| Do you think you should win at a least a prize if | | | | very safe investment because you won't lose |
| you have invested 30,000 pounds in premium | | | | your money. Unlike any other bonds, you can |
| bonds? There is no guarantee that you will win a | | | | withdraw your money at any time. |
| prize even in your lifetime. But the report said | | | | The negating factor is that you don't earn any |
| that there are 168 millionaires from the winning | | | | interest from these bonds. But you have an |
| the grand prize since 1994. So, you may stand a | | | | opportunity to become a millionaire. In addition, |
| chance to win. | | | | you can use the same bonds for every draw. If |
| Anyone can buy premium bonds. The only | | | | you compare to lottery, then you understand that |
| requirement is the person must be at least 16 | | | | why so many British people invest in these notes. |
| years old. You can invest as little as 100 pounds | | | | In the lottery, you have to buy all the time but |
| or as high as 30,000 pounds. | | | | for premium bonds, you can buy one time and |
| Although the bonds don't give you any interest, | | | | you are entitled for a lifetime opportunity to win |
| but the money which is pooled together from all | | | | 1,000,000 dollars of cash provided that you don't |
| the investors provides a sufficient fund for the | | | | redeem them for cash. |
| cash prizes. You can calculate the interest by | | | | Another factor that many people don't consider is |
| taking the total cash money and divide it by the | | | | the inflation rate. Although you don't lose your |
| total investment. It will come to about 4% for | | | | investment, but the inflation will depreciate the |
| every pound invested. | | | | value of your investment. What you have |
| How do the National Savings and Investment | | | | invested 10 years ago is not going be the same |
| agency determine who is the winner of the cash | | | | worth should you decide to redeem the bonds |
| prizes? Every month, they will draw random | | | | today. You would not be able to buy many things |
| numbers using a number generator which is | | | | today if you could buy them 10 years ago with |
| known as ERNIE. It will prevent any kind of | | | | the same amount of money. |
| pattern. This will ensure that no one can cheat the | | | | Premium bonds are safe investments. Today, the |
| machine. Every bond will have a unique number. | | | | National Savings and Investment firm offer an |
| However, you need to remember one unique | | | | easier way to buy the bonds. You only need to |
| code. This unique code is issued to you as a | | | | call them by phone. Apart from this, you can buy |
| bondholder when you buy your first premium | | | | them from post offices, ATMS or directly from |
| bonds. With this unique code, it can trace to all | | | | the agency. You only need to remember one |
| your bonds that you have bought. | | | | thing. It is risk-free and offers no interest. |
| The good thing about this investment is that the | | | | Nevertheless, it is not inflation-proof. The value of |
| government guarantee it. You can say that it is a | | | | your investment will depreciate over the time. |