Martin Lewis outlines how Premium Bonds work
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Premium Bonds allow the chance for two lucky Britons to be made millionaires each month, alongside a whole host of other winners. While the savings method is 100 percent backed by the Treasury, this is often not the main motivation for putting away money in this way. The prize draw is the key feature of Premium Bonds for many people, who are willing to forego interest on their cash for the prize pot to be funded.
At the start of each month, some people will wake up significantly richer, while others will sadly be disappointed.
In the latter group, many will be hoping to increase their chances of winning the next time around.
Thankfully, NS&I is on hand to provide a run down of how its draw works, as well as how to “increase your chances of winning”.
There are many theories as to what can help Britons to be more likely to secure a prize each month.
However, these have often been dispelled as just rumour, with the system operating in a specific way.
This is the case for those who believe buying Premium Bonds in a sequence might help them increase their chances.
NS&I has rejected this claim, instead explaining how its Bonds draw works on a monthly basis.
It said: “The machine we use to generate the numbers for each prize draw—ERNIE—generates numbers completely at random, which are then matched to our database of eligible Bonds to determine the winners.
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“Since no Bonds are actually entered into ERNIE, it doesn’t ‘know’ anything about the Bonds themselves, such as whether the Bond number is part of a sequence of numbers or not.”
In this case, how do Britons increase their chances of winning?
Savers may be surprised to find there is no sophisticated trick to increasing their chances.
Instead, NS&I explains individuals will simply have to hold more Premium Bonds to have a greater chance of clinching a prize.
This is due to the fact it is a lottery bond system, and each number has an equal chance of winning.
The current odds of a £1 Bond winning a prize in a given month, for example, are currently 34,500 to 1.
Recently, Money Saving Expert Martin Lewis was also on hand to offer guidance to Britons unsure about their chances of winning.
Appearing on his ITV Money Show, he said: “The typical luck I would define is if we lined people up and everyone had the same amount of Premium Bonds, in order of the person who won the most to the least – I’d pick the one in the middle.
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“That’s the median average.If you got up to around £1,900 in, with typical luck, you’ll win absolutely nothing.
“Then it sharply rises and keeps getting higher until you get to the £50,000. At this point, with typical luck, you’d win about 0.9 percent or £450 per year.
“That’s still less than the prize fund because of all of those million pound winners.”
Premium Bonds are drawn at the start of each month, meaning the next draw is just around the corner.
NS&I states savers can expect the prize checker to be updated with December’s winners on December 5, 2021.
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