National Savings and Investments (NS&I) has issued a reminder to Premium Bonds holders about a three-month security rule that could cause them to miss out on prizes. Customers are urged to check their account settings to ensure they receive any winnings.
How the Rule Works
When opening a Premium Bond account, savers can specify how they want prizes paid, typically by bank account. Payments are usually made around the seventh working day of the month. If funds haven't cleared, it's advisable to contact NS&I to confirm payment details.
However, for those who receive prizes by cheque, the cheques expire after three months for security reasons. Finance expert Rachel Springall from Moneyfactscompare.co.uk explained: "If you get your payments by cheque, be sure to cash them in as they expire after three months. These can be replaced, so just give NS&I a call to get a new one issued."
Prize Fund Adjustments
Ms Springall noted that the NS&I prize fund typically follows interest rate trends. She said: "It's a bit hard to tell with the prolonged unrest in the Middle East and its impact on future rate setting and inflationary pressures. In the past, the prize fund has been dropped when interest rates have reduced, and increased several times when rates have moved upwards."
Savings Advice
For those looking to build savings habits, Ms Springall recommended considering a regular savings account, with top deals offering up to 7 per cent. For emergency funds, an easy access account paying over 4 per cent is wise, along with an ISA to protect savings from tax. Fixed rate bonds or ISAs are ideal for lump sums, aiming for rates over 4.50 per cent.
"One account that does tend to get overlooked is a notice account or ISA," she added. "The best pay rates above 4 per cent but require savers to give notice to access their cash, great for careful planning."
Ms Springall also highlighted the rise of challenger banks, which offer brilliant uplifts for the savings market but may have eligibility criteria or withdrawal restrictions. She stressed the importance of checking terms and conditions carefully to avoid disappointment.
