It's often said that you should only gamble with money you can afford to lose. And one of the best ways to get hold of such money is by saving it out of your normal spending.
The Money Saving Expert website (www.moneysavingexpert.com) aims to help you do exactly that. It’s run by financial journalist and TV presenter Martin Lewis. The site is packed with hints and tips on saving money (and sometimes making it too), on everything from mobile phones to credit cards.
Among the many interesting features is an article about saving money on motoring. This has a link to a website (www.petrolprices.com) which will show you the cheapest petrol station in your area. Another site mentioned (www.pipelinecard.org) is currently collecting the names of people who would like a free discount card entitling them to a discount of up to 10p a litre on petrol with a major retailer.
From the website you can also subscribe to Martin Lewis’s free weekly e-mail newsletter, which includes information on special offers and ‘loopholes’ you can take advantage of to save or make money. A recent one included a promotion for a Barclays Bank current account which (unintentionally) gave away £100 just for opening an account, putting £2,000 into it, and closing it two months later.
If you regularly follow all the tips and advice on this website, I reckon you should be able to save several hundred pounds a year (at least) for betting purposes!
Tuesday, January 31, 2006
Thursday, January 26, 2006
Lazybet Update
The Lazybet Placepot Syndicate hasn't been overly successful, and each £10 of members' money originally invested is now worth under £8. In view of this Lazybet have decided to broaden the scope of the syndicate. Here's what they say on the site today:
I think this is a sensible step, and will be keeping my current investment in the syndicate. Lazybet has tipped a number of good winners over the last few weeks, so allowing single bets as well seems a sensible step to take. I do take my hat off to the people behind Lazybet for putting in a lot of effort for small financial reward. Successful or not, they really are putting their money where their mouth is...
After considering members’ feedback and our own thoughts over the past few days, we’ve decided to convert the Placepot syndicate into a general sports betting syndicate. We will still take a look at the Placepot prospects each day and have a go if we think the dividend might be worth it but the new structure will give us much wider scope in selecting bets.
I think this is a sensible step, and will be keeping my current investment in the syndicate. Lazybet has tipped a number of good winners over the last few weeks, so allowing single bets as well seems a sensible step to take. I do take my hat off to the people behind Lazybet for putting in a lot of effort for small financial reward. Successful or not, they really are putting their money where their mouth is...
Friday, January 20, 2006
Euro-Millions Jackpot
Here's an item I saw on the BBC website:
OK, but bear in mind that the odds against winning are 76 million to 1!
Theoretically, when the prize fund is this big, the odds are actually in punters' favour - if you entered an infinite number of times you would come out ahead overall. However, most of us don't have infinite lifespans, and it's unlikely the Lottery will either!
Sales soar ahead of £85m lottery
The biggest ever British lottery win could take place later on Friday with an estimated jackpot of £85m up for grabs in the EuroMillions draw.
The draw, run by the National Lottery in conjunction with operators in eight European countries, has not seen a winner for the past nine weeks.
Ticket sales are on course to be more than 300% higher than normal, the UK organiser Camelot has said.
http://news.bbc.co.uk/1/hi/uk/4630686.stm
OK, but bear in mind that the odds against winning are 76 million to 1!
Theoretically, when the prize fund is this big, the odds are actually in punters' favour - if you entered an infinite number of times you would come out ahead overall. However, most of us don't have infinite lifespans, and it's unlikely the Lottery will either!
Wednesday, January 18, 2006
Calculating winnings on multiple bets
Many people have difficulties calculating the expected returns from winning multiple bets such as doubles, trebles and four-folds. However, it is important to know how much you should be getting, as bookmakers can and do make mistakes. Here's a quick and simple way to calculate the returns due on any accumulator bet from a double upwards.
If you are using fractional odds, first divide out the odds of each ‘leg’ of the bet to produce a single figure in decimals. Add one point to each of these figures, multiply through, then multiply by your stake.
For example, suppose you are lucky enough to have a winning four-fold at 2/1, 10/11, 9/2 and 6/4. Convert these odds to decimals and add one point in each case:
2/1 = 2 divided by 1 = 2.00, plus 1 = 3.00
10/11 = 10 divided by 11 = 0.90, plus 1 = 1.90
9/2 = 9 divided by 2 = 4.50, plus 1 = 5.50
6/4 = 6 divided by 4 = 1.50, plus 1 = 2.50
Now multiply the decimals together: 3 x 1.9 x 5.5 x 2.5 = 78.38. If you had staked £1, the total return would therefore be £78.38. If you had staked £5, your return would be £391.90 (5 x 78.38).
If you are working with decimal odds, of course, as used on Betfair, it is even easier. Just multiply all the decimal prices together as shown above, and multiply this by your stake money.
If you are using fractional odds, first divide out the odds of each ‘leg’ of the bet to produce a single figure in decimals. Add one point to each of these figures, multiply through, then multiply by your stake.
For example, suppose you are lucky enough to have a winning four-fold at 2/1, 10/11, 9/2 and 6/4. Convert these odds to decimals and add one point in each case:
2/1 = 2 divided by 1 = 2.00, plus 1 = 3.00
10/11 = 10 divided by 11 = 0.90, plus 1 = 1.90
9/2 = 9 divided by 2 = 4.50, plus 1 = 5.50
6/4 = 6 divided by 4 = 1.50, plus 1 = 2.50
Now multiply the decimals together: 3 x 1.9 x 5.5 x 2.5 = 78.38. If you had staked £1, the total return would therefore be £78.38. If you had staked £5, your return would be £391.90 (5 x 78.38).
If you are working with decimal odds, of course, as used on Betfair, it is even easier. Just multiply all the decimal prices together as shown above, and multiply this by your stake money.
Wednesday, January 11, 2006
Premium Bonds v. The Lottery
Premium Bonds have been in the news again recently, with the decision to pay out an extra £1 million prize every month. But are they really a good bet compared with other opportunities to win big cash prizes such as the Lottery? I thought I'd do some research on this to find out.
Let's start with the basics though. Premium Bonds are sold by National Savings and Investments (NS&I) on behalf of the government. Each Bond has a unique number and is sold for £1, though the minimum purchase you can make at any one time is £100.
No interest is paid on Premium Bonds. Instead, the interest generated is put into a prize fund. Every month the NS&I computer, the famous ERNIE, selects the winning numbers, whose owners receive prizes ranging from the minimum £50 up to £1 million. Each month over a million prizes in total are awarded.
So how do Premium Bonds compare with the Lottery? One big 'plus' for Bonds is that, once you have bought them, they are entered into the prize draws month after month, for as long as you hold them. You can also get your money back at any time - unlike Lottery tickets which, if they don't win, are instantly worthless. And, unlike stocks and shares, the value of Premium Bonds cannot go down, though of course it will never go up either.
Does the Lottery have any advantages? Well, maybe. One is that the top prize is usually bigger. If you wouldn't get out bed for a mere million pounds but wouldn't sniff at ten million, the Lottery might appeal more. Just don't hold your breath waiting for it to happen…
In addition, your chances of winning any prize with a single Lottery ticket (1 in 54) are much better than with a Premium Bond (1 in 24,000 in each draw). However, the minimum prizes with Lottery tickets are smaller - and your Premium Bond will be in entered in twelve draws a year for as long as you hold it.
Perhaps the best way of comparing the relative attractions of the Lottery and Premium Bonds is comparing the likely return on them from the same level of investment. Suppose then that you have a £30,000 windfall and invest it on (a) Premium Bonds and (b) the Lottery. What are your returns likely to be?
As from August 2005, the interest rate on Premium Bonds rose to 3.25 per cent per year. This has led some commentators to suggest that with average luck you could expect a return of 3.25 per cent on your investment. As prizes are tax-free, this would be the equivalent of 5.42 per cent for a higher rate tax-payer and 4.06 per cent for a basic rate one. Such rates would be comparable with many high street savings accounts.
I have to say this is misleading, though. That average figure of 3.25 per cent is boosted by a small number of very large prizes that, statistically, you are very unlikely to win. A more relevant statistic may be the fact that with £30,000 worth of bonds you can expect to win, on average, 15 prizes a year.
If these are all minimum £50 prizes, at the end of the year you will have won £750 worth of prizes, equivalent to an annual interest rate of 2.5 per cent tax-free. That's less than many savings accounts, of course, but every month you do have the chance of winning a bigger prize, up to the £1 million jackpot.
Now suppose that instead you invest your £30,000 on this week's Lottery draw. The statistics say that 50 per cent of all funds invested in the Lottery are returned as prizes. Again this is misleading, however, as a significant proportion of this money goes in a small number of very large prizes you are very unlikely to win.
A better guide comes from a surprising source. ITV's Saturday night quiz show The Big Call culminates in the winner being asked to choose between £25,000 and 100,000 Lottery tickets. If the winner doesn't go for the tickets, a viewer gets the opportunity instead. If you have watched the show, you will know that the 100,000 Lottery tickets typically produce around £30,000 in prizes, i.e. you get a return of 30 per cent.
Going back to my example, then, if you put your £30,000 windfall into Lottery tickets, with 'average luck' you could expect to get 30 per cent of 30,000 = £9,000 back. By contrast, with average luck again your £30,000 Premium Bond investment would give you a total return over a year of £30,750 (including the value of the Bonds, of course).
When you look at it like this, the Lottery really is a terrible investment. OK, it might be a bit of fun if you have no other use for a spare pound or two, but if you are spending any more than this, you should really consider saving up and buying Premium Bonds instead.
After all, think about it. With Premium Bonds you still get the chance to win a life-changing sum of money, but even if this doesn't happen they are still a decent investment, and you can get all your money back any time you need it.
If you're paying for Lottery tickets every week, therefore, my suggestion would be to put the money into a separate kitty instead and use it to buy Premium Bonds. The more you have, the better your chances will be, and every month your Bonds will be in with as good a chance of a big win as anybody else's. Be lucky!
* You can buy Premium Bonds at any post office or at the NS&I website at www.nsandi.com. If you already have Premium Bonds, you can also use this site to check whether they are holding any unclaimed prizes for you.
Let's start with the basics though. Premium Bonds are sold by National Savings and Investments (NS&I) on behalf of the government. Each Bond has a unique number and is sold for £1, though the minimum purchase you can make at any one time is £100.
No interest is paid on Premium Bonds. Instead, the interest generated is put into a prize fund. Every month the NS&I computer, the famous ERNIE, selects the winning numbers, whose owners receive prizes ranging from the minimum £50 up to £1 million. Each month over a million prizes in total are awarded.
So how do Premium Bonds compare with the Lottery? One big 'plus' for Bonds is that, once you have bought them, they are entered into the prize draws month after month, for as long as you hold them. You can also get your money back at any time - unlike Lottery tickets which, if they don't win, are instantly worthless. And, unlike stocks and shares, the value of Premium Bonds cannot go down, though of course it will never go up either.
Does the Lottery have any advantages? Well, maybe. One is that the top prize is usually bigger. If you wouldn't get out bed for a mere million pounds but wouldn't sniff at ten million, the Lottery might appeal more. Just don't hold your breath waiting for it to happen…
In addition, your chances of winning any prize with a single Lottery ticket (1 in 54) are much better than with a Premium Bond (1 in 24,000 in each draw). However, the minimum prizes with Lottery tickets are smaller - and your Premium Bond will be in entered in twelve draws a year for as long as you hold it.
Perhaps the best way of comparing the relative attractions of the Lottery and Premium Bonds is comparing the likely return on them from the same level of investment. Suppose then that you have a £30,000 windfall and invest it on (a) Premium Bonds and (b) the Lottery. What are your returns likely to be?
As from August 2005, the interest rate on Premium Bonds rose to 3.25 per cent per year. This has led some commentators to suggest that with average luck you could expect a return of 3.25 per cent on your investment. As prizes are tax-free, this would be the equivalent of 5.42 per cent for a higher rate tax-payer and 4.06 per cent for a basic rate one. Such rates would be comparable with many high street savings accounts.
I have to say this is misleading, though. That average figure of 3.25 per cent is boosted by a small number of very large prizes that, statistically, you are very unlikely to win. A more relevant statistic may be the fact that with £30,000 worth of bonds you can expect to win, on average, 15 prizes a year.
If these are all minimum £50 prizes, at the end of the year you will have won £750 worth of prizes, equivalent to an annual interest rate of 2.5 per cent tax-free. That's less than many savings accounts, of course, but every month you do have the chance of winning a bigger prize, up to the £1 million jackpot.
Now suppose that instead you invest your £30,000 on this week's Lottery draw. The statistics say that 50 per cent of all funds invested in the Lottery are returned as prizes. Again this is misleading, however, as a significant proportion of this money goes in a small number of very large prizes you are very unlikely to win.
A better guide comes from a surprising source. ITV's Saturday night quiz show The Big Call culminates in the winner being asked to choose between £25,000 and 100,000 Lottery tickets. If the winner doesn't go for the tickets, a viewer gets the opportunity instead. If you have watched the show, you will know that the 100,000 Lottery tickets typically produce around £30,000 in prizes, i.e. you get a return of 30 per cent.
Going back to my example, then, if you put your £30,000 windfall into Lottery tickets, with 'average luck' you could expect to get 30 per cent of 30,000 = £9,000 back. By contrast, with average luck again your £30,000 Premium Bond investment would give you a total return over a year of £30,750 (including the value of the Bonds, of course).
When you look at it like this, the Lottery really is a terrible investment. OK, it might be a bit of fun if you have no other use for a spare pound or two, but if you are spending any more than this, you should really consider saving up and buying Premium Bonds instead.
After all, think about it. With Premium Bonds you still get the chance to win a life-changing sum of money, but even if this doesn't happen they are still a decent investment, and you can get all your money back any time you need it.
If you're paying for Lottery tickets every week, therefore, my suggestion would be to put the money into a separate kitty instead and use it to buy Premium Bonds. The more you have, the better your chances will be, and every month your Bonds will be in with as good a chance of a big win as anybody else's. Be lucky!
* You can buy Premium Bonds at any post office or at the NS&I website at www.nsandi.com. If you already have Premium Bonds, you can also use this site to check whether they are holding any unclaimed prizes for you.
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