When you buy premium bonds you are entered into a monthly prize draw where you can win between £25 and £1 million tax free. The new higher prize fund percentage means the chance of winning a prize with every £1 bond number is reduced to 24,500-1 from the current 34,500-1. An estimated additional 1.4 million prizes will be paid out in the June draw.

But while the rejig will put money in the pockets of more savers, it’s important to be aware of the major downside of premium bonds in the current environment. They pay no interest and are therefore more vulnerable to inflation than other savings.

In April, the official inflation rate climbed to a 40-year high of 9%, and it looks likely to go even higher.

“In a time of low inflation, you may feel like this is a small price to pay for the chance of a big win, [but] while inflation is getting so hot, it means your money’s purchasing power is getting much faster. eroded,” says Sarah Coles, an analyst at investment firm Hargreaves Lansdown. “It means holding premium bonds comes at a higher cost.”

The change came in response to a series of Bank of England rate hikes, which have pushed savings across the board. A rate of 1.4% is higher than the interest some people will get on their savings.

The £1m prize won won’t change – it will be kept at two per month. However, it is predicted that there will be 10 £100,000 prizes in June, up from six in May, as the number of £50,000 prizes rises from 11 to 19, the number of £25,000 prizes rises from 24 to 40, and the number of £50,000 prizes 10,000 will increase from 58 to 98.

Many people will feel that with savings this low they might as well have a little fun with their money and hopefully win some of those prizes. Even the lowest price of £25 is much more interest than some people get out of their savings accounts in a year. And of course there is always the chance that you will win big