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Date: June 2, 2025
National Savings and Investments (NS&I) has issued a critical alert to millions of Premium Bond holders, urging them to review their accounts to ensure their savings remain eligible for the upcoming prize draw. The warning comes as some savers risk unintentionally disqualifying their bonds by exceeding the £50,000 holding limit, which could prevent them from participating in the monthly prize draws offering tax-free prizes ranging from £25 to £1 million.
Why Your Premium Bonds Could Be at Risk
Premium Bonds, a popular savings scheme backed by the UK Treasury, allow savers to invest up to £50,000, with each £1 bond entered into a monthly prize draw. However, NS&I has highlighted that some account holders are inadvertently breaching this limit, particularly those who have set up automatic reinvestment of their winnings. When prizes are reinvested into additional bonds, accounts can exceed the £50,000 cap, rendering any excess bonds ineligible for the draw. In such cases, NS&I will return the excess amount to the saver’s nominated bank account, but any prizes won by those excess bonds are voided and redistributed in the next applicable draw.
This issue has gained attention as the prize fund rate for Premium Bonds dropped to 3.8% in April 2025, down from 4%, prompting some savers to reassess their holdings. Despite the reduction, the odds of winning remain at 22,000 to 1 per £1 bond, with over 5.9 million prizes worth £411 million expected in the upcoming draw. However, savers who exceed the limit risk missing out on these opportunities.
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NS&I’s Advice to Savers
NS&I is encouraging all Premium Bond holders to check their accounts before the next draw to confirm they are within the £50,000 limit. Savers can do this easily via the NS&I website, the prize checker app, or by contacting NS&I directly. Those with automatic reinvestment enabled are particularly urged to verify their holdings, as this feature can push accounts over the limit without notice.
An NS&I spokesperson stated, “We want to ensure all our customers have the best chance to win. If your account exceeds £50,000 due to reinvested prizes, any excess bonds won’t be eligible for the draw. Check your account today to avoid missing out.”
Additional Concerns: Prize Payment Issues
The alert follows recent complaints from savers about delays or missing prize payments. Some bondholders reported that their winnings, such as £100 prizes, were neither paid into their bank accounts nor reinvested as expected. NS&I clarified that such issues may arise if savers change their prize payment preferences (e.g., from bank transfer to reinvestment) after a prize is drawn. The organization has advised affected customers to contact their support team for resolution.
Is It Time to Reconsider Premium Bonds?
The recent drop in the prize fund rate has sparked discussions about the value of Premium Bonds. Wealth management firm AJ Bell revealed that two-thirds of bondholders, with an average holding of over £5,000, have never won a prize. Experts like Laura Suter from AJ Bell suggest that savers might find better returns with high-interest savings accounts, some offering over 4.5%. However, the allure of tax-free prizes, including the £1 million jackpot, keeps many invested in the scheme.
Tom Francis, head of advice at Octopus Money, warned, “While Premium Bonds are safe and fun, savers who don’t win may see their money lose value in real terms due to inflation. It’s worth considering whether this is the best place for your savings.”
How to Stay Eligible and Maximize Your Chances
To ensure your Premium Bonds remain eligible for the monthly draw, follow these steps:
Check Your Holdings: Log into your NS&I account online or via the app to confirm your balance is under £50,000.
Review Reinvestment Settings: If you’ve enabled automatic reinvestment, monitor your account to avoid exceeding the limit.
Update Payment Preferences: Ensure your prize payment settings (bank transfer or reinvestment) are up to date to avoid delays.
Check for Prizes: Use the NS&I prize checker tool, app, or Alexa skill to see if you’ve won. Unclaimed prizes currently total £97 million, so don’t miss out
A Final Word
With the next Premium Bonds draw approaching, now is the time to act. By keeping your account within the £50,000 limit and ensuring your settings are correct, you can safeguard your eligibility for the chance to win life-changing prizes. For those questioning whether Premium Bonds are the right choice, exploring alternative savings options may provide a more predictable return. Stay proactive and keep your savings in the game
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