From: "Andy Pandy" 
Newsgroups: uk.finance
Subject: Re: best way to invest 30k
Date: Tue, 6 Jun 2006 18:02:50 +0100


"tarquinlinbin"  wrote in message
news:h61b82131skn7gs61s2thhm6p3a4gujgf6@4ax.com...
> >>> But how much prize money per annum could you
> >>> *realistically* expect to receive if you invest the full 30k?
> >>
> >> About the same, if you are a high rate taxpayer:-
> >>
> >> Interest A/C:  30K x 5%pa  is  £900 after 40% tax.
> >>   .vs.
> >> Premium Bonds:  Say 12 x £50 and 3 x £100 = £900, tax-free.
> >> [15 prizes on average over year for £30K bonds.]
> >
> >
> >OK, so that's about 3% net. If you're *not* a higher rate taxpayer, and
> >would normally pay 20% tax on investment income, that grosses at 3.75%. I
> >would have thought you could do better than that in a building society.
> True but then you;d have no chance of winning a high value prize...

But the chance of winning a high value prize is miniscule with premium bonds. They
are skewed towards the lower end.

The chance of winning a big prize (£5000+) is 1 in 125 million per bond, and for the
jackpot it's 1 in 15 billion.

--
Andy