Pensioner bonds’ website struggles

Published: Thursday 15th January 2015 by The News Editor

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The website selling the Government’s new market-leading pensioner bonds has been struggling under the weight of demand from savers clamouring for better returns on their cash.

A pot of up to £10 billion has been put aside for the 65-plus bonds, which went on sale through the website of National Savings and Investments (NS&I) today.

But there were complaints of people struggling to access the site and get through on the phone as the stampede for the bonds got under way.

The deals, which have been released at a time when savers continue to be hammered by low interest rates, enable p eople aged over 65 years old to save up to £10,000 each in a one-year bond paying annual interest of 2.8% and a three-year bond paying a yearly rate of 4%.

Couples can jointly hold £40,000, assuming that each partner holds £10,000 in a one-year bond and £10,000 in a three-year bond.

NS&I said it expects the bonds to be available for a period of months, but some financial experts warned that the bonds “could be a case of blink and you’ll miss them,” predicting that they could all be snapped up within weeks or even days.

Martin Lewis, founder and editor of, pointed out that as few as half a million over-65s will be able to get their hands on the bonds if everyone uses their maximum allowance.

He said: ” My guess is this won’t be open for more than six to eight weeks, so go quick if you want it.”

The bonds are available by post as well as by phone and via NS&I’s website. NS&I has encouraged people to apply online as the “quickest and easiest” way to invest.

Some people vented their frustration at their struggle to get through to NS&I on the MoneySavingExpert website’s forum.

One user said: ” I just had the email from NS&I and the page link to apply is unavailable and the phone is continually busy.”

Another added: “This is a joke, have been trying both phone line and website since they were announced. Getting nowhere”

And another NS&I customer commented: “Have just tried to login to NSANDI account, got right through entering my number and name, the password page came up, entered the required digits. All fine but no ‘Next’ box to click. Frustrated as I cannot even see my other NSANDI products.”

Asked about the problems on the website, a spokeswoman for NS&I, which is backed by the Treasury, said: “We are aware of an issue affecting some customers.

“We are sorry for the inconvenience and grateful for people being patient.”

She said that as NS&I expects the bonds to be available for “months rather than weeks,” people should perhaps consider waiting for a more quiet and convenient time to apply.

NS&I has not given any figures for the level of sales so far. But research for Saga Personal Finance has found that more than one in three (34%) people aged over 65 were planning to invest in the bonds when they launched. The research among more than 1,300 people found that the average amount people plan to invest is £13,876.

The new bonds pay almost double the interest rates that can be found on bonds across the market generally, according to figures from website Moneyfacts.

The average one-year fixed bond on the market today pays just 1.43%, while the typical three-year bond pays 2.03%.

Sylvia Waycot, editor at, said: “This bond is going to be gone in days if not sooner. If you want the chance to get hold of one, then waste no time in applying.

“Disregard any notion of postal applications and don’t get stuck in a long phone queue as it really is a case of quickest gets the deal.”

Susan Hannums, director of savings website, said : “It’s interesting that NS&I believes that they may be available for months, rather than weeks, as given the level of interest we’ve received from our customers, we believe it could even be days.

“Our message to any savers wishing to take advantage is to act now to secure these fantastic rates, as it could be a case of blink and you’ll miss them.”

NS&I, which has more than 25 million customers, offers a range of cash savings and investment products, including premium bonds. It is backed by the Treasury, meaning any money invested in it has 100% security.

Generally, people who have money saved into a bank or building society in the UK are protected for up to £85,000 if their financial institution goes bust, under the Financial Services Compensation Scheme (FSCS).

Danny Cox, chartered financial planner at financial services firm Hargreaves Lansdown, said he would be “highly surprised” if the £10 billion pot lasts until the new tax year in April.

He said: ” Back in 2011, the popular NS&I index-linked certificates sold £5 billion in four months before being closed.”

The bonds are designed to be held for the whole term. Savers can cash them in early, although they will be hit by a penalty equivalent to 90 days’ interest on the amount cashed in.

Mr Lewis suggested that even if people only want to lock away their money for one year, they should consider opting for the three-year bond.

He said: “The most important thing to understand is if you are only going to do one bond, do the three-year that pays 4%, not the one-year that pays 2.8%.

“That’s because you only lose 90 days worth of interest if you withdraw early, therefore you can get the three-year bond, take your cash out after a year and you earn 3%, which beats the one-year bond.”

Published: Thursday 15th January 2015 by The News Editor

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