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Investing in UK premium bonds before brexit

  • 04-03-2019 10:33pm
    #1
    Registered Users Posts: 1,022 ✭✭✭ bfa1509


    I was looking into investing some of my savings into Irish prize bonds. From looking around online, and following the Prize bond thread here, it seems like a miserable, barren place to leave your money.

    I looked into UK premium bonds as an alternative. It appears that it is possible for irish people to buy them, although nobody seems to know the tax implications on winnings (or maybe someone could shed some light on this?)

    So this got me thinking, is this a boat worth jumping on before brexit happens? If the funds are guaranteed then whats the worst that could happen when brexit comes around?


Comments

  • Moderators, Business & Finance Moderators Posts: 7,823 Mod ✭✭✭✭ Jim2007


    bfa1509 wrote: »
    I was looking into investing some of my savings into Irish prize bonds. From looking around online, and following the Prize bond thread here, it seems like a miserable, barren place to leave your money.

    I looked into UK premium bonds as an alternative. It appears that it is possible for irish people to buy them, although nobody seems to know the tax implications on winnings (or maybe someone could shed some light on this?)

    So this got me thinking, is this a boat worth jumping on before brexit happens? If the funds are guaranteed then whats the worst that could happen when brexit comes around?

    So you don't know:
    - The tax situation
    - The FX risk
    - if the guarantee will still apply
    - You don't know if it will be legal to hold such investment products after BREXI
    - No idea what kind of customer protection will be in place

    Against a known situation in an attempt to increase your chance of 'winning' a return....

    Why not just put it on the dogs if you are willing to take all those other risks? Hell maybe even buy a dog for that matter...


  • Registered Users Posts: 1,022 ✭✭✭ bfa1509


    Jim2007 wrote: »
    So you don't know:
    - The tax situation
    - The FX risk
    - if the guarantee will still apply
    - You don't know if it will be legal to hold such investment products after BREXI
    - No idea what kind of customer protection will be in place

    Against a known situation in an attempt to increase your chance of 'winning' a return....

    Why not just put it on the dogs if you are willing to take all those other risks? Hell maybe even buy a dog for that matter...

    That's why I posted here; I have a month to figure this out and was hoping to hear from people who already hold bonds.

    I don't think the risks are as high as you think. If the bonds are guaranteed then they are hardly going to steal all your money without at least giving you warning to take them out. There are probably thousands of people living in ireland right now who hold Premium Bonds, the UK government are not going to risk a backlash.

    With a weakened sterling, a higher chance of return and maybe less UK citizens investing in bonds, this could be a golden opportunity before brexit closes the gap.

    I'll do some more research and post back here.


  • Registered Users Posts: 17,218 ✭✭✭✭ dxhound2005


    It doesn't matter how many people have bonds. The prize fund is 1.4% of the overall, so just as with Prize Bonds (0.5%) this determines how many prizes.

    https://www.moneysavingexpert.com/savings/premium-bonds/#tips-3

    You missed the boat with the exchange rate. I bought £300 a few weeks ago for just over €337. Today it would cost me €353. It might get better after Brexit, but nobody knows.

    I didn't check, but I would think you could get better than 1.4% in the UK with no risk deposit products.


  • Registered Users Posts: 1,022 ✭✭✭ bfa1509


    I bought £500 sterling a few weeks ago when it was at one of it's lowest points and also imported a car worth £18,000 last autumn, but I still feel like I missed the boat. Hopefully it will go down again in a few weeks.

    1.4% of the overall isn't a bad prize pool for that lottery. I'm just looking for somewhere better than irish prize bonds to keep my money while I figure out a wiser way of investing.


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