Pensioner Bonds explained

We explain what Pensioner Bonds are and what rates of interest you can expect

What are Pensioner Bonds?

Pensioner Bonds are special saving bonds designed for older people. George Osborne announced they would be introduced in the 2014 Budget.

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Who can get them?

Pensioner Bonds are available to all savers over 65.

How much can I save?

You can save up to £10,000 in a Pensioner Bond. Couples can have one apiece, so if you both take out the one-year and three-year you can have four in total.

There is a minimum deposit of £500.

What rate of interest will I get?

The one-year bond pays 2.8% (2.24% for a basic-rate taxpayer and 1.68% for a higher-rate one) and the three-year bond pays 4% (3.2% for a basic-rate taxpayer and 2.4% for a higher-rate one). These rates put them at the top of the best buy tables.

However, the interest will be paid on an annual basis rather than monthly, so they are no good for pensioners looking for a savings account which will boost their monthly income. This is because of the £10,000 savings cap, as the monthly income from a bond of that size would be relatively small at around £20 a month.

When and where can I get them?

Pensioner Bonds are available directly from NS&I online, over the phone and by post.

To apply over the phone, ring NS&I on 0500 500 000 for free. If you're on a mobile or outside the UK, call +44 1253 832007.

Alternatively, you can download a form, fill it out and send it to:

65+ Guaranteed Growth Bonds 
National Savings and Investments 
Glasgow 
G58 1AD

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What are the tax implications?

If you’re a taxpayer, then tax will be deducted at the basic rate (20%), with higher rate and additional rate taxpayers having to pay further tax at 20% and 25% respectively.

Non-taxpayers and those who have part of their interest taxed at 0% due to the changes in tax rules from April 2015 will have to claim the money back from HMRC.