If you are holding Premium Bonds, it is time for a rethink. Just as I predicted last week, NS&I say the prize rate fund will drop from April.
The article discusses the recent cut in the Premium Bonds prize rate from 4% to 3.8% by NS&I, along with changes to the prize distribution, including fewer large prizes and more smaller ones. Sylvia Morris advises savers to consider switching some Premium Bond holdings into a cash Isa for tax-free interest, as the rate is still competitive compared to other accounts. She also mentions other rate cuts, such as the Direct Saver dropping to 3.3% and Income Bonds to 3.26%, and notes that NS&I has raised the rate on its Direct Isa to 3.5% to encourage savers to use their £20,000 Isa allowance. Morris suggests transferring money from Direct Saver to Direct Isa for better returns, provided the Isa allowance has not been used.
