Premium Bonds vs the National Lottery –which is more likely to make you a millionaire?

How does having money in Premium Bonds compare to buying a ticket for the National Lottery? We investigate.

Premium bonds vs The National Lottery
(Image credit: Getty Images / Future PLC)

The chances of winning a million-pound prize are pretty slim. There’s the option of entering the television game show Who Wants To Be A Millionaire, government-backed Premium Bonds or the National Lottery.

You’re likely to have Premium Bonds from National Savings and Investments - they are the UK’s most popular savings account, with almost one in three of us saving money in them quietly hoping to win its million-pound jackpot. 

NS&I recently increased the odds of winning a prize - improving the odds of winning from 24,500 to 1 to 24,000 to 1 - and wonder how that compares to your chances of winning the National Lottery.

Premium Bonds vs the National Lottery - here we explain which is more likely to make you a millionaire.

Premium Bonds vs the National Lottery

Your chances of winning with Premium Bonds

Premium Bonds are accessible for everyone: you only need £25 to start saving in Premium Bonds while the maximum you can hold in them is £50,000.

Premium Bonds are backed by the Treasury too, and regulated by the FCA so that all your money is safe.

Your bonds are entered into a monthly prize draw and cash prizes range from £25 all the way up to an exciting £1m. It means there’s the chance you could win one or several of the following: £25, £50, £100, £500, £1,000, £5,000, £10,000, £25,000, £50,000, £100,000 or £1m.

If you win a prize you can have it transferred to your bank account to spend and enjoy - or reinvest and buy more bonds.

You have a one in 24,000 chance of winning the lowest prize of £25 each month for each £1 bond you hold.

  • The chance of winning £1m per £1 bond in one month is 1 in 59,562,773,505. 
  • The chance of winning £100,000 per £1 bond in one month is 1 in 5,956,312,828.
  • The chance of winning £50,000 per £1 bond in one month is 1 in 2,127,254,943.
  • The chance of winning £25,000 per £1 bond in one month is 1 in 938,001,831.

Deflated at these figures?  It’s not such a straightforward calculation because the chance of winning the top prize of £1m depends on how much you have in Premium Bonds. And you have to have at least £25 in premium Bonds. 

If you have £100 in Premium Bonds the chance of winning £1m is one in 49,563,028.

And if you have £1,000 in Premium Bonds it’s one is 4,954,991.

Meanwhile, if you save the maximum £50,000 in Premium Bonds, your chances of winning £1m is one in 96,839.

You also have a chance of winning several prizes of the same or different amounts in the same month - and the value of the total prize draw and the number of prizes awarded can change. 

For example, in October the odds of winning improved from 24,500 to 1 to 24,000 to 1. As a result, the number of £100,000 prizes went up from 10 to 18, while there are now 36 prizes worth £50,000 rather than the previous 19 - and there are over a million more £25 prizes to be won.

Or you could win nothing. There’s no guarantee you’ll win anything - ever. And for that reason, you may prefer to at least earn a set, guaranteed amount of interest from one of the best savings accounts.

If all else fails, Premium Bonds offer a bit of fun on the second working day of the month, when prizes are announced (unless there is a slight delay due to it being a bank holiday).

Your chances of winning with the National Lottery

Wall mounted sign for the National Lottery

(Image credit: Geography Photos / Getty images)

Again, the National Lottery is accessible for everyone: it only costs £2 to enter. However, unlike with Premium Bonds, where if you don’t win you still get to keep your money in your Premium Bonds and lose nothing, if you don’t win anything on the National Lottery you’ll lose your £2.

The National Lottery draws take place on Wednesday and Saturday evening at 7.45pm - that’s obviously more often than the monthly draw that Premium Bonds offer.

When no one wins, the money is rolled over resulting in huge jackpot prizes. This is the case for the upcoming draw on 2 November where a quadruple rollover jackpot is £12.7m (opens in new tab) much more impressive than £1m offered by Premium Bonds.

Tickets can be bought up to an hour before the draw happens, which is much more instant than with Premium Bonds.

National Lottery players need to choose six numbers from 1 up to 59 with the aim of matching at least two main numbers in order to win a prize. So the onus is on you to pick the right numbers.

You have a one in 45,000,000 chance of winning the top prize.

The verdict

Your chance of winning the jackpot on the National Lottery is one in 45 million in a week, significantly beating the 1 in more than 59 billion chance of winning £1m per £1 bond in a single month. 

Of course, you have to have the minimum £25 in Premium Bonds and the more bonds you have, the more chance you have of winning.

But your chance of winning the jackpot on the National Lottery (remember, one in 45 million in a week) is greater than if you have £100 in Premium Bonds (one in 49 million). Once you’ve got more than a few hundred pounds in Premium Bond, your chance of becoming a millionaire is much higher with premium bonds than the National Lottery. 

Plus you'll keep the money you deposit, unlike buying a lottery ticket. 

If you prefer certainty, a savings account is always the safest bet. Right now Nationwide offers 5% on balances up to £1,500 for the first 12 months of opening Nationwide FlexDirect Current Account (opens in new tab). That’s a guaranteed £75 if you put in the maximum amount for the entire year.

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Katie is staff writer at The Money Edit. She was the former staff writer at The Times and The Sunday Times. Her experience includes writing about personal finance, culture, travel and interviews celebrities.  Her investigative work on financial abuse resulted in a number of mortgage prisoners being set free - and a nomination for the Best Personal Finance Story of the Year in the Headlinemoney awards 2021.