Best savings accounts with a prize draw

NS&I Premium Bonds

• Odds: 1 in 22,000 for every £1 entry (January 2025)
• Minimum saving: £25
• Maximum saving: £50,000
• Maximum prize: £1 million

When it comes to savings products with prizes, NS&I’s Premium Bonds are the original and by far the nation’s favourite.

The idea is that for every £1 you hold of the bonds, you get an entry into a monthly prize draw in lieu of interest payments.

That interest is pooled into a prize fund, which is then used to pay the winners.

Each month there are over five million prizes ranging from £25 to £1 million, broken down into the following tiers:

• Higher value prize: £1 million; £100,000; £50,000; £25,000; £10,000; £5,000
• Medium value prize: £1,000; £500
• Low value prize: £100; £50; £25

The prizes are awarded tax free.

It’s also tax free to hold your money in Premium Bonds, which potentially makes it a quite tax-efficient way to save for those in higher tax brackets with lots of disposable income.

The minimum investment in Premium Bonds is £25 and you can hold up to £50,000 worth of bonds.

The odds vary each month but are around 1 in 22,000 as given by NS&I in January 2025.

If you’re happy with not receiving any interest payment – because, with average luck, the chances of winning are so low that you shouldn’t expect to win at all – Premium Bonds is an extremely safe way to save your money.

However, cashing out the bonds can take a few days so it’s not ideal if you think you might need the money instantly at some point in the future.

Read this: Premium Bonds: Are they worth it?

The Family Building Society Windfall Bond

• Odds: Variable
• Minimum saving: £10,000
• Maximum saving: £500,000
• Maximum prize: £50,000

The Family Building Society has the Windfall Bond, which is very similar to Premium Bonds.

It’s much smaller in size though, with a variable number of prizes each month ranging from £100 to £50,000.

They’re split across five levels, with prize values as below:

• Level A prize: £50,000
• Level B prize : £10,000
• Level C prize: £1,000
• Level D prize: £500
• Level E prize: £100

Unlike other savings products, you can only buy the Windfall Bond in £10,000 increments, and each £10,000 buys you one entry into the prize draw.

The size of the prize fund each month is 1% of the total value of eligible Windfall Bonds as recorded at the previous month’s prize draw, divided by 12 and rounded up to the nearest £100.

So for example, in January 2025, there were 17,502 qualifying Windfall Bond entries, which meant a total of £175,020,000 was invested.

Divide this by 100 and you’ll get the 1% figure: £1,750,200.

And then divide this again by 12 and you have £145,850 – or £145,900 when rounded up to the nearest £100 – and this is the size of the prize fund for February 2025.

The Family Building Society uses 60% of this prize fund for the biggest prize, 50% of the remaining money for the next prize and so on until the money has been distributed across all the tiers.

How the Windfall Bond is structured and therefore its odds of winning has changed over time.

Previously it gave an average odds of winning as 1 in 714.

These odds were held constant because they entered blank entries into the draw when there weren’t enough real entries.

But now it seems the odds of winning something has actually significantly improved.

For February 2025, there is a total of 209 prizes against 17,502 entries, which gives odds of about 1 in 83 – very good odds indeed in this sector.

Its other benefit is that it pays interest on top.

The downside of course is that it’s so popular, the Family Building Society rarely opens it for new subscriptions.

Also, you can’t withdraw the money – only close the account by giving a 35-day notice, so it’s not ideal for an emergency fund, unless for example you have a second household income that can tide you over in the short term.

Chip

• Odds: Variable
• Minimum saving: £100
• Maximum saving: £85,000
• Maximum prize: £10,000

Chip’s instant access Prize Savings Account* is relatively new to the market, and it’s changed a bit since its launch.

It sort of works like NS&I’s Premium Bonds.

Basically you have to deposit a minimum of £100 into the account and maintain this balance throughout the month.

For every £10 saved, you get one entry into the prize draw.

So the more money you save, the more entries you get, but no interest is paid on the balance.

Any money you deposit is protected by the Financial Services Compensation Scheme (FSCS), up to the usual cap of £85,000 – and this is the maximum you’re allowed to save in this account.

Each month, there’s one big prize of £10,000 plus 7,750 prizes worth £10.

The prizes have changed over time – I won £25 in the past, but those higher tiers have since been withdrawn.

The odds have also changed as the prizes have been restructured.

While previously the odds were 1 in 1,059 for every £10 entry, they now depend on the number of savers and will therefore vary every month.

Naturally, the odds goes down as the number of savers go up as the number of prizes stays the same.

If you do win, the money is shown as “prize” on your account – it doesn’t become money until you cash it out.

That means it doesn’t count as additional entries into the prize draw, nor is it protected by FSCS.

In other words, if you’re lucky enough to win, cash out that money as soon as possible.

Be careful when you withdraw the money though.

I found that months after withdrawing my prize, my account was showing I had withdrawn my original deposit rather than the prize, which meant I didn’t have enough money to qualify for future draws.

Read this: Chip Prize Savings Account review: I saved £100 and won £25

Halifax Savers Prize Draw

• Odds: variable
• Minimum saving: £5,000
• Maximum saving: depends on account
• Maximum prize: £100,000

One of the longest running prize draws for savers offered by a high street bank comes from Halifax, and it’s open to those who save with Halifax and the Bank of Scotland (they’re in the same banking group).

There are 1,603 prizes each month with values of between £100 and £100,000.

The odds are not released, and varies from month to month depending on how many people qualify for the draw; the prize fund is set at £550,000 regardless of this number.

This prize draw savings account is for those who already have a fair bit of money tucked away as you need at least £5,000 to qualify for entry.

On the plus side, that £5,000 can be split across more than one savings product, including cash ISAs, so you can mix it up between instant access accounts and notice accounts.