MARTIN Lewis' Money Saving Expert has issued a fresh warning to National Savings and Investments Premium Bonds holders.
NS&I is making another cut to the Premium Bond prize fund rate, reducing it to 4%.
The Premium Bond rate is currently 4.4%. Last month, NS&I said it would cut the rate to 4.15% in the December draw. Now, the rate will fall again to 4% from January.
The announcement will come as a blow to millions of savers.
I'm thinking of buying a PREMIUM BOND. Not really sure what they are, how many you get or how it works but I like the WW2 era sound of them. Do you have some? Have you won owt?#PremiumBonds
— Andy Bush (@bushontheradio) November 25, 2024
According to MoneyWeek, Andrew Westhead, NS&I retail director, explained: "We carefully review our savings rates in response to changes in the broader market.
"These adjustments help us meet our Net Financing target while balancing the interests of our savers, taxpayers, and the wider financial services sector."
MSE, which was founded by ITV and BBC star Lewis, said: "This rate was already lagging behind interest rates on standard savings accounts – so if you're a bondholder, you may want to consider moving your cash to an interest-paying account."
Despite the rate changes, NS&I assured savers that Premium Bonds remain a popular choice, backed by the 100% Government guarantee.
The January 2025 draw is set to deliver over 5.8 million tax-free prizes worth more than £431million.
The odds of winning will remain the same at 22,000 to 1, and there will continue to be two £1 million jackpots.
However, the number of other Premium Bond prizes will fall. For example, there are currently 89 £100,000 prizes up for grabs each month, but from January there will only be 82.
