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Premium Bonds

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What is a Premium Bond?

The United Kingdom has a unique way to insure bonds that is very different than
the government bonds you buy from the United States. In the United States you
buy a bond and after ten or twenty years the government will pay back the
original money invested and add interest. For example a twenty year bond will
be yield an interest after the time has passed the bond can be returned for the
promise payment. The premium bond that the United Kingdom offers can be
redeemable for the exact amount it is purchased for at any time.

The interest accrued goes into a public fund in which is saved. The interest is
divided and monthly cash prizes are awarded in a lottery style give away. So the
more bonds you buy, the more chances you have to win the cash prize. The cash
prize is nothing to laugh about. Translated to American money, the first prize
on the bond lottery can be over a million dollars.

There are smaller prizes awarded, so if you are lucky you will receive a huge
prize instead of the small percentage the American bond market gives you.
Premium bonds add excitement to investing. You don't have to worry about losing
your money or waiting a long time to collect the interest. It's like being
involved in a lottery without going to the connivance store to buy your tickets
each week. You bond is involved in each lottery and you can cash it in and pull
it out of the lottery if you need the money or you do not want to be involved
anymore.

Unlike the American government bond system where you will not get the interest
if you pull out the money before the stated agreed upon time, the premium bond
system allows you to have more freedom with your money. You can have a nice
savings account and at the same participate in a lottery that can set you up
for life. A machine generates the winners and like the American lottery, you
can check online for the results. The results are even listed in British papers
with the bond number, not the person's name who wins it. It may not have the
hype that the American lottery has, but it still is more fun than waiting ten
to twenty years for an American bond to mature. When the lottery number is
pulled the winner is notified within four days of the lottery.

There are even two prizes in the millions, so there is a chance of winning the
big money twice a month. Even the smallest amount won is fifty ponds which is
about a hundred and ten dollars. That right there is enough to triple the
interest earned in the American bond market. The more premium bonds you buy,
the more chances you have to winning the money. So if you have U.S. government
bonds or an saving account that is pulling in less than three percent monthly,
you might want to look at reinvesting the money into premium bonds and have so
fun as well as having a chance to win over a million dollars.

Are Premium Bonds Worth It?

Premium bonds are becoming more popular everyday. Millions of people are
investing in these bonds and some are questioning if they are really worth it.
Premium bonds were introduced in 1956 as a way to get the public to invest into
the British Government. This was set up like a lottery so that the common man
could save and at the same time have a chance to winning millions of pounds.
Nearly twenty million people, a third of the population now owns at least one
premium bond. Investors can buy these bonds directly from the post office or
they can purchase from the National Savings and Investment firms.

Since interest rates are falling, premium bonds are seen as a safe way to
invest and at the same time have the thrill of winning one of the over million
and a half cash prizes awarded each month. Fifteen percent of the prize money
is used for high cash prizes and another fifteen percent is used for medium
cash prizes. The remaining seventy percent of the money was used to award lower
prizes that are as high as fifty pounds. A fifty pound prize on a one bond is
almost a 500 percent return. Right now you have a 1 in 21,000 chance to win,
but with the bonds becoming more popular, those odds may be greater in the
future.

You have to buy at least one hundred pounds to invest in premium bonds and you
can only have thirty thousand pounds in an account. The bonds are backed and
protected by the national treasury. Anyone who invests can be assured that when
they decide to pull out their funds, the money will be there. Anyone can invest
as long as you are sixteen. Many parents buy premium bonds as a way to pay for
their children's college. Young investors can learn the value of savings and at
the same time get the chance to win enough money to set them up for life.

Unlike lottery tickets, the same bond can win over and over. The more you
invest, the more times you will have a chance to win. The winnings are tax-free
and you can even reinvest the money you win until you reach the thirty thousand
pound limit. It has been reported that the odds in winning has declined in the
last ten years. It is a matter of statistics that the more bonds that are
bought the lower the chance that your bond number will be picked.

The odds are still better than the American lottery because you don't have to
buy a different ticket each time. You can find out if your bond number is
picked by looking at the National Saving and Invest website. Here they list all
the winning numbers and all you have to do is call or contact them for you to
claim your prize. It is recorded that the National Saving and Invest firm has
over five hundred thousand unclaimed prizes that they are holding for claimers.

Why is It Smart to Invest in Premium Bonds?

Most people invest their money in savings bond or the stock market. Premium
bonds are a good way to invest your money and have fun at the same time. Most
savings plans give you set interest rates overtime and unless you have a lot of
money invested, it really doesn't make that much money for you. The meager
interest on a money market account or a savings account will only give you a
few cents and maybe dollars a month. Some of the investment plans will not even
allow you to take the money out of the bank without losing the interest.

In stock market accounts you have the chance to make big money, but most of the
time you will even out as the stocks drop and rise. A premium bond does not give
you an interest rate, but they give you something better. A premium bond gives
you the chance to win a monthly lottery that is well over a million dollars.
The prize is not just for one person. There is actually two grand prizes and
over a million and a half others. If you have $10,000 pounds invested, you have
a 19% chance of winning some sort of cash prize. In other words, the chance or
winning is 1 in 21,000. Not only is the possibility of winning exciting, it is
more fun to look for a win than watch your money sit in a bank when you know
what the final out come will be. The premium bond is like money in the bank and
each bond has a unique number. Each bond costs one pound, and you have to have a
minimum of one hundred pounds to make an order.

The premium bond is so popular in the United Kingdom, that over one third of
the population has saved money in this fashion. Savings accounts and government
bonds are stagnant. You agree to the interest upfront and that interest will not
go up or down. No matter how much money the bank or the government makes on the
bond, you will only get that percentage your agreed to. Even if the bank makes
a twenty percent profit on your investment, you will only get the three to five
percent you agreed on. If you need the money and take it out of the investment
program, you will lose the interest that was promised you. You would have had
the money invested for maybe years and you get back only what you put in.

With premium bonds you can get your money back anytime you want. Since you
really didn't agree on a interest rate, you are not losing anything. The only
thing you are missing out on is the chance of winning one of the prizes.
Premium bond advocates are not promising you anything but a chance, a chance
that has better odds and more chances to win then any lottery in existence.
Even a small reward will out pay any interest on American bank accounts or
government bonds.

Facts about Premium Bonds

Premium bonds are the British answer to the need for savings and the fun of
gambling. Each bond you buy will have a specific number. The number of the bond
is put into a numbers generating machine and monthly thousands of numbers are
chosen randomly to receive a cash prize in lieu of interest. The investment is
completely safe and you can cash in your bonds at value when ever you wish.
There is a thirty thousand pound cap on the investments so large corporations
cannot buy millions of bonds to skew the chance for the common man to win.

There are ways to improve your odds. For example the more bonds that you buy
and hold the more chance you will have in winning a cash prize that can equal
as much as one million pounds. Statistically you have about 23,000 to one shot
with a one pound premium bond. By buying more bonds, your odds of winning
increase significantly. The system is designed to choose number randomly so the
more numbers you have in the system the more money you will make as a cash
prize. You can even sign up for a monthly fifty pound savings program where you
can have the money automatically drawn from your regular checking account.

A thirty thousand pound investment would give you a little of four hundred
thousand chance to one for winning the big million pound prize. So the more you
save the more chances you have of winning enough money to set you up for life.
You can even buy the premium bonds online or over the phone. You can even
purchase the bonds at your local post office. It's that easy. Purchase, save,
and win. Of course not all bonds are going to win you money, but you will have
a nice nest egg to help you in your advanced years or if you run into financial
troubles.

You can buy the bonds for a child or if you are sixteen you can buy them
yourself. It is a great way to save money for college or to put away some extra
cash for when you meet that special someone and want to start a family. If you
win a high end prize you can even pay for your college with the winnings. The
big prize of a million pounds would be enough to set you up for life. So don't
let your young age keep you from purchasing and holding premium bonds. Even if
you are a senior citizen, it is never too late to put away some money for a
cloudy day.

If you win a cash prize, it is free of taxes. So when you win those million
pounds, you get to keep the whole million. You can reinvest and at the same
time live the quality of life you always dreamed of. Even if you one the
minimal prize of fifty pounds, you would have made more money on your
investment than you would have if you put it in a savings account at the bank.

Fun Facts and Myths about Premium Bonds

There are many web pages dedicated to successes of the premium bond program in
Great Britain but there are also some false facts that are circulating around
the net that gives premium bonds a bad name and puts out false information that
would keep some otherwise wise investors from even purchasing their first bond.
This report presents some of this false information so that the discerning
investor can make clear and logical choices when investing their money in the
premium bond system. Remember these are myths and false facts that have been
discounted by the government agencies that were selected to monitor the actions
of the National Savings and Investment agency.

One myth is that the million pound winner is always notified in person on the
last day of the month after the drawing. The winner has to be at home or the
prize will be given to another premium bond member or will not be given away at
all. The myth also supports another. Since you have to be home to win the prize,
the myth says the statistics support the idea that most people that win the
million pounds are in their nineties and that they are home all the time
anyway. Most people in their nineties live in a retirement community or nursing
home and they would not have an address that would support the myth.

There is a ridiculous rumor that nobody has ever met a million pound winner.
This myth contends that it is a government hoax and the sole purpose of this
hoax is to trick people into giving their money to the government in lieu of
taxes. This is completely false. Not only is there a website that lists all the
million pound winners, it even lists the towns they live in and what date they
won. Of course the National Savings and Interest agency is going to keep them
secret because the publicity generated would destroy their privacy and make the
million pounds more of a burden than a pleasure.

There is even a rumor about premium bonds and the famous British comedian
Bennie Hill. Though Bennie Hill died at the age of 92, the myth says he had
just won a million pound prize and he was killed by his jealous grandmother
because of the money. Bennie Hill was already a wealthy man and the age of the
jealous grandmother would make her about hundred and twenty years old. This
does not only make sense chronologically but the woman at that age would have a
hard time killing anyone.

There has even been a website posted with these myths and the challenge for
anyone that has won a million pounds to come forward and dispute the myths. To
this day, no one has posted on the site. This is logical because by posting
they would be giving up their privacy as well as the possibility of setting
themselves up for a scam. The National Savings and Investment is a sound agency
that guarantees your money. These myths are just created to destroy their
integrity.

Success Stories About Premium Bonds

Premium bonds are a great way to invest for your future. Not only do you get
the chance to store your money in a secure environment but you get a chance to
win a million pounds. Some people doubt the system but there is a plethora of
success stories that prove that premium bonds are a good investment and is a
great way to have fun playing the monthly lottery. Each month bond numbers are
randomly picked and if are the lucky investor, you could win a prize from fifty
to a million pounds. The following are some testimonials about the success for
premium bonds.

One lady had a one pound bond purchased for her by her grandparents. Even
though the bond was purchased in 1965, this single bond has been picked twice
for a fifty pound and a hundred pound cash prize. This has spurred the woman to
invest heavily in the program and she encourages her children to invest also.
These two wins have created a saving culture within the family and with other
wise financial decisions; this woman will be set up in her retirement age. Her
family also will be able to save for college and their retirement also.

Another lady in Liverpool stated that she had twenty thousand premium bonds and
that she was disappointed that she didn't win anything after a few months. She
had only won one fifty pound prize after the purchase. She was so up set that
she wrote the National Savings and Investment agency and complained. Not only
did she get a reply and an explanation but she also was notified that she had
won another fifty pound prize and ironically the same bond number she won on
the first prize was the same bond number that was picked for the second time.

This was picked up by a conspiracy theorist who spouted the odds that if one
bond is bought for one person, that person will have a chance of winning every
three thousand years or so. Also that person has a chance of winning the
million dollar prize at the odds of twenty three million to one. He is
skeptical about the ladies story, but refuses to pull out his premium bonds
because he knows it is a safe place for saving and he still has faith that he
will earn a prize, maybe the million dollar prize for his investment. He says
not only he will save but will invest more until he gets to the cap of thirty
thousand pounds.

Another lady supports the theory that newer bonds have a better chance to win
than older bonds. She bought her son a bond in the 1961. Her son never won a
prize for the bond since the purchase. The gentleman bought a new bond last
year and won a fifty pound prize the first month. The theory that newer bonds
win more frequently can be explained by the fact that the population and the
popularity of bonds has increased since the sixties. Therefore the statistics
are slanted more toward the new bonds than the ones bought decades ago.

The Premium Bonds Program Hits A Milestone in Financial History.

Premium bonds have reached a milestone in financial history. At fifty years old
this saving system has outlasted other government and private saving plans and
seems to have enough stem to last decades to come. Not only is the premium bond
a success the nation of Great Britain has embraced the bonds and actually holds
an endearment for them. This is amazing for a system that doesn't pay interest
and actually rewards up to a million pounds to a single investor. Over a third
of the country invests in the bonds and that account for twenty three million
citizens that have a stake in their future and the future of their country.

The big winnings are just the tip of the iceberg with this saving plan. Premium
bonds can be put be bought and exchanged for the exact same value as you put in.
The cash prizes are just the creme on top of the milk when it comes to earnings.
You don't pay a penalty for withdraw nor do you lose anything except the meager
interest that other savings plans have. All you have to do is fill out a
repayment form from the National Savings and Investments agency and your money
will come back to you. You usually only have to wait about a week to receive
your cash in the post.

The sales of premium bonds are going out of the roof. There is a premium bond
bought every ten second in the country and this accounts to about twenty one
million bonds bought a day. The accessibility of purchase has increased in the
last few years due to the availability of online venues. For those that are
less technologically oriented they can go to the post office and purchase them
in person. You have to purchase at least one hundred pounds worth of bonds to
start your saving and you can even have payroll deductions or account
withdrawals that will allow you to save as the purchases are put into savings
automatically. You can save a maximum of thirty thousand pounds and just wait
for the cash prizes to come to you.

The bonds only cost a pound a piece and this bond gives you a chance to win one
of over a million cash prizes awarded monthly. The National Savings and
Investment agency has a random number generator that will pick numbers off of
individual bonds and then report the winnings to the bond holders. The prizes
range from two million pound awards to over a million fifty pound rewards. The
bonds are issued consecutively and a single investment will let you be able to
keep track of your number between the lowest and the highest. The rewards are
also listed online and in most town newspapers.

If you like the thrill of the lottery and the hope of free money coming your
way, the premium bonds program is for you. Your money will not just sit in the
bank and wait to accrue a meager interest. You will be able to get lump sumps
each month if you are that lucky of a person.

The NS&I and Premium Bonds

Premium bonds were conceived in 1861. It was set up so that ordinary people
could save and invest their money if case of accident or death. The original
name of the program was called the Post Office Saving Bank. It popularity
spread an soon the Chancellor was borrowing money from the funds so that he
could support public projects. This gave the premium bonds a duel purpose.
First the bond where considered a source of a secure investment that could not
go bankrupt or could not loose value. Second the bonds were seen as a way to
give the government a source of funds when taxes and other monies were not
enough.

The Post Office Bank sold saving certificates that did offer a lottery system
to go with them. In 1957 a lottery was issued once a month to persuade British
citizens to invest more money. In 1967 the Post Office management changed hands
and the Treasury Department took over. The program was renamed the National
Savings and the Post Office became the major supplier of premium bonds. The
National Savings part of it became a source of other investments besides
premium bonds. In 1996 the post office became the store of the agency and the
National Savings and Investment became more aligned with the Chancellor. All a
citizen had to do was to go to the post office and make a hundred pound
investment toward a bond purchase. They could invest until they reached the cap
of thirty thousand pounds.

Siemens Corp became apart of the operation in 1999. In an attempt to modernize
the agency over 4000 agency employees were sent to Siemens schools for business
to learn new investing techniques. Since then the employees have become more
professional in the delivery of investment services. New call centers were
added and more technology was used in the handling of investment portfolios.
Siemens will end its contract with the National Savings and Investments in 2014
and the agency will be self-sufficient in its own affairs.

Through their training, the employees of the National Savings and Investment
have met goals of improved customer care and the professional implication of
investment opportunities. The use of the internet has made the communication
between provider and customer easier to facilitate and information about the
company can be found at the stroke of a keyboard. As the popularity of premium
bonds grows so will the commitment of National Savings and Investment to
provide their customers with professional, friendly service.

The growth of premium bonds has skyrocketed in the past decade. The negative
impact of the growth is that the chances of having your bond picked by the
random number generator is widening. Statistically the bigger the population of
numbers the gap grows wider for the individual investor to be selected. Many
people are pulling their premium bonds investment and putting them into
traditional low interest savings accounts. This pull back from impatient
investors may reverse the numbers so the chances of winning will grow.

The Difference Between British and Canadian Premium Bonds

Premium bonds, the most successful savings program in British history, has
given the common man a chance to win up to a million pounds in a lottery based
drawing that draws the numbers from the bonds themselves. Other countries are
starting premium bond programs but there are distinct differences between them.
The forty plus years of the British system has made millionaires out of two
people a month and has given several other millions cash prize in lieu of
interest. The great thing about the British premium bond system is that you can
withdraw your investment anytime without penalty or loss of money.

Based off of this model, the Canadian government now has started a similar
program that has very distinct differences. The Canada Premium Bond is a safe
and secure investment is a bond that has interest and even a compound interest.
In comparison to the British system that offers no interest the Canadian system
offers a guaranteed rate of return and offers a higher interest than the common
Canadian Savings bond which is a completely different investment opportunity.
They can be redeemed once a year; where as the British premium bond can be
cashed in at any time.

Both premium bonds are backed by the governments so you can be assured that
your money is safe. Both countries use the money to fund government projects.
This money is used instead of tax money so the investments you make actually
help keep tax increases from happening and saving you money in the long run.
The British system relies more on giving back the money in the form of random
cash prizes while the Canadian system assures their investors a solid interest
rate.

Both premium bonds in both countries do not charge a fee of any kind but the
Minister of Finance in Canada can stop the sale whenever his department
chooses. The British National Savings and Investments have no plans to stop the
sale of the bonds and actually the number of bonds being bought is growing
rapidly. The only negative aspect to this is that the lottery payout system has
to grow because without growth, the odds of winning a cash prize in the British
system may grow wider than most of the investors would want to deal with.

A Canadian investor has the same promises as a British person trying to save
money. The money is guaranteed and though the return is not guaranteed in the
British premium bond plan. Both bond systems are an excellent addition to any
investment portfolio but both countries need to diversify the portfolio
especially if the portfolio is for a long term savings plan for the retirement.
Whether you are a British or a Canadian citizen, both premium bond opportunities
presents themselves as an excellent opportunity outside the mainstream savings
plans that have been the backbone of most banking institutions. You may want to
talk to a financial consultant to find out if either the British or the Canadian
premium bonds are right for your portfolio.

Randomness in the Premium Bonds Market

Some people wonder about the randomness of the premium bonds lottery that is
conducted each month. The randomness has been under scrutiny in the past and
the National Savings and Interest agency, the people who conduct the lottery
are scrutinized by an outside agency to provide security so that winners have
an equal chance.

The Government Actuary Department was created for the sole purpose of checking
the premium bond system and the randomness of the numbers. The Government
Actuary Department is not associated with the National Savings and Interest
agency and is does not receive any monetary funds. Just like the agency that
checks the gauges and meters of gas pumps, the Government Actuary Department
just regulates honesty for the good will of the citizens of Great Britain.

There are conspiracy theories that say that only regional areas of the British
Isle win more than others. What these people do not take to mind is that the
population differences as well as economic differences create statistical
abnormalities that skew the awarding of cash prizes. The Government Actuary
Department investigates these allocations and through statistical analysis most
are proven only disparities in population and how many people in each region
actually participates in the program.

The National Savings and Interest agency also takes these allocations very
seriously and encourages investigation from outside agencies. If these false
allocations are true, it could seriously affect the premium bond program and
the agency that supports it. The scrutiny and honesty is the upmost priority of
the National Savings and Investments, and scrupulous behavior is not tolerated.

Another theory is that new bonds win more than old bonds bought decades ago.
The Government Actuary Department explains this by stating that populations
have grown as well as the population of people buying premium bonds. The
randomness remains the same, but if the purchase of new bonds that were
purchased in the last decade is double or triple the amount of bonds purchased
in the decade between 1950 and 1960, the number of winners will mostly come
from the last decade. The general public has a hard time explaining this and
when they have had bonds that have not won ever, of course they think that
there is something fishy with the random number generator or the people at the
National Savings and Investment. The Government of Actuary Department assures
the public that the randomness does not discriminate against older bonds than
newer ones.

The premium bond program relies on the effectiveness of the random number
generator. Some people have suggested the ping pong number generator that
American lotteries use. The only problem with that is that there are millions
and millions of numbers generated to use and the ping pong method. The random
generator that the British system uses has gone through four upgrades and a
fifth is being looked at if the popularity of premium bonds continues to
increase. Premium bonds still remain a great investment and the fun at a chance
of winning will continue to make the program succeed.

Premium Bonds Or Savings Accounts The Choice is Yours

There is controversy about premium bonds and if they are really worth the
investments. If you calculate the odds of winning per bond and the interest
rates for regular savings accounts, the argument could go both ways. On the
positive side a premium bond gives the saver a chance to win over a million
pounds if they are the two lucky numbers picked during the monthly lottery. The
flip side of the coin is that there are thirty six billion losers each month.
There money stays the same, it does not loose its value, but there is no
interest to generate profit. So the government, in all actuality, is using
thirty six billion pounds worth of British money for free.

People who are skeptical about premium bonds contend that the reason the odds
are so against the majority of the investors is that the distribution is skew
by the way it awards the prizes. This would allow for the majority of the
investors to have little to no chance of winning a cash prize. Their earning
potential of their money would actually decline because they would not be
earning the interest rate in a regular savings account or the rise of the
earnings if the money was invested in stocks.

If you get past the hope of winning a million pounds then you can look at
premium bonds for what they are. A fun way to save money and at the same time
you can have the excitement of winning the lottery. To look at winning
backwards suppose that one million people put in one pound apiece for the
lottery. One person would win the million pounds, but there would nine hundred
and ninety nine thousand and nine hundred and ninety nine people who would be
losers. Those people would have at least made a small percentage on their
savings. It's a choice between a chance for something big or a small interest
to give you the satisfaction of profit.

Another way of looking at it is to look at the interest rate of a premium
bound. The interest rat of four percent is the estimated payout for your one
pound bond. The government uses the interest to create the prize bank and to
allocate the prizes. So you would expect to win four pounds on a hundred pound
investment. This is impossible because the smallest prize is fifty pounds. It
would take around seven investors to loose their interest for that month if you
won those fifty pounds. Even more people would lose their money to finance the
two million pound give away to two winners.

There is simply a choice in the way you should invest your money and that
choice is yours. Lotteries always provide hope for a better life even though
you know in your heart that winning is a very long shot. Savings accounts
provide security both financially and emotionally because you know that you
will get a return on your money. It is just a manner of tastes and were you
feel more comfortable.

Premium Bonds Is Not Considered Gambling by Most

Premium bonds have come under fire from various groups. This government plan to
give a saving opportunity to the common man allows people to buy premium bonds
for a chance to win a fifty to a million pound cash prize. Unlike American
lotteries, the money that you invest to buy the bonds can be used again and
again during the monthly drawings. The bonds you invest in, the more you have a
chance to win. The can buy up to thirty thousand premium bonds in your lifetime
and the cash winnings can add up nicely if you are consistent.

Some religious groups find this is a way to gamble. Most protestant worshippers
think that lottery or any other money for chance activities is prohibited by the
Bible. What they do not know that you can't lose money in the premium bond
market, you only invest. If you win a cash prize fine, otherwise you can take
your money and cash in the bonds with no penalty. The cash prize just adds the
element of gambling to savings with the chance that you will forfeit your
original investment. The random picking of the bond numbers is just making the
activity fairer to all investors.

In the Bible there is no direct instruction not to gamble. In the Ten
Commandments, thou shall not covet, is mentioned, but this could be interpreted
as coveting another man's wife or property. The idea that money is coveted could
be listed with the seven deadly sins of greed, but is the hope for a brighter
future a sin. Premium bonds offer the saver a safe place for their money and a
hope for money. There is nothing malicious about it. Even some of the money
used by the government who sponsors the premium bonds goes to charitable
organizations.

Even if it is not religiously oriented, there is a strong moral objection to
gambling. There are some people that go over board when they are at a casino or
playing the lottery, but premium bonds do not let you do that. You are not going
to lose money. The money you put in will be able to be collected back anytime
you want. The winnings are an interest given out randomly with no chance of
your losing the investment. It is not gambling. It is a different way to accrue
your interest in a exciting way. Why get the meager interest rates offered by
the traditional financial savings plan? You have the chance of making thousand
percents on your original money.

If you are now swayed from your belief that premium bonds are a system of
gambling, you can purchase the bonds at your local post office and start a
savings account that could make you a rich person. Even if you don't become
another Bill Gates you might get a couple of cash prizes that will be more than
the three to four percent interest you receive in the traditional savings
programs.

Premium Bonds Have Come Under Fire From Various Groups

Premium bonds have come under fire from various groups. This government plan to
give a saving opportunity to the common man allows people to buy premium bonds
for a chance to win a fifty to a million pound cash prize. Unlike American
lotteries, the money that you invest to buy the bonds can be used again and
again during the monthly drawings. The bonds you invest in, the more you have a
chance to win. The can buy up to thirty thousand premium bonds in your lifetime
and the cash winnings can add up nicely if you are consistent.

Some religious groups find this is a way to gamble. Most protestant worshippers
think that lottery or any other money for chance activities is prohibited by the
Bible. What they do not know that you can't lose money in the premium bond
market, you only invest. If you win a cash prize fine, otherwise you can take
your money and cash in the bonds with no penalty. The cash prize just adds the
element of gambling to savings with the chance that you will forfeit your
original investment. The random picking of the bond numbers is just making the
activity fairer to all investors.

In the Bible there is no direct instruction not to gamble. In the Ten
Commandments, thou shall not covet, is mentioned, but this could be interpreted
as coveting another man's wife or property. The idea that money is coveted could
be listed with the seven deadly sins of greed, but is the hope for a brighter
future a sin. Premium bonds offer the saver a safe place for their money and a
hope for money. There is nothing malicious about it. Even some of the money
used by the government who sponsors the premium bonds goes to charitable
organizations.

Even if it is not religiously oriented, there is a strong moral objection to
gambling. There are some people that go over board when they are at a casino or
playing the lottery, but premium bonds do not let you do that. You are not going
to lose money. The money you put in will be able to be collected back anytime
you want. The winnings are an interest given out randomly with no chance of
your losing the investment. It is not gambling. It is a different way to accrue
your interest in a exciting way. Why get the meager interest rates offered by
the traditional financial savings plan? You have the chance of making thousand
percents on your original money.

If you are now swayed from your belief that premium bonds are a system of
gambling, you can purchase the bonds at your local post office and start a
savings account that could make you a rich person. Even if you don't become
another Bill Gates you might get a couple of cash prizes that will be more than
the three to four percent interest you receive in the traditional savings
programs.




Premium Bonds and the Unluckiest Man in Great Britain

There have been many success stories about premium bonds, but there are some
pretty amazing failure stories also. Premium bonds, the British way to save
money for no interest and a chance to win cash prizes have made several people
millionaires and have given cash prizes that will exceed the interest that is
given in banks or other bond programs. The odds are better than the American
lottery and you can cash in your bonds at any time for the exact amount you
purchased them for. For as many successes there are failures that are sometimes
considered the worst luck in premium bond history.

A gentleman bought one hundred pounds worth of premium bonds in 1967. That was
a lot of money to invest back then and the hope of becoming a million pound
winner lingered with the man until this day. He has not won one single cash
prize since he purchased the bonds and that luck still runs with him today. The
average amount of winnings for the average investor is about three to four
percent of the investment put in. This man has not made a single pound, but he
refuses to cash in his bonds and look for another type of investment.

He does have some animosity toward the program but he expresses in a civil
manner. He states that every time he sees an advertisement for premium bonds on
the television he wants to smash the set in anger. Stating that one hundred
pounds was then his monthly salary, he feels the National Savings and
Investment agency has let him down. He does refuse to quit completely and will
not cash in, but he screams he will not put another pound into the system until
he sees a return on his investment. He has since invested into regular savings
bonds where he is earning a meager interest.

His has made several pleas to the National Savings and Investments agency for
an explanation of why he hasn't won, but he has received no answers to his
questions and that infuriates him further. The National Savings and Investments
post their statistics on earnings on a monthly basis but this gentleman refuses
to listen to the math. He just wants an apology and information how he could
not have won in almost fifty years. The man believes that the agency is
responsible for his bad luck and wishes he never became part of the program.

His further irritation is that he would have made an eight hundred percent
profit on those hundred pounds if he had invested in a building society fund.
There is a possibility that the man had been slighted in the early days of the
premium bond because the bond numbers had to be matched by real people and not
a computer and the human element could have missed over his numbers. The man
stated that he just wanted to win once so that his title of the unluckiest man
in Great Britain would go away.

Premium Bonds and the Odds Calculator

A premium bond is a savings plan developed by the British government to give
the common man a chance to be able to save money and at the same time is able
to win money in a lottery instead of interest. The program is very popular and
almost a third of have bought premium bonds to add to their savings portfolio.
There are several tiers to the prizes and the odds to figure out your chances
of winning a certain prize is often difficult. It would take a person several
hours to figure out their odds by doing the statistics and many people do not
have the math skills to perform the operations. Now there are odds calculators
that figure out the odds of winning in comparison to how many premium bonds
purchased.

The odds calculator will allow you to put in the number of premium bonds that
you have saved and through an online connection to the National Savings and
Interest agency you can find out exactly the odds that you will win a big
prize, the two million pounds, or a smaller prize, fifty pounds. You can even
figure out the odds for the multitude of prizes between the higher and lower
amount. The odds can change as more and more people buy bonds. They can go up
if a lot of people suddenly purchase bonds, and they can go down if people cash
in their bonds. Whenever you are in a gambling arrangement, especially with your
savings, it is nice to know what kind of odds you have for winning.

The National Savings and Investments does offer your odds based on the average
number of premium bonds that have been bought in the past. This table is a good
way to figure around what you might earn off of one bond. If you have multiple
bonds, again you would have to do the math to figure out the system. The more
bonds you buy the more chances you will have to win and the odds will be closer
in your favor. There is speculation that with the newfound interest in premium
bonds, the odds will get so far out of reality that many people will opt for a
traditional savings plan that will bear them interest. The ebb and flow of bond
owners will dictate to changing of the odds and with the calculator you can see
what month you will be more likely to win.

Remember that you can pull out of the premium bond program at any time. You
will have the same amount of cash that you started with. Life changes and the
way you invest also changes. You may decide to opt out of the program if you
have a family emergency or have a dire need for cash. The government secures
your money so you do not have to worry about it being there when you are ready
to cash in. Three may even be a better investment down the road and your nest
egg in premium bonds will give you the opportunity to reinvest.

Premium Bond and ERNIE

Premium bonds are bonds that do not pay interest. They do something much
better. You purchase premium bonds and let it sit just like in a savings
account. Each month there is a lottery and if your bond number is picked, then
you have a chance to win over a million dollars. Over one and a half million
cash prizes are given away each month and if your bond number is picked, you
win from fifty British pounds to well over a million pounds. The great thing is
if you do not want to participate in the program anymore you can take back your
money like it was never invested at all. This program is so popular that over a
third of the population of Great Britain participates in it.

Unlike the American lottery system where numbers are picked randomly from ping
pong balls, Great Britain uses ERNIE to generate numbers from premium bonds.
ERNIE is a random number generator hardware system and has been around since
1957. ERNIE first generated the bond numbers by picking up on signal noise from
a bank of neon tubes. It was the size of a mini van and could only generate
about 2000 numbers an hour. The first number generator lasted almost seventeen
years and was replaced by an updated version in 1972.

The computer age came to age in the eighties and in 1988 ERNIE 3 was invented.
The generator was about the size of a personal computer but ran at no where
near the speed personal computers run today. It took ERNIE 3 almost six hours
to generate the numbers for the monthly lottery. ERNIE 4 is being used today
and it came of age in 2004. Working at speeds five hundred times as fast as the
original model, ERNIE 4 uses thermal noise instead of the noise from neon
lights. It can compute over a million numbers and hour

Once the numbers are generated, a staff of hundreds validates the generated
numbers with real bond numbers that the numbers match. Once matched, prizes are
allotted to the public. The machine is checked over monthly to ensure proper
validation and to keep the system honest. With over a million and a half
winners monthly, the machine keeps every thing running smoothly. The
investments pay off as winners are awarded their prizes depending on the order
that their premium bond number was generated.

ERNIE is so popular in Great Britain that the machine actually receives cards
on holidays such as Christmas. Jethro Tull, a poetic singer and song writer
even wrote mentions ERNIE in his song, "Thick as a Brick." The magic of ERNIE
and the thrill of lottery and a chance to win a million has the majority of the
population of Britain investing more and more. The idea that your money can earn
more than a mere one or two percent that savings accounts earn has the British
public flocking to the bank to let ERNIE make them a million.

Premium Bonds The Best Saving Practice for the British Citizen

There are many ways to save your money. Some people do not trust banks or the
government to keep their money and keep it stored in a safe at home or even in
a jar in the kitchen cabinet. The money just sits there with no interest and no
chance of earning anything but a layer of dust. This is a sad way to save for a
rainy day. The money could be in a savings account earning interest or it could
be invested in the stock market where the money could earn a lot or maybe be
lost if the market fluctuates negative. The smartest thing for the British
investor to do with their money is to buy premium bonds.

With premium bonds the investor can save up to thirty thousand pounds. The
investor buys premium bonds from their local post office or they can purchase
them online from the National Savings and Investments agency. They will be
issued a physical paper bond that has an distinct, individual number that
identifies that particular one pound bond. The owner is also registered as the
owner and no person can cash in the bond or collect a cash prize except the
person registered to that bond. If that person dies, the bond numbers die with
them. They can leave their premium bonds to their surviving spouse, but that
spouse cannot cash them in or collect prizes those bond numbers have won. The
spouse can turn the bonds in for new bonds with new numbers.

Each month the premium bond numbers will be apart of a national lottery. Their
numbers may be picked to win up to two million pound prizes or one of the one
and half million lesser cash prizes. The investor has about a 27,000 to 1
chance to win one of the prizes. If they win they will receive their prize in
about a week after filling out a claim application. The premium bond may be
kept in the system and the bond may win more than once. If your bonds do win a
prize, even the fifty pound minimum prize, it will be more than the interest
than you earn in a savings account or playing the stock market. The bond never
loses value and can be cashed in at anytime for use or reinvestment. It is a
fun way to save and your money will earn more than sitting in a jar or in the
back of a safe.

With over a third of Great Britain saving this way, you can be apart of a
national financial phenomenon that has been apart of the British way of life
for over fifty years. Almost every citizen has heard of premium bonds and the
National Savings and Investment agency is promoting the savings program more
now than they ever have before. So unscrew that jar and break open that safe
and put your money where it is safe and earns you a profit. You are also
helping the government fund public projects, contribute to society, and give
British citizens a chance for a better life and a secure retirement.

Premium Bonds and the Difference Between NSI and Banks

When looking for investments such as premium bonds, you might be confused by
the difference between a bank and the National Savings and Investments. Banks
are usually private institutions. When you save you receive an interest on your
money. The interest is determined and set by the bank which generates profit off
of your money. The profit is then shared by the owners or if it is a credit
union, the members share in the profit. The Savings and Investments is an
agency of the British government. When you invest your money goes to pay for
governmental expenditures and the government guarantees the safety of your
money. You can't find that kind of guarantee at a bank.

The National Savings and Investments offer several different investment
packages including the sale of premium bonds. You can either save your money in
an easy access account where you can claim your cash at any time or you can go
for a longer package where your money is invested for several years. These
packages can be and most are tax free. A lot of people do not trust short term
investments so they opt for a fixed rate savings bond. Here the bank will give
you a certain interest, usually higher than a savings account, if you promise
to keep your money with them for a certain length of time. You usually have a
penalty fee if you take it out before it is matured.

If you want to save money and maybe even get a 500 percent interest or more you
may choose the premium bonds program. Premium bonds can be bought at your local
post office at that bond will be exactly worth what you paid for it when you
cash it out. The good thing is that your bond number will be included in a
monthly lottery where you could win as little as a million pounds and as much
as a million pounds. Almost one and a half million winners will be picked out
and paid each month. At 21,000 to 1 odds, you are better off saving with
premium bonds then with the conventional savings account.

If you are buying for a child you can buy premium bonds for children under
sixteen. If you have a thrifty teenager, then at the age of sixteen they can
buy them themselves. Some people opt out of premium bonds and go for more
secure, lower interest bonds that will make some money to help the child
through school or to help them financially in the future.

So whether you choose a bank or National Savings and Investments, be sure to
ask a financial advisor what saving program bests suits you. The investment
strategy that you choose can determine happiness and prosperity in your later
years or the type of education your child will be able to afford. Interest
rates are variable and if there is a national financial crisis, you, your money
and your future could be hung out to dry.

If American Adopted the Premium Bonds Program

The British have found a unique way to invest their money. By buying premium
bonds the citizens of Britain can enter their bond numbers into a lottery each
month and have a chance to win over a million pounds. There are millions of
other cash prizes that awarded to the bond numbers drawn and this cash prize is
seen to be better than interest generated from traditional savings program. The
system is so popular more than a third of the country invests this way. The
investor can pull out their money at any time and there is not penalty or cost
to do so. The money invested is used by the government to fund projects and at
the same time give their citizens a chance to be millionaires.

What would happen if this system was used in the United States? Premium bonds
would be a welcome financial opportunity for American citizens. The current
lottery system is taking in millions of dollars across the country but there
are few winners. Once you buy a lottery ticket you don't get your money back
and you lose that dollar. This is gambling and not investing. The odds of
winning an American lottery are astronomical. One person in Florida in 1999
bought ten thousand lottery tickets. After the numbers were pulled, the person
only won eight hundred and sixty three dollars. The investor lost over nine
thousand dollars in taking a huge chance of winning the twenty three million
dollar prize.

This would not happen with premium bonds. Thought the prize money is not as
huge as the American lottery, the British investor would have twelve chances to
win a million pounds over the course of a year. The chances of winning less
amounts are even greater. The British citizen is allowed to invest up to thirty
thousand pounds into the system and if they don't win they can take their money
out anytime they want. They lose nothing for their investment. This way the
premium bond market is not considered gambling and the investor can be assured
that their nest egg will remain in place.

The problem with premium bonds coming to America is that the government will
have to restructure their thinking of how to save and distribute the funds.
They are making millions now without having to do anything but have the weekly
lottery and pay off the winners. They pocket out the cash without having the
responsibility of letting people have the opportunity to save. Church groups
and other anti-gambling groups will win a victory as they will look at the
investment opportunity as a savings plan and not a gambling operation.

Unlike the British system where the investors purchase their bonds from the
post office the postal service in the United States would probably be
overwhelmed if they had to take responsibility for the program. The United
States would probably benefit by selling premium bonds online and have an
agency that deposits and awards the prizes. This would take a lot of planning
but the American population would definitely embrace it.

How to Claim Your Premium Bonds Winning

Premium bonds are a great way to save money and at the same time have a chance
to winning up to a million pounds. Each one pond bond has a unique number on it
that is put into an automatic number generator machine that produces numbers for
a monthly lottery. If your number is picked you and a million and a half other
investors have a chance to win a cash prize from fifty to a million pounds. If
you have premium bonds you have twelve chances a year to receive a significant
amount of money in lieu of the percentages from a regular savings account.

Some people have won a cash prize for the premium bonds and don't even know
that they have won. They could have moved and their new address wasn't
registered with the National Savings and Investments agency. A notice of their
win would have gone out and the recipient would have never known. The National
Savings and Investments agency will keep the money until someone claims it. You
just have to step up to the plate and claim it. But like many investors, you
don't know how. There may be money out there you just have to ask.

There are online services that will search the National Savings and Investments
unclaimed prize list and let you know that if you have a payment or prize
pending. The great thing about this service is that it is free. You just give
them the bond numbers and they will tell you if you have won. They cannot do
anything with the bond numbers themselves. The bond itself is the proof that
you won when you present it for the prize. The bond number itself is useless to
anyone trying to scam the system.

The investor must remember that the bondholder number is a unique code given to
each holder. The bondholder number will allow the finding service to search all
premium bond numbers you have in your account. If you don't know your number,
it is the number tat was given to you when you bought your first premium bonds.
The numbers are arranged in eight digits and a letter at the end. The premium
bond numbers will have letters throughout the number sequences and will be
distinct from any other sequence. This way you can discern between your bond
holder number and your actual bond identification number.

With most online bondholder checking services, the list of prizes is updated on
a regular basis. Again, just your book holder number is needed and not the
individual numbers from your individual premium bonds. The service will match
the numbers and give you the results, either positive or negative, by email.
You don't have to worry about moving and having the notice sent to the wrong
address. You can even be out of the country and be able to be notified. Both
recent and past numbers will be matched and you will have an answer within a
few days.

Conspiracy Theories About Premium Bonds

As with most things that are concerned with the government, conspiracy theories
are generated to prove or disprove unfairness between two parties or plots to
hurt the population. Premium bonds are not isolated from these kinds of
attacks. Conspiracy theorists have accused the National Savings and Investments
agency of defrauding the public and being bias in the way they hand out the
prizes and pick out the numbers of the bonds. These conspiracy theories are
meant to hurt the agency and they are being reported in blogs and other methods
to bring the idea of premium bonds to a halt.

The National Savings and Investment agency has issued statements that debunk
these theories and preserve their integrity. Their number generating machine,
ERNIE, creates random numbers that correspond with the numbers on the bonds.
Large drawings are held each month and some people believe that the number
generating is fixed. One of the most bizarre theories is that some people
believe that ERNIE is a super computer that knows how a person thinks. People
have even sent ERNIE Christmas and Valentine Day cards to the computer in hopes
that it will sway its picks. This is totally untrue; the machine is totally
random and does not have the capacity to know anything.

Psychologists have made the assumption that even the employees of the National
Savings and Invest agency does not even know how the numbers are picked by
ERNIE. The people that make the theories have a intrinsic need to know how a
process works and when they do not know, they will come up with ideas that make
them feel more comforted. Ironically, most of the conspiracy theories come from
people who have never won any of the cash prizes and they feel that they are
not in control of the situation.

The maximum holding for premium bonds is thirty thousand pounds. A theory
exists that only the maximum amount in the system will generate winners for
those people only. If you do the statistics thirty thousand pounds has a better
chance of winning than if you have just two or three thousand pounds invested in
bonds. Again people with the lower amount of money invested are perpetrating the
theory. With over a third of the population of Great Britain investing the
premium bonds system, so people may never win a cash prize nor see their
investment grow.

There is a theory that only new premium bonds are winning. This may be true.
Though the program has been going on for decades, there has been a surge of new
buying since the one million pound prize was introduced. Again the numbers come
into play, the more that people play, the less chance you will win a cash
prize. As with any lottery system, the more people that play and save, the more
people will lose.

The good thing is larger prizes and more money can be put into the system where
people who win will make a larger profit. By doing the simple math, most of
these theories are debunking themselves.

Can NonBritish Investors Purchase Premium Bonds?

Premium bonds are is the most unique way of saving money in Great Britain. In
increments from a hundred pounds to up to thirty thousand pounds, the
government will secure your money. The government will use your money for civil
projects and in return, the bond numbers on your bonds will be put into a
monthly lottery where you have a chance to become a millionaire. The bonds are
able to be cashed in at anytime, but if you didn't win any of the lottery
prizes, you will just get the cash back that you put in. This is a great way to
save money and at the same time have a little fun gambling with fate.

Who can purchase these bonds? Any British citizen sixteen years old and older
can purchase premium bonds. A young person can start a nest egg for college or
for later life and an adult can save me for a rainy day or for their
retirement. Not only is the money in a safe and secure place, they have a
chance to earn any where from fifty to a million pounds if their bond number is
picked. At least two bond holders a month become millionaires.

Non-British people may buy premium bonds only in Britain. Postal law does not
allow bonds or prize money to be mailed. You have to go to Great Britain in
person and purchase the bonds from a post office or the National Security and
Investments agency. If you win a cash prize, you need to schedule another trip
to the island to pick up your money. The prize money is tax free in Great
Britain, but you may have to check your nation's laws about how much money you
bring back to your homeland without paying taxes or tariffs.

Premium bonds can be redeemed at cash value without loss. So if you are a
foreign investor and need your money, you would have to make a trip back to
Britain to get your funds. There are certain restrictions and fees for carrying
a large amount of money so you might make arrangements with a British bank to
transfer the funds for you. There is also the concern of currency devaluation.
The pound might fluctuate and you would have to suffer the loss during the
exchange of currencies. A severe depression on either shore could cause a
substantial loss. You would have to watch the money market closely to insure
your money was safe for withdrawal

To insure your money you could make a formal arrangement with a British
national to purchase the bonds for you. The bonds would be in that persons name
and a legally binding agreement would have to be made with that person so that
you could cash in your bonds or claim a prize. A certain percentage of the
prize money would have to be given to that person for letting use your money
and their name. A British barrister and an attorney from your country would be
advised.

Premium Bonds and the Northern Ireland Widow

Premium bonds have been a great way to save money in Great Britain and in
Northern Ireland. There is speculation amongst the Irish citizens that most of
the prize money is allocated to the British Isle and they are shortchanged on
the winning. The cash prizes given out to premium bond holders are based on the
bond number. The more bonds you buy the more chances you have to win a cash
prize. The population of Britain far exceeds the population of Northern Island
so statistically the winnings would be less frequent. The salary range for the
average citizen in Northern Ireland is less so there are not as many
individuals able to invest the cap of thirty thousand bonds. It is just simple
math not a conspiracy.

Over a million prizes are given out each month that range from fifty pounds to
two one million pound prizes. The ERNIE random number generator puts out the
winning numbers each month and the winners are notified about their winnings.
This does not stop conspiracy theories though, either in Northern Ireland or in
Great Britain. A lady in Northern Ireland reported that she had inherited
premium bonds from her dead husband and the National Savings and Investments
refused to acknowledge her rewards. She even claimed that it was because she
was Irish.

A local radio station took up the woman's problems and called the National
Savings and Investment. They found out that only the original owner can claim
the prizes and that nobody can inherit the premium bonds. This means if your
spouse dies and has the maximum thirty thousand pound investment, the surviving
spouse will not see a penny of it. There was no conspiracy against the Irish
widow, but there was a loophole in the premium bond contract that let the money
be kept by the government. The bonds cannot be transferred to another name after
a death, but they can be cashed in for new bonds. There is more than three
hundred thousand pounds unclaimed in Northern Ireland alone. So instead of
looking at the conspiracies of the National Savings and Investments, they
should be looking to see if they have a winning bond.

The Nations Savings and Investments agency has a free tracing service that can
track down your numbers for you and see if you have a cash prize waiting for
you. Even if the bond is forty years old the agency can track it down for you.
If you have a claim you can fill out the payment order and about seven days you
will receive your cash prize.

So next time you feel that the National Savings and Investments are trying to
swindle you out of your money or that there is a huge conspiracy against you,
contact the agency and ask. They are always willing to help you with your
particular problem and will gladly provide the tracing service for you. You can
contact the National Savings and Investments online or call their toll free
number. You can find contractual information about premium bonds at your post
office or you can get the contract information directly from the National
Savings and Investments online.

Premium Bonds and Islamic Law

Premium bonds have been debated for decades over their ability to actually beat
out interest bearing savings plans and conventional banking practices. Premium
bonds allow the bond buyer to participate in a monthly lottery that picks out
individual bond numbers. If your bond number is picked you are awarded a cash
prize that can range from fifty pounds to a million pounds. Your investment is
safe and the government uses the money to fund public projects. There have been
conspiracy theories and other grumblings about the premium bond system and now
there are religious concerns.

A recent ruling in the Islamic world has made premium bonds ownership against
Islamic law. Muhammad Adam al-Kawthari has interpreted the Koran in stating
that contrary to shares, premium bonds are a loan instead of a partial owning
of a company as in shares. The act of making money off of your own money in the
form of interest is considered usury and takes away from the pillar of faith
that represents being charitable. Islamic scholars have declared all bonds that
produce interest as unlawful. Even a premium bond cash prize is considered apart
of interest and cannot be allowed.

Is the Islamic religion is against premium bonds, imagine what the sales with
be like if it was suddenly made lawful. The sale of bonds would go up and the
odds would be skewed a little. The Moslem population in Britain might bring
many millions of pounds into the government coffers. The funds generated could
help Britain pay its war debt and at the same time finance British troops
occupying Islamic countries. The Cleric might have made the decision to degree
premium bonds unlawful for this very reason. It might be a good idea for the
National Savings and Investments or the government to issue a statement that
the funds will not be used for military or war funding.

The government is working on a way for the Islamic citizens to be able to
participate in the premium bond programs. The Islamic financial systems work on
investing on a fixed asset and even Pakistan has Islamic bonds issues to finance
its roadways. If the British government figures out a way to do this then they
will be able to be the first Europeans ever who are able to allow the Islamic
world to participate in the premium bond market. This will boost sales and
allow the British Islamic citizen to have fun and save their money in a secure
way.

The National Savings and Investments are running against other investing firms
that are trying to secure financial relationships with the Muslim communities.
Lloyds TSB, one of the largest banks in the country, announced that they have
structured Islamic accounts that will be offered to Muslim investors. The
account will remain respectful to the Islamic law and at the same time give the
investor a secure way to keep their money in a bank and earn money without the
idea of interest. Premium bonds may not be the allowed in the Islamic world,
but new plans are on the way.

Bizarre Facts About Premium Bonds

Premium bonds marked their fiftieth anniversary in November 2006. They have
been the most popular form of investment in British history. Premium bonds are
bought and kept by over 40% of Great Britain's populations. Where traditional
investments yield a small return over time, premium bonds yield no return at
all but give the investor a chance to win a monthly lottery. This popular
investment strategy have made millionaires out many British citizens and at the
same time provided the investors that didn't win a secure place to save their
money and help out the national treasury. They have the option of pulling out
the money at any time without loss. Here are some bizarre facts that surround
these popular bonds.

From its conception until the late eighties there was even a beauty contest to
celebrate the premium bonds program. The National Saving and Investment agency,
the department in charge of the bond program, held an annual Miss Premium Bond
competition in which employees of the agency entered during the annual Civil
Service Sports and Social Club Day held in Lytham St. Annes. Just like regular
beauty pageants, the competitors would walk down the catwalk flaunting their
looks and style. They would smile politely to the judges and then answer
questions related to the pageant. No other investment company has ever
sponsored such an event.

Similar to the American lottery there has been some weird stats derived from
the program. Similarities from the statistics include that Hannah is the most
frequent name that has won a premium bonds lottery and Sean was the most
frequent male name. The ten top readers were all female except for one. Some
winners don't even claim their prizes. There is an unclaimed prize for twenty
five thousand pounds waiting patiently for the owner to claim. There are also
more than five hundred thousand pounds stored at the agency just waiting for
somebody to come and take it home.

There are even conspiracy theories that call the premium bonds program a scam.
There are people who will cash in their bonds and then buy new them so that
they will have modern numbers. The first bond ever bought is still in the
system, but these people believe that only new numbers will be generated from
ERNIE the famous number generating machine.

Other conspiracy theorists have come up with ideas that the machine is
prejudiced to what region of Great Britain the winners will be chose from. One
man in Wales even has said that the bonds were rigged because Wales had the
fewest amount of winners. What he failed to realize was that fewer people in
Wales bought premium bonds and that naturally the statistics would favor a
larger buying population.

As there is winners there are also losers. You can't really loose because the
bonds are cashed in at the same amount they were bought at. One gentleman
reported that he had never won in twenty years. He states he has even stopped
looking at the monthly numbers. He could be one of the people who has never
claimed the over five hundred thousand pounds that have never claimed.





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