Which is the "better" investment? Littlewoods Pools, Premium Bonds or the National Lottery?

Answer 1

Premium Bonds, cos like everyone else says, you've still got your stake money if you want it back. Minimum block £100 - & you usually have to have loads for a chance to win.

Answer 2

Littelwoods and the Lottery are gambling NOT investing as you are betting your stake on a favourable outcome, if the result goes the wrong way then you lose all of your stake.

Premium Bonds could be considered an investment as you don't lose your original stake, although it will be eroded by inflation over time. The chances of you winning one of the big prizes depends on how much you put into Bonds, the maximum is £30,000.
The website below has some interesting statistics:

'On average you can expect to win a prize once a year with £2,400 invested. With £30,000 you can expect 15 prizes a year though most will be £50 and you may win fewer or none at all. Sixty one of the 100 £1 million winners had holdings up to July 2002 had £9,000 or more invested in Premium Bonds of which 28 had holdings of £19,000 or more'

Answer 3

They are all a gamble, including Premium bonds but the bonds are by far the best bet. The reason why premium bonds are a gamble is that you are actually gambling the fact that you will win and more than make up your losses incurred by inflation. i.e. You pay in £100 to the Premium Bonds and if you keep them for 10 years and win nothing, then you get £100 back, but £100 in 2016 will buy much less than £100 spent in 2006 so you have lost money. If you invest your money in a no risk high interest account in the building society, you get your £100 back, plus interest, plus its covered for inflation. The downside is you don't get a chance to win money in a luck of the draw gamble.
To win for sure, put your money in the building society, to lose some of your money, buy premium bonds, to lose a lot of money, buy a chance on the pools, to lose with even greater odds against you, the lottery.
Treat all the above as a gamble, not an investment. The odds are very much against you.

Answer 4

None of them are really investments.

With premium bonds, you're really betting the interest. Say you buy £2000 worth of bonds. You could have invested that money in a savings account at, say, 4% net, so you would have earned £80 in interest - that's really your "stake". The average return on premium bonds is about 3.25%, so you could expect instead to win £65 in a year. Therefore your return on your stake is 65/80 = 81.25%

With the lottery, the return on your stake is 50%.

With the pools, around 30% of stake money goes out in prizes.

So the premium bonds give the best return, but then again they require you to tie up more capital in the first place. If you've got that sort of sum, you'd be better off investing it in the stock market, where average returns are around inflation + 6% - or currently something like 8.5% before tax, or around 6.8% after it (basic rate - but note you would only pay this on dividends, not capital growth inside your capital gains allowance, so that's a cautious estimate).

So again working from your £2000 stake, you would get about £136/80 = 170% return on your stake in shares.

So, is it that poor people buy lottery tickets and rich people buy shares - or that people who buy lottery tickets become poorer and those who buy shares get richer?

Answer 5

These are not investments, pools and lottery are gambling, and premium bonds only return face value but at least you do get a small chance of winning a cash prize. Better to open a savings account in a building society.

Answer 6

Without a doubt it is Premium Bonds. It is a safe secure investment, that does have any risk attached to it. Whatever yuo pay for the bonds is held for you and is fully returned should you wish to sell.

Thrown into the deal is a monthly draw in which you could win considerable amounts of money. Consider this a bonus !! Effectively, although you pay up front, it is a free lottery !

Answer 7

Premium bonds. The other two are NOT an investment they are straight gambling.

Premium bonds you still have your money.... they do not keep the "stake".

My mum does the euro lotto, and has premium bonds... so far in the last 12 months, Nil winnings on Lotto, £50 last week on premium bonds. So... Thats half her £100 back, and she still has the £100 invested !!!!!

Answer 8

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Answer 9

Premium Bonds cos at the end of the day you still have what you put in. Whereas if you don't win on the lottery (which these days is highly likely) you'll loose the lot.

Answer 10

Premium Bonds are the only one of those you mention that IS an investment. The other two are just gambling, not investments.