Flagstone vs. Premium Bonds – more bang for your buck?

During March 2023, households deposited £3.5 billion into premium bonds – an increase from £2bn in February – and the highest amount since September 2020.

As news spreads about the difficulties faced by banks, switching funds from many of the major names into areas such as premium bonds suggests savers are looking for more secure options than the High Street.

Of course, how you want to invest your cash and what you want it to achieve will influence where you place it. Premium bonds are safe, offer the chance of a huge tax-free payout, and deliver a fun aspect to money that banks can’t match.

On the other hand, investing your money in a cash deposit platform that offers a good rate of return may be less of a thrill, but will definitely help to grow your income – even without celebrities knocking on your door holding a fat novelty cheque.

So let’s take a closer look at what both options bring to the mix.  


Rates of return

According to This is Money, the rate of return on premium bonds is an average 3.3%, though as a random draw, it’s naturally not guaranteed. That said, to boost savers’ chances of winning, the last two years have seen the prizes ramp up.

Currently, there are two £1m prizes every month, a number of £100k, £50k prizes, and a whole range of lower amounts ranging from £25 to £25k. In April’s draw this year, 62 people won £100k, and 125 won £50k.

For those who win big, it’s well worth the investment, though like any lottery scenario, the odds aren’t in our favour. Even for those who invest the maximum amount, the chances of winning a life-changing or inflation-busting sum are slim.

With a £50k stake, the odds of winning the £1m prize are estimated at 1-in-1.2m. Winning £50k – doubling your money – is a far better bet, but still a distant 1-in-19,000. On average, the odds of winning anything for most people are 24,000 to 1 with a £1 bond. However, someone, somewhere, always wins – and as the cliché goes: “You’ve got to be in it to win it.”

For savers who prefer a safer bet, Flagstone is the UK’s largest cash deposit platform.

With hundreds of savings accounts available from up to 50+ banks – including market-leading and exclusive rates – our platform gives you a choice of instant access, notice and fixed-term accounts offering guaranteed rates of return.

At the time of writing, some sample rates include 4.91% for a fixed two years, 3.75% for notice, and 3.66% for instant access – almost five times higher than your typical High Street instant access account – capable of giving your interest income a tangible and sizeable boost.



Given how volatile the financial landscape has been recently, it’s no surprise that we all want to know our money is safe and sound.

Premium Bonds couldn’t be more secure. They’ve been around since 1956, boasting a 70-year heritage, and fully backed by the Treasury, so 100% of your investment is guaranteed to be looked after.

However, with an upper limit of £50k allowed when buying Premium Bonds, you might have extra cash sitting idle in other accounts. This could be earning you next to no interest, and anything over £85k is unprotected.

Flagstone’s platform has no upper limit, so you can deposit as much money with us as you want. Placing cash with Flagstone also gives you FSCS protection of £85k for each eligible savings account opened (£170k for joint accounts). And with the option to spread your money across as many as you choose, you can potentially protect every penny and reduce the impact of inflation.  



Buying premium bonds is easy. You can invest anything between £25 and £50k instantly, and when you want your money back, cash in your bonds at any time. It typically takes up to three working days before it appears in your account.

Opening a Flagstone account is just as simple. With just one application, you can access hundreds of accounts from dozens of banks, without the need to complete any more paperwork. Depending on the savings account(s), you choose, you can also move and withdraw your cash at any time to cover an emergency or match your changing goals.

In short, investing your cash in premium bonds is a fun way to save, offers a chance of a tax-free lump sum and is a secure way of investing anything up to £50k. However, it’s not suitable if you want guaranteed returns, a regular income, or want to jointly save with someone else.

And while Flagstone may not necessarily match premium bonds in the fun department (though it can be a buzz to watch your money grow), we lead the way in securing some of the best rates around, meaning you can nurture your cash for better results. Our secure platform means we’re also a very safe pair of hands.

To make your money work harder, join us today.



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