Bonus Bonds - The End! — The Happy Saver

Jan 22

Jan 22 Bonus Bonds - The End!

Ruth

Saving, Investment, Bonds

Jan 22, 2017

If you would prefer to listen to me read this blog post, please click on the play button.

If you have not read my previous post on Bonus Bonds you can find it here:

The Best Baby Shower Gift Ever

Every day I am thinking about how hard our money is working for us. The harder it works, the more it makes and the less WE have to work. There is absolutely no point in me putting money in places where it does not earn any interest (the exception is gold, which I got a little addicted to and now have a long wait for a return). Yes, of course I have some money in a ridiculously low interest everyday banking account with which I pay the groceries, plus a reasonable chunk for the unexpected “emergency” but the rest is diverted into other places pretty quickly. I can’t be having lazy money just laying around not earning its keep.

And that brings me to my Bonus Bonds. I enjoy these wee guys and each week I add $20 to the pot by way of an automatic payment and quietly it has been building. The financial advisor I have used actually laughed when I told him I had them. It is common knowledge that their returns are the same (or more likely lower) than a low interest bank account. Indeed the words “bonus bonds winning” and “chances of being hit by a bus” are often used in the same sentence. If I had have bought bonds that actually offered an interest payment (see last weeks post Bonds) I certainly would have been better off.

But here is why I have persisted:

I would like to win Division One Lotto (preferably with Powerball)
The odds of me doing this are 1 in 38,383,800
I am never going to win and I’m a fool to keep trying week after week, year after year.
Instead I spend my “Lotto Money” of $20 each week on Bonus Bonds
Every bond I buy is valid for every draw going forward where I could win a small prize or hopefully the top prize of $1,000,000.
So I get my gambling fix in a safe way.
When I don’t win, I get to keep my $20; unlike Lotto.

It is all about luck and I’m not an overly lucky person (unlike a certain father-in-law of mine who wins every raffle, chocolate wheel and meat raffle going. He can dump $2 in a one armed bandit and win. He even won three Christmas Hams last year. Three!).

I have been buying Bonus Bonds since mid 2014, meaning I’ve invested about $2,700 in total. Drip drip drip, week by week the balance rose. It has been an excellent way to siphon money into savings to stop me spending it. Each time the balance got up to about $1,000 I would take a chunk out (which is easy to do via their website) and invest it somewhere else before letting it rise again.

With the remaining chunk I would always cross my fingers and hope for a prize.

Sadly, that prize never came. Not even once.

I’ve had bigger chunks of $5,000 to $10,000 invested in the past and I’ve always won each month, but sadly, not this time folks. Sigh.

I am not alone. My husbands late sister had Bonus Bonds that had been completely forgotten about over the years. They were rediscovered and checked after what must have been 40 years. It was exciting when they were found again and the anticipation of a win was in the air. But she had won a grand total of NOTHING. What a let down. Which raises a question, how much money is lolling around with ANZ Bonus Bonds that will never be collected because people forget they have them? You might want to go check...

Here is the brochure that was found with her Bonus Bonds. Top prize $10,000! Woo hoo!

I still like Bonus Bonds and think that for a new saver they are an excellent way to make a start as they are a SIMPLE concept to understand. I also still think they make an excellent baby shower gift! They were one of the first things I tried when I started investing and it created a habit of regular saving and even though it was a very small weekly amount it certainly adds up over time. It is a really transparent way to save as well and logging onto my account I could always easily see exactly how many bonds I held and how few prizes I won! For someone saving towards a monetary goal, in my view, it is a good way to go about it.

But, I know a little more now and my confidence is up. It is not ideal to chop and change investments, but let us be honest, although they got me started in saving, they have provided a POOR investment return, so it is time to fix that now.

So, this week I almost closed the book on that chapter of saving. I say almost because I pulled out all but $100. I’ve stopped payments and will instead push those payments into an online savings account I have. But each month I still have 100 chances of winning, who knows my luck might change… I certainly hope so.

And to end I will be sure to keep in mind: