Premium Bond savers could be forced to wait over three years for a win, new analysis has revealed. are a type ofrun by NS&I - but instead of earning interest and getting a guaranteed return on your money, you're entered into a prize draw each month. The prizes range from £25 to £1million.

Around 22.7 million people hold bonds, making them one of the UK’s most popular savings products. At the end of 2024, around £127.7billion was in Premium Bonds accounts.

You get a unique bond number for every £1 invested, and you can from £25 up to £50,000 in total. The overall theory is that the more Premium Bonds you own, the more unique numbers you have entered into the draw - so the more chance of winning.

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According to the NS&I, each £1 bond has a 22,000-to-one shot of winning anything, and on average returns are 3.8% a year at the present prize rate. However, nothing is guaranteed.

Information which has come to light through a Freedom of Information (FOI) request from the wealth management firm Octopus Money, found that nearly 440,000 holders won a prize for the first time last year after holding Premium Bonds for around three and a half years on average.

This is a contrast to the beliefs of holders, with over a third of 678 surveyed by Octopus Money saying they expected a prize within the first six months.

The reason for the long wait is likely due to people only holding a small amount of Premium Bonds. On a £25 to £100 investment, the return of 3.8% would give you nothing so a return of 0% - or a return of 25% if you won the minimum prize on a £100 investment.

For it to average out to 3.8% across all savers, many bonds have to win nothing to pay for every £25 prize.

When you factor in the larger prizes - including two of £1 million each month - most bonds will have to win nothing to keep the prize rate down at 3.8%.

For example, last month, the NS&I handed out 5.9 million prizes to Bond holders. This means 131.39 billion bonds - or 99.995% of them - won absolutely nothing.

Around 5% of Premium Bond holders - so around 123million - hold the maximum amount of £50,000. As they hold the most, they have the greatest chance of bagging a prize, and collectively they hold 49.7% of all the money in the draw.

In the past five years, 94% of Premium Bond jackpot winners held over £10,000, while three quarters held over £25,000. Both savers who won the £1million jackpot in this month’s draw held the maximum £50,000.

For those who do eventually win, the prize amount is often modest. In 2024, 88% of Premium Bond prize winners took home less than £2,000 and just 0.32% of all winners won more than £10,000.

Octopus Money says that over £4.25billion has been held in Premium Bond accounts that have had no activity in the past decade - earning zero interest which has eroded the individual wealth of the Bond holder. =

Ruth Handcock, CEO of Octopus Money commented: “While products like Premium Bonds may work well for some, others are missing out on strategies that could grow their wealth and deliver stronger returns over time. Premium Bonds are unlikely to outpace inflation, so your money may seem 'safe' but it’s quietly shrinking in value over time.

"The truth is that millions of people could be getting more from their money, but they need access to affordable, personalised advice to help them figure out what’s right for them - something that only 9% of people in the UK currently receive.

"Without it, they stick with what feels familiar or they’re left in financial limbo, unsure how to first step."

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