Martin Lewis shares your chances of winning Premium Bonds – are they worth it?

Martin Lewis outlines how Premium Bonds work

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Martin Lewis, Money Saving Expert, is well known for offering Britons the latest guidance on money-related issues. The latest instalment of his ITV Money Show was no different, and the expert looked at the odds for Premium Bonds. Premium Bonds offered by NS&I are a popular savings method as they offer the chance to win a £1million jackpot.

However, many are still holding out for a win, with some questioning whether the method is worth it at all.

Thankfully, Martin was on hand to offer his top tips on Premium Bonds, and chances of securing a return.

He said: “The prize fund with Premium Bonds is one percent. So you’d expect you’d win one percent of what you put in each year.

“But of course the smallest prize is £25. So if you’ve got £100 in Bonds, you can’t win one percent, the least you can win is £25.

“So, essentially, it’s all about the probability!

“What you have to understand is for everyone who wins £1million, a lot of people must pay nothing.”

Martin said he analyses the matter by thinking about individuals with “typical luck” and how this pans out. 

He continued: “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.”

An alternative option available to Britons is the more traditional method of saving with banks or building societies.

Of course, easy access accounts remain popular with savers due to their flexibility – but do they have the edge over Premium Bonds?

Martin explained: “Let’s contrast that to easy access at 0.67 percent – the top option.

“Most people with typical luck with over £4,000 would be better off with Premium Bonds than they would with easy access savings.

“But if we take the top one year fix, that’s 1.35 percent. You would have to have very good luck even with the full amount in to beat locking your money away with a fix.

“This means both people would be better off with a fix.”

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A key advantage of Premium Bonds which many people state is that the prizes which are issued are tax-free.

However, Martin highlights this may not be as major of an issue as people might think.

He added: “Most people don’t pay tax on savings, only five percent of people do.

“If you’re in that five percent, these become a much better bet, but it isn’t really an issue for most of you.”

Finally, Martin looked at the key draw for Premium Bonds – the chance to strike it lucky and win big.

While individuals could well secure a significant win, Martin said just as many people will win less, and “it wasn’t that good to start with!”

As a result, he recommended Britons look into different options, including seeing whether they could be better off with a fixed rate savings account. 

Martin Lewis is the Founder and Chair of To join the 13 million people who get his free Money Tips weekly email, go to

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