NS&I customers urged to 'cancel' Premium Bond accounts before December

NS&I customers urged to 'cancel' Premium Bond accounts before December
-Credit: (Image: Reach Publishing Services Limited)


National Savings and Investments customers have been warned to consider CANCELLING their Premium Bonds. It comes after NS&I, which is backed by the Treasury, warned the odds of winning would plunge in the December draw.

Steven Kibbel, financial planner and chief editorial advisor at Gold IRA Companies, warned Premium Bond savers that they "can’t count on them as a solid way to grow your savings anymore". He explained: "We’ve already seen cuts, and more could follow.

"NS&I adjusts its rates depending on a lot of factors, and they’re not immune to the economic shifts we’re all dealing with. It’s smart to keep an eye on alternatives and spread out where you put your money. Relying on Premium Bonds alone doesn’t cut it for most people these days.

READ MORE UK tourists ordered to 'leave' Tenerife and Lanzarote warn 'it's scary'

"You want stability, and unfortunately, Premium Bonds just aren’t offering that right now." Mr Kibbel said: "People should consider where they are in life and what their savings goals are. If you’re after long-term growth, focus on accounts that guarantee returns.

"If you’re okay with a little uncertainty, then maybe keep some money in Premium Bonds, but I wouldn’t bet on them being your main savings vehicle anymore." Andrew Westhead, NS&I Retail Director, said: "As the savings market continues to change, we need to lower the rates on some of our products to help us meet our Net Financing target, while also ensuring we continue to balance the interests of our savers, taxpayers and the broader financial services sector.

"Even with the changes, we’re still expecting to pay out over 5.7 million prizes worth over £435million in the December Premium Bonds draw." With today's top easy-access rate of 5%, it now takes £20,000 in savings for basic-rate taxpayers to exceed the personal savings allowance and start paying tax on the interest (£10,000 for higher-rate taxpayers).

So the fact that Premium Bond prize winnings are tax-free is a boon for some.