Two lucky premium bond winners have become millionaires overnight in the latest NS&I prize draw. The lure of winning a life-changing sum of money has made premium bonds the nation's favourite savings account - but is it worth buying them for your children or grandchildren?
Recent changes to NS&I's gifting rules means there's been a surge of children entering the running for the coveted £1m prize. But you may want to think twice before diving in. Which? analysis has found under-16s have some of the worst luck.
Since September 2009, just five children have landed the million-pound jackpot, with the youngest being only three at the time of winning.
Here, we reveal the winners of the September 2019 premium bonds prize draw and take a closer look at which age group has been the luckiest over the past decade.
This month, the two £1m jackpots were won by bondholders in Surrey and Hertfordshire.
Both this month's winners are big savers, with more money invested into premium bonds than any previous jackpot winner from their areas.
The Surrey £1m winner had £41,595 invested and purchased his winning bond (319ML537267) in January 2018.
The second winner from Hertfordshire had the maximum £50,000 invested and bought his winning bond (350AS143074) in January 2019.
While you might not have secured the £1m jackpot, NS&I also awarded more than 3.37m other prizes this month, worth a staggering £96bn.
In the September prize draw, NS&I gave out six prizes worth £100,000, as well as 11 worth £50,000 and 22 worth £25,000. To find out if you've won, you can check via the NS&I website or on its app. We've listed the high-value prize winner below:
Around 261,000 people aged 16 or under were given premium bonds between August 2018 and June 2019, an increase of almost 60%.
This rise in gifting the potential prize-winning bonds could be partly due to rule changes over the past year.
Since August 2018, NS&I has allowed grandparents to buy premium bonds as gifts online, not just via post, making it a much easier process.
NS&I also cut the minimum investment from £100 to £25 in February 2019, so that bonds are now a more budget-friendly option for families.
The number of children entering the draw is likely to surge even further after NS&I changed the rules on who can buy premium bonds as gifts.
Previously, to buy premium bonds in a child's name, you needed to be the parent, guardian or grandparent.
Premium bonds can be bought as gifts by all adults via post or online and parents also have the option to buy over the phone or to transfer from another NS&I account in the child's name.
No matter who buys the bonds, the investment will be managed by the child's parent or guardian until they turn 16.
The minimum amount of premium bonds you can buy is £25, and the maximum is £50,000.
There have been 181 premium jackpot winners over the past decade, five of whom were under the age of 16.
The ages of the children who took home winnings were three, nine, 11, 12 and 13.
Savers under 16 have an average of £1,540 invested and are the third least likely age group to win the jackpot.
Premium bond holders aged 16 to 19 were the least likely group to win the £1m prize, with only one person in the age range winning the jackpot over the past 10 years, even though on average this group had slightly more invested at £1,835.
The luckiest age group over the past 10 years were in the 60 to 69 age band. This group generated 54 jackpot winners, but the average amount invested was much higher at £11,414.
The table below shows the number of premium bond jackpot winners from each age group from September 2009 to August 2019.
|Age band (years)||No. jackpot winners||Average premium bond value|
|0 - 15||5||£1,540|
|16 - 19||1||£1,835|
|20 - 29||3||£2,430|
|30 - 39||6||£2,253|
|40 - 49||14||£3,128|
|50 - 59||28||£6,322|
|60 - 69||54||£11,414|
If you buy premium bonds for a child, you or a nominated parent or guardian will be responsible for the bonds until the child's 16th birthday, when responsibility is handed over to them.
If a child under the age of 16 wins a premium bonds prize, the nominated parent or guardian will be in charge of the bonds and make a decision about what to do with the money.
Currently, there are 147,179 unclaimed prizes held for children under 16 at the time of winning a prize.
The highest-value prizes left unclaimed at the time of winning include two £10,000 prizes, one of which belongs to someone who is still under 16, and two £5,000 cash prizes, including one winner who is still also a child.
The table below shows the details of the highest-value unclaimed prizes for under-16s.
|Prize value||Prize draw time||Current holding value||Winning bond number||Gender||Age at prize||Age now|
Overall there are 76,317 prizes that have gone unclaimed for winners who are still under 16. The table below shows a full breakdown of the number of unclaimed prizes for children at each prize value.
|Prize value||No. unclaimed prizes|
Premium bonds are one way of setting up a nest egg for your children. If they win big, they could end up with a neat sum that could set them up for life.
One thing to bear in mind with premium bonds is that your child won't earn regular interest on their savings. Instead, each month the bonds will be entered in a prize draw, with each £1 having an equal chance of winning.
NS&I estimates that the average person could earn a return of 1.4% over a year. This isn't guaranteed, however, and while a lucky few could win more, the majority of savers will win less or nothing at all in some cases.
If your child's savings aren't earning interest that keeps up with the rate of inflation, the pot could end up losing value in real terms.
The Nationwide Future Saver, for example, can be opened for children aged up to 15.
It pays 3% AER if you have another Nationwide account. Otherwise, it pays 2% AER. The interest compounds each year, meaning you earn interest on the interest itself, as well as the money you've paid in.
HSBC offers a My Savings account for children aged 7 to 17, which also pays 3% AER for sums up to £3,000. Balances over this amount will earn interest of 0.75%.
Parents and legal guardians can open Junior Isas for their children and anyone can pay into one.
With a Junior Isa, all the money is in the child's name and you cannot withdraw it. You can, however, transfer it between Isa providers. The child will gain access to it when they turn 18.
Currently, Coventry Building Society offers the best interest rate, paying 3.6% AER. If you'd like to stick with NS&I for your savings, though, it offers a Junior Isa that pays 3.25%.