What does premium bond mean?
Definitions for premium bond
pre·mium bond
This dictionary definitions page includes all the possible meanings, example usage and translations of the word premium bond.
Princeton's WordNet
Premium Bondnoun
a government bond that bears no interest or capital gains but enters the holder into lotteries
Wiktionary
Premium Bondnoun
a method of financial investment available to UK citizens where, instead of interest payments, investors have the chance to win tax-free prizes, or get their money back.
Wikipedia
Premium Bond
A Premium Bond is a lottery bond issued by the United Kingdom government since 1956. At present it is issued by the government's National Savings and Investments agency. The principle behind Premium Bonds is that rather than the stake being gambled, as in a usual lottery, it is the interest on the bonds that is distributed by a lottery. The bonds are entered in a monthly prize draw and the government promises to buy them back, on request, for their original price. The government pays interest into the bond fund (2.20% per annum since October 2022) from which a monthly lottery distributes tax-free prizes to bondholders whose numbers are selected randomly. The machine that generates the numbers is called ERNIE, for Electronic Random Number Indicator Equipment. Prizes range from £25 to £1,000,000 and (since October 2022) the odds of a £1 bond winning a prize in a given month are 24,000 to 1.Investors can buy bonds at any time but they must be held for a whole calendar month before they qualify for a prize. As an example, a bond purchased mid-May must then be held throughout June before being eligible for the draw in July (and onwards). Bonds purchased by reinvestment of prizes are immediately eligible for the following month's draw. Numbers are entered in the draw each month, with an equal chance of winning, until the bond is cashed. As of 2019, each person may own bonds up to £50,000. Since 1 February 2019, the minimum purchase amount for Premium Bonds has been £25. As of October 2022 there are over 119 billion eligible Premium Bonds, each having a value of £1.When introduced to the wider public in 1957, the only other similar game available in the UK was the football pools, with the National Lottery not coming into existence until 1994. Although many avenues of lotteries and other forms of gambling are now available to British adults, Premium Bonds are held by more than 22 million people, equivalent to about 1 in 3 of the UK population.
ChatGPT
premium bond
A premium bond is a type of bond that is sold at a price higher than its face value or nominal value. This usually happens when the bond's stated interest rate is higher than the current market interest rates. This means that investors are willing to pay more for the bond due to its higher return. It is called a "premium" bond because investors pay a premium price to purchase it. In contrast, if a bond is sold at a price lower than its face value, it is called a discount bond.
Wikidata
Premium Bond
A Premium Bond is a lottery bond issued by the United Kingdom government's National Savings and Investments agency. The bonds are entered in a regular prize draw and the government promises to buy them back, on request, for their original price. The bonds were introduced by Harold Macmillan in his 1956 budget. The government pays interest on the bond. But instead of the interest being paid into individual accounts, it is paid into a prize fund from which a monthly lottery distributes tax-free prizes, or premiums, to those bond-holders whose numbers are selected randomly. The machine that generates random numbers for the lottery is called ERNIE, for Electronic Random Number Indicator Equipment. There are many different prizes ranging from £25 to the top prize of £1,000,000. Investors can purchase bonds at any time; bonds need to be held for a full calendar month after the month in which they are bought, e.g. purchase in January, eligible for March. Numbers are entered each month, with an equal chance of winning any prize, until the bond is cashed in.
Matched Categories
Anagrams for premium bond »
bond premium
Numerology
Chaldean Numerology
The numerical value of premium bond in Chaldean Numerology is: 3
Pythagorean Numerology
The numerical value of premium bond in Pythagorean Numerology is: 4
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