Originally established by the British Government in 1861, National Savings & Investments (NS&I) products are intended to encourage people to save for the future, to provide a secure home for their savings and to generate a valuable supply of funds for the UK Exchequer. When individuals invest in a NS&I product, they are lending money to the Government; in exchange, the Government guarantees the safety of their capital and provides an additional incentive in the form of interest, Premium Bond prizes, or returns linked to the performance of the UK stock market.
NS&I offers a broad range of products aimed at investors who might be looking for income or growth, for tax-free products, or who might want to protect the real value of their capital from the effects of inflation. Simple, straightforward savings accounts and investments for children are also available, as are Premium Bonds, which are probably the best-known of all NS&I’s products. Today, NS&I has around 25 million customers with more than £193 billion invested.
NS&I is arguably the most secure place for UK savers to put their money. All the products are backed by the Government so, unless the country finds itself in serious financial trouble, investors can feel confident their capital is safe. However, this safety comes at a price: greater security means lower risk and investors pay for peace of mind by sacrificing the higher returns they might have earned from a riskier investment.
