Lottery Bonds

Lottery bonds are a unique way of investing money. Basically its like a respectable lottery, however instead of buying tickets every week you invest money and depending on how much money you have put into the account you get a certain amount of tickets. Every month you keep you money into your account your ticket gets put into a draw. There is very little risk with lottery bonds as normally you can take out your money at any time. Lottery Bonds are often set up by governments.

An example of Lottery Bonds are Premium Bonds set-up by the UK government. They have 2 £1,000,000 jackpots that are won by members every month. There are also a million other prizes ranging from £500,000 and £50. The rate at which you are able to win with your investment is 1 in 24,000. The winners are picked at random by a machine once a month. One ticket costs £1 to with a minimum of £100 to be invested initially and you are able to invest a maximum of £30,000 in Premium bonds.

There is a Premium Bonds calculator available here which can analyse how much money you can win over time with your amount of investment. With this information you can compile the following information depending on how much money you invest.

Hold £100 over a year and the chance of winning anything is one-in-20.

Hold £1,000 over a year and 57% of people win nothing.

Hold £10,000 over a year and you have a 19% chance of winning £500 or more.

Above source form wikipedia.

Premium bonds are available to anybody even if you don't live in the UK. Currently there are 23 million investors in Premium Bonds and its been running since 1956.

For more information about buying premium bonds visit: National Savings and Investments