€25k invested in prize bonds

bilbot79 · 10-04-2021 9:48am

abff wrote: »

I don’t think anyone is suggesting prize bonds as a long term overall investment strategy. It’s a means of diversifying some of your assets into a low risk option and is also a suitable alternative to leaving money on deposit at current low interest rates, including short term savings that need to be kept fairly liquid.

I think you're probably right. I have 276k to put somewhere safe for about 9 months and I guess prize bonds may be the place. Just out of interest what other options are there bar a deposit account? Can't afford to lose anything and don't have time to wait out a dip

tuisginideach · 10-04-2021 9:50am

Investor12 wrote: »

People seem to be invested in prize bonds for well over 5 years and get dismal returns. Wouldn't you be far better served with equities? You can afford to wait out a stock market crash and recovery in that time frame.

If you read back over the c500 pages of posts here, you’ll see we have previously discussed this - ad nauseam

abff · 10-04-2021 10:57am

tuisginideach wrote: »

If you read back over the c500 pages of posts here, you’ll see we have previously discussed this - ad nauseam

I’m not sure that telling someone to read back over several hundred pages of posts is particularly helpful.

Demand deposit rates are close to zero at present. If you know that you won’t need the money for several months, you could look at a fixed term deposit, but you need to be prepared to tie your money up for at least a year if you want anything in excess of 0.1%. Post office savings accounts currently offer 0.05%. But this is not subject to DIRT (currently 33%) or PRSI.

If you have €276k to invest over 9 months, you would earn just over €100 in a post office savings account. The odds would favour you “winning” much more than this if you put the money into prize bonds.

Hibernicis · 10-04-2021 12:47pm

Investor12 wrote: »

People seem to be invested in prize bonds for well over 5 years and get dismal returns. Wouldn't you be far better served with equities?

As has been pointed out many times, these are bonds and the return is in line with what is to be expected from that asset class. Other asset classes (equities, property, dodgy oil exploration stocks, gold, bitcoin, tulips etc.) have different risk/return profiles. Prize Bonds have a guaranteed 100% capital repayment plus an average return better than anything the banks or other deposit products are offering on capital secure products at present. Bonds and Equities are complimentary, not alternatives and many people hold both.

Investor12 wrote: »

You can afford to wait out a stock market crash and recovery in that time frame.

That is not correct. Suppose the crash occurred a few weeks before you needed to draw down the capital ?

Hibernicis · 10-04-2021 12:48pm

Week eighteen.....

Winnings on 9th April €0
Last win: 4th December €50
Weeks since last win: 18

2017 (Jul-Dec) - €100k – 7x€50 = €350
2018 (Jan-Dec) - €200k – 12x€50 = €600
2019 (Jan-Dec) - €250k – 20x€50 = €1,000
2020 (Jan-Dec) - €252k - 24x€50 = €1,200
2021 (YTD) - €257k - 0x€0 = €0

Hibernicis · 10-04-2021 12:54pm

Atlantis50 wrote: »

I also have the online account now fully set up and new features include a banner notification alerting you you've won something if you log in after a win and also email notification of the win.

Starting to look like yet another Prize Bond company administration disaster. Sent three of these off over 3 weeks ago. First PIN received a week ago. Second one got a letter saying you have no state savings (completel rubbish). No sight or sign of the third PIN.

Taylor365 · 10-04-2021 1:16pm

Hibernicis wrote: »

Starting to look like yet another Prize Bond company administration disaster. Sent three of these off over 3 weeks ago. First PIN received a week ago. Second one got a letter saying you have no state savings (completel rubbish). No sight or sign of the third PIN.

Gov agencies at their best! :pac:

bilbot79 · 10-04-2021 1:35pm

abff wrote: »

I’m not sure that telling someone to read back over several hundred pages of posts is particularly helpful.

Demand deposit rates are close to zero at present. If you know that you won’t need the money for several months, you could look at a fixed term deposit, but you need to be prepared to tie your money up for at least a year if you want anything in excess of 0.1%. Post office savings accounts currently offer 0.05%. But this is not subject to DIRT (currently 33%) or PRSI.

If you have €276k to invest over 9 months, you would earn just over €100 in a post office savings account. The odds would favour you “winning” much more than this if you put the money into prize bonds.

Prize bonds it is then!!

Cute Hoor · 10-04-2021 2:46pm

Investor12 wrote: »

People seem to be invested in prize bonds for well over 5 years and get dismal returns. Wouldn't you be far better served with equities? You can afford to wait out a stock market crash and recovery in that time frame.

I presume you weren't thinking of PG&E (from $60 down to $11), Murphy Oil (from $31 down to $16), Devon Energy (from $36 down to $22), Apache (from $52 down to $17), Baker Hughes (from $46 down to $20), etc, etc, etc when you were thinking of how much better PB holders could have done by investing in equities in that 5 year timeframe.

RedRochey · 10-04-2021 3:22pm

I don't think anyone here is using Prize Bonds and expecting to make a good return, it's a safe substitute for cash

Easy to say you'd make more investing in equities but there's always a chance you'd have less in 5 years plus the emotional stress of it as well, I have a house deposit saved that I won't need for a few years but I know I wouldn't be able to handle the stress of seeing it fall 40/50%, I know it'll recover eventually but would still be a rough journey

Investor12 · 11-04-2021 9:45am

Hibernicis wrote: »

That is not correct. Suppose the crash occurred a few weeks before you needed to draw down the capital ?

5 years is often regarded as the minimum timeframe required to invest in equities.

Investor12 · 11-04-2021 9:48am

Cute Hoor wrote: »

I presume you weren't thinking of PG&E (from $60 down to $11), Murphy Oil (from $31 down to $16), Devon Energy (from $36 down to $22), Apache (from $52 down to $17), Baker Hughes (from $46 down to $20), etc, etc, etc when you were thinking of how much better PB holders could have done by investing in equities in that 5 year timeframe.

The performance of a single companies isn't an issue if you're diversified. Strange how Irish people regard the stock market as gambling. You don't see this attitude in other European countries. Maybe if more Irish people invested in equities there would be political pressure to reform the tax system. The global economy will always trend upwards in the long-term, barring a massive disaster that ends civilisation.

Investor12 · 11-04-2021 9:51am

Unless you're approaching retirement, then you should have little to no bonds in your portfolio. May as well hold cash considering the paltry returns.

dxhound2005 · 11-04-2021 9:57am

Investor12 wrote: »

The performance of a single companies isn't an issue if you're diversified. Strange how Irish people regard the stock market as gambling. You don't see this attitude in other European countries. Maybe if more Irish people invested in equities there would be political pressure to reform the tax system. The global economy will always trend upwards in the long-term, barring a massive disaster that ends civilisation.

Whenever I see the "only in Ireland" claim, I take a look at the evidence. Usually the claim is based on an idea in a person's head, rather than something which has been researched. This looks to be the case with your idea as well.

I did already know that German people do not use credit cards as much as we do, and that seems to be in line with their attitude to risky investments.

https://voxeu.org/article/cross-country-differences-risk-attitudes-towards-financial-investment

More interestingly, significant country differences arise. Institutional and cultural factors seem to have a substantial influence on the formation of individual risk-benefit perceptions associated with financial investment. Figure 2 suggests, for instance, that people living in the Netherlands, Austria, and Germany think that investments in shares, mutual funds, and bonds are on average extremely risky whilst their expected returns are very low. In contrast, those in the US, Turkey, UK, and Australia tend to have the exact opposite belief, that is, investing in financial assets can be highly beneficial, with a risk below the mean of all other countries.

HillCloudHop · 11-04-2021 11:37am

I'm almost 100% in equities. I'll never be able to retire early with bonds.

RedRochey · 11-04-2021 1:27pm

Investor12 wrote: »

Unless you're approaching retirement, then you should have little to no bonds in your portfolio. May as well hold cash considering the paltry returns.

Agree you shouldn't hold bonds unless you're near retirement but I think you're mixing up portfolio and savings, not all savings should be invested in a portfolio, could be a number of reasons why it would be better to hold cash/prize bonds, but agree if you don't need the money within 5 years then you're probably better off investing some portion into equities instead of bonds

Fair enough the returns on prize bonds are paltry to cash but at least you've the chance (albeit very small) to earn a little bit here and there, bit of fun as well

tuisginideach · 16-04-2021 12:33pm

tuisginideach wrote: »

And nothing again

And nothing again - 6 weeks on the trot at this stage

Furze99 · 16-04-2021 12:41pm

Hibernicis wrote: »

Week eighteen.....

Winnings on 9th April €0
Last win: 4th December €50
Weeks since last win: 18

2017 (Jul-Dec) - €100k – 7x€50 = €350
2018 (Jan-Dec) - €200k – 12x€50 = €600
2019 (Jan-Dec) - €250k – 20x€50 = €1,000
2020 (Jan-Dec) - €252k - 24x€50 = €1,200
2021 (YTD) - €257k - 0x€0 = €0

Same here - there's been a serious cutback in prizes. Government has obviously decided it doesn't want the use of the citizens cash anymore.

Bubbaclaus · 16-04-2021 12:49pm

Furze99 wrote: »

Same here - there's been a serious cutback in prizes. Government has obviously decided it doesn't want the use of the citizens cash anymore.

It would not be in the interest of the State and us as taxpayers to pay out a larger interest rate if we can borrow on the market for 0% or even negative interest rates.

pbwinner · 16-04-2021 1:14pm

Winnings on 16th April 2021: €0
Last win 18th December 2020: €100
Total winnings on €25k from Feb 2011 to date: €3150
2011: €75 x 4 = €300
2012: €75 x 6 = €450
2013: €50 x 12 = €600
2014: €50 x 9 = €450
2015: €50 x 5 = €250
2016: €50 x 5 = €250
2017: €50 x 4 = €200
2018: €50 x 2 = €100
2019: €50 x 6 = €300
2020: €50 x 5 = €250
2021: €0

PB2018 · 16-04-2021 1:18pm

Wins on 16th April 2021: €0
Last win: 18th December 2020: €50
Weeks since last win: 17
€134k invested in prize bonds since July 2017
Win ratio: 24 wins in 198 weeks (12%)
2017 (Jul-Dec): 5 x €50 = €250
2018 (Jan-Dec): 4 x €50 = €200
2019 (Jan-Dec): 5 x €50 = €250
2020 (Jan-Dec): 10 x €50 = €500
2021 (Jan-date): 0 x €50 = €0

Atlantis50 · 16-04-2021 1:39pm

Another €50 today on €60,100, making that 3 wins of €50 in the space of 4 weeks after a dry spell since the final purchase in October.

I think the approximate expected wins of €50 on that amount would be 3 - 4 per year so I'm about there already.

Furze99 · 16-04-2021 2:23pm

Bubbaclaus wrote: »

It would not be in the interest of the State and us as taxpayers to pay out a larger interest rate if we can borrow on the market for 0% or even negative interest rates.

No it wouldn't - but there may come a time when the government will be looking for citizens cash. There is a wee element of patriotism involved. And when that time comes, they may find that the citizens will not be so keen anymore.

carrickbawn · 16-04-2021 2:34pm

Nothing here again today.

adox · 16-04-2021 2:49pm

Yep nothing for me again either.

dxhound2005 · 16-04-2021 3:23pm

Furze99 wrote: »

No it wouldn't - but there may come a time when the government will be looking for citizens cash. There is a wee element of patriotism involved. And when that time comes, they may find that the citizens will not be so keen anymore.

Even if they reduce the prizes again the funds will still keep flowing in. Like they have in record amounts since the last two reductions in 2017 and 2021.

Because someone with €100K who wants to keep it safe for a year shouldn't be too concerned whether that stays at €100K. Or goes up to €100,100 if they put it on deposit, or €100,250 if they get average luck with Prize Bonds.

pbtracker · 16-04-2021 3:42pm

Another €0 for me. I did buy another €15K this week but would not be in this draw so hopefully might be lucky next week!

Winnings on 16th Apr 2021: €0
Last win : €50 5th Mar 2021
Investment : €77K (from Aug 2020)
Winnings Total : €250
Pre 2020 : €50
2020 : €150
2021 : €50

Hibernicis · 17-04-2021 10:52am

First win of 2021. At this point last year I had 8 x €50.

Winnings on 16th April €50
Last win: 4th December €50
Weeks since last win: 19

2017 (Jul-Dec) - €100k – 7x€50 = €350
2018 (Jan-Dec) - €200k – 12x€50 = €600
2019 (Jan-Dec) - €250k – 20x€50 = €1,000
2020 (Jan-Dec) - €252k - 24x€50 = €1,200
2021 (YTD) - €257k - 1x€50 = €50

Hibernicis · 17-04-2021 11:00am

Furze99 wrote: »

No it wouldn't - but there may come a time when the government will be looking for citizens cash. There is a wee element of patriotism involved. And when that time comes, they may find that the citizens will not be so keen anymore.

It's nothing to do with patriotism, it's an investment choice. Money is flowing into Prize Bonds at present because even in a win nothing scenario it's a better return than the negative interest rates which the banks are offering. If the government continue to offer 100% capital security and to pay a rate considerably higher than the banks deposit rates then the inflow will continue.

17-04-2021 11:02am

Hibernicis wrote: »

First win of 2021. At this point last year I had 8 x €50.

Winnings on 16th April €50
Last win: 4th December €50
Weeks since last win: 19

2017 (Jul-Dec) - €100k – 7x€50 = €350
2018 (Jan-Dec) - €200k – 12x€50 = €600
2019 (Jan-Dec) - €250k – 20x€50 = €1,000
2020 (Jan-Dec) - €252k - 24x€50 = €1,200
2021 (YTD) - €257k - 1x€50 = €50

Wow €257k?? Money is wasted on some people...

€25k invested in prize bonds

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