never earn a penny more than your initial investment.
You will be automatically contacted if you win, you don't
have to keep track of the draws, so remember to let the company know if you move address otherwise they will send the cheque to the last address they have for you.

Then when you come to the time where you need to get the money back say if your a bit skint or are fed up of waiting for a win that never comes, you have to write off for a form to request the money back.
You can also get a form from the post office, but now comes the hard part. The premium bond company want you to write down all the numbers of your bonds that you want to surrender. Yes, all hundred of them or more if you are cashing in any others.

I'd like to see this system updated as it's a pain writing down all the numbers of your bonds, I think the monthly draw should be made to be every week and the prize money shared into small and more accessible prizes. With lower payouts they could have more people winning, after all think how many people invest and get nothing for years and then get only fifty pounds for the company having the use of their money.

I'd recommend you buy bonds only if you have the spare cash available to be able to forget about it, the chances of winning anything are slim. Like I said in the three years I have had bonds I haven't won but there's still the chance, we can live in hope.

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