The prize fund rate for Premium Bonds is soon to fall
Martin Lewis has issued a warning for Premium Bonds holders, explaining that "most people would earn more" by exploring different saving options. Speaking on ITV, the Money Saving Expert founder responded to a question from someone wanting to know how to buy Premium Bonds.
Premium Bonds are entered into a monthly prize draw instead of accruing value through an interest rate. Customers have had cause to question if their Bonds are worth it, as the prize fund rate is set to decrease from the December draw, falling from the current 4.4 percent to 4.15 percent. The financial expert also warned those with modest savings that they may get on better with another savings account. He stated: "If you're saving a couple of grand, the interest rate is currently 4.4 percent dropping to 4.15 percent in December, but with average luck you actually earn less than the interest rate that is published, because that's called the prize rate.
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