Exchanging interest for tax-free prize shots
At Mars Money Lab, I’m testing unconventional passive income ideas, and NS&I Premium Bonds are a wild card. Instead of earning interest, my money goes into a monthly prize draw – think £25 to £1 million, all tax-free, backed by HM Treasury. It’s a low-risk gamble that’s more fun than a savings account, and I’ve been seeing how it stacks up.
My NS&I Experiment
I’ve saved over £1,600 in NS&I Premium Bonds since April 2024, chasing those prize draws. After a long dry spell, I finally scored £100 in September 2025 – total prizes £100 so far. The odds are ~21,000 to 1 per £1 bond, and while I haven’t hit the £1 million jackpot (yet!), my cash stays safe, ready to cash out anytime. Wins or not, it’s a steady experiment with zero risk to my initial investment.
How It Works
– Sign Up: Buy bonds at NS&I – £25 minimum, £50,000 max. Available in the UK only.
– Wait: Bonds enter the draw after one full month (e.g., buy Feb, draw Apr).
– Win: Prizes from £25 to £1M hit your account if luck’s on your side.
– Cash out: Withdraw anytime, no penalties – 100% safe.
Safety / Risk Rating
NS&I Premium Bonds: ★★★★★ (Extremely safe)
UK government-backed investment with full capital protection – your money is 100% secure, guaranteed by HM Treasury. Returns come from tax-free prize draws rather than interest, so no market risk or loss of principal.
Perfect for risk-averse savers wanting lottery-style excitement with zero chance of losing money.
Pros and Cons
– Pros: Risk-free (government-backed), tax-free prizes, fun factor.
– Cons: No guaranteed return, winnings vary (could be £0).
Try It Yourself
Head to NS&I to grab some Premium Bonds – no referral link here, just my MarsBlock-tested nudge. A fun little income experiment – park your money and see if ERNIE (the prize bot) picks you!
Latest Updates
For the latest info and numbers, check here: Experiments-dashboard
Big win at Mars Money Lab! My NS&I Premium Bonds experiment scored £100 in the September 2025 draw, my first prize! I’m adding £50 monthly and chasing more. Follow me on X @MarsMoneyLab or check my post below for updates: graphs, numbers, no fluff! 🚀
*Disclaimer: I’m not a financial adviser. NS&I Premium Bonds offer prizes, not interest – returns aren’t guaranteed, so weigh the odds. This is my personal experiment.*