Pensioner Bonds – savings for over 65s

“Pensioner Bonds” currently provide savers over 65 with significantly higher interest rates than those on the high street. They are popular for paying higher interest than the best fixed rate savings accounts, and are an attractive option for eligible savers.


Essential Pensioner Bond facts


Although the media and general public have been calling them “Pensioner Bonds”, they’re actually named “65+ Guaranteed Growth Bonds” – and can be used as a high interest alternative to a fixed-rate savings account. They’re available from  NS&I (National Savings and Investments):


Will the deadline for Pensioner Bond applications change?

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  • You can choose a 1 year and 3 year option, with 2.80% and 4.00% gross/AER interest rates respectively.
  • There is a penalty of 90-days interest if you withdraw your money early
  • Income from the bonds is taxable, unlike cash ISAs and premium bonds, However, non-taxpayers and those eligible for the new 0% rate from April 2015 can reclaim the tax.
  • These high-interest paying alternatives to savings accounts are open to anyone over the age of 65. However, the minimum amount you can save into the account is £500.


Is there a limit to the amount you can save?


NS&I Pensioner Bonds have an upper limit of £10,000 per person, per account. You are allowed to take out both a 1 and a 3 year bond, and save up to £10,000 in each. Therefore couples can save up to £40,000 if they both buy a 1 year and 3 year bond. Bear in mind that you can’t use the interest from these bonds to supplement your income on a monthly basis, as it’s paid at the end of either the 1 year or 3 year term.


Is there a deadline for buying Pensioner Bonds?


The bonds have been extremely popular and the deadline for applications has now been extended until 15th May. Chancellor George Osborne commented that the bonds have had “the biggest opening sales of any retail financial product” in recent years. The Government had orginially set aside £10 billion for the Pensioner Bonds, and there had been some concern amongst the over 65s that the bonds will sell out faster than anticipated. In response, soon after the launch of the bonds, Osborne mentioned that he expects them to be on sale “for months”, taking to twitter to reassure savers that there are plenty available. The £10bn cap has now been removed due to the high demand, to ensure that more savers can take advantage of the attractive interest rates.


This change was made in response to very high demand. Sylvia Walcot of data firm Moneyfacts had warned that the bonds would be gone “in days”. There was a huge surge in applications when they went on sale, with three quarters of the original £10bn allocation being sold in the first three weeks to 610,000 applicants . They’re selling fast, but the NS&I website and staff have at times been unable to cope with the demand. At the time of writing the NS&I website informs users that they’re experiencing a very high volume of calls and applications.


How do I apply?


You can apply for the bonds or find out more information online or by phone, email or post:




Online: If you’d like to check the details or apply online you can do so on the NS&I website.


Phone: 0500 007 007 for enquiries about bonds and 0500 500 000 to apply.


Post: NS&I, Glasgow, G58 1SB


Not eligible for the NS&I Pensioner Bonds, or looking for an alternative savings account? Check out our cash ISA guide, where we discuss some of the best ISA rates for over 50s, and other ways you can maximise savings in your 50s, 60s and beyond.


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