30 years of Premium Bond millionaires – Is the UK's most popular savings product still worth it?

It is now 30 years since National Savings and Investments’ (NS&I’s) much-loved Premium Bonds drew its first millionaire back in April 1994. 

But with recent changes to the fund rate, the odds of winning and the number of monthly jackpot winners, are Premium Bonds still worth the investment? 

Premium Bonds are a government-backed savings product that lets you participate in a monthly prize draw, where you can now bag between £25 and £1 million tax-free – but NS&I hasn’t always made Bond holders millionaires. 

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The provider ran its first Premium Bonds prize draw back in 1957 when the size of the jackpot was just £1,000. 37 years later, the prize pot increased to £1 million in April 1994 – so it’s fair to say they’ve aged well, with more than £30 billion awarded to Premium Bond winners. 

The 528 Premium Bond millionaires all received a visit from Agent Million, who delivers the life-changing news. According to NS&I, Agent Million has travelled around 222,000 miles over 30 years, with its youngest winner being just aged three, and its oldest being 98. 

Find out how many Premium Bond holders have been lucky in your area and whether the savings product is still worth it. 

How many Premium Bond winners are there in your city? 

Since the first draw in June 1957, ERNIE has drawn more than 684 million prizes worth £30.5 billion. 

Here’s a breakdown of where all of the millionaire winners over the past 30 years are from. Do you live in a lucky city? 

Surrey takes the number one spot, with 28 Premium Bond holders winning the £1million jackpot in the county.

Essex and Kent come joint in second place, with 23 millionaires in each area.

How have Premium Bonds changed over 30 years? 

While Premium Bonds have already had a lifespan of 67 years (and counting), they only just reached their peak last September when the prize fund rate hit an all-time high, and the odds of winning reached its best. 

But how did Premium Bonds evolve before it hit its peak? 

Number of millionaires 

When NS&I introduced Premium Bonds to the world, believe it or not, the jackpot was only worth £1,000. 37 years later, the provider upped its prize pot to £1 milllion – but even then, there was only one Premium Bond millionaire each month. 

In August 2005, NS&I decided to make two millionaires each month. This lasted for four years until it was dropped back down to one millionaire winner a month in April 2009. 

After going back and forth, it hiked the number of millionaires to two a month again, from August 2014, and the decision has stayed put ever since. 

So, currently, NS&I makes two Premium Bond holders millionaires each month. Other prizes on offer start from £25 and go up to £100,000.

Prize fund rate 

Premium Bonds have a prize fund rate which NS&I uses as a benchmark to determine how many prizes of each value should be given away each month. For example, if the fund rate increases, so does the amount awarded that month, and if the fund rate lowers, the value of prizes follow suit. 

The prize fund rate is an interest rate (currently 4.4%), but it's important to note that any money you invest in Premium Bonds does not earn interest.

With the current 4.4% fund rate which came into affect in March and stayed the same in April, the total value of prizes dished out each month stood between £451 million and £452 million. 

Before this, the prize fund rate hit its peak in September, when it rose from 4% to 4.65% – the highest its ever been. The lift in rate came as interest rates hit an all time high, at 5.25% in August, and the wider savings market also became a lot more attractive, with rates shooting above 6%. 

The new prize fund rate meant a record value in prizes was awarded in September of just over £470 million. The 4.65% rate was frozen until March, when it dropped to 4.4%. But, until then, Premium Bond holders raked in the biggest prize pot NS&I had ever seen. 

To put things into perspective, 10 years ago in April 2014, the prize fund rate stood at just 1.3%. Five years on the rate still didn’t see much movement, with it only upping to 1.4% in April 2019. In 2020, the year of the pandemic, the fund rate dipped 1% – to its lowest level since April 2009. 

It was only in June 2022 when the fund rate finally hiked after two years to 2.2%, and slowly reached its peak in September 2023. 

Odds of winning 

NS&I also tells Premium Bond holders their odds of winning a prize in the monthly draw for every £1 Bond. 

The odds of winning right now is at its best in more than 15 years, at 21,000 to 1 for every £1 Bond. The odds improved in September from 22,000 to 1. 

Again, if we look back 10 years ago, the chances of winning Premium Bonds was 26,000 to 1, and in December 2008, it was a whopping 36,000 to 1. This stayed put until October 2009, when the odds improved to 24,000 to 1. 

Even though we recently saw the prize fund rate fall in March, the odds of winning remained the same, at 21,000 to 1. 

Are Premium Bonds still worth it? 

With the introduction of the £1 million prize pot, an increase in the number of millionaires after 37 years and a record-high prize fund rate, it sounds like investing in Premium Bonds in a no-brainer. 

But, at a time when the base rate is still flying high at 5.25% and the wider savings market is offering inflation-busting rates, Premium Bonds look less attractive. Sarah Coles, head of personal finance at Hargreaves Lansdown, says: “In an average year, the average saver with £1,000 of bonds will win absolutely nothing.”

Remember, no return is guaranteed when you put money in Premium Bonds and while your money is sitting there, it’s not earning any interest either which means your cash is loosing value. 

“While inflation has been so high, this has been really damaging to people’s savings. Even as inflation falls, over longer periods, the cuts in spending power will really add up,” Coles adds.

Currently, you can earn up to 5.2% on an easy-access saver and 5.25% on a one year fix. If you’re on the hunt for tax-free savings, then an ISA will be a better option as your return on £20,000 will be protected from the taxman. 

If you’re looking for something more similar to Premium Bonds, there are other alternatives that offer a savings and prize pot. NatWest, Halifax and Chip are amongst some of the providers who offer prize incentives. 

Or, if you’re still keen to invest with NS&I, you can always opt for its other savings products. Just this week it launched its three-year fixed British Savings Bond offering about the 4% mark. 

That said, Premium Bonds are down to luck – if you’re feeling lucky, there’s nothing to say you can’t give it a go. Plus, you can’t dismiss that it’s the most popular savings product in the UK, with more than 24 million people saving in Premium Bonds. 

“You can’t underestimate the attraction of the chance to win big,” says Coles.