Two £1m top prizes will be awarded in the monthly Premium Bond draw starting in August, National Savings & Investments has announced.
The executive agency says this is the biggest change to its payout rules since Premium Bond draws were established in the mid-1950s.
August’s total prize fund is set at £72m, NS&I says, which means two £1m top prizes, plus “one million” other tax-free prizes.
Investors should also benefit from an increase in the payout rate to 3.25% from 3.20%, starting from the same draw – equivalent to 5.25% for a top rate taxpayer, or 4.06% for a basic rate payer. NS&I says it is able to fund the greater prize payouts because of the surge in money that has come its way in the past half decade.
More money has been invested in the past six years than in the previous 42, reflecting the effects of the worst bear market since the mid-1970s and investor propensity to seek out other types of assets than shares in listed companies.
In the decade since a £1m top prize was introduced in 1994, the total amount invested in Premium Bonds has shot up from £4bn to £26bn, NS&I says.
The maximum allowable investment remains £30,000 per person, with the current minimum at £100.
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