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  • FIRST POST
    • MSE Helen Saxon
    • By MSE Helen Saxon 16th Mar 16, 5:06 PM
    • 75Posts
    • 42Thanks
    MSE Helen Saxon
    Lifetime ISAs guide
    • #1
    • 16th Mar 16, 5:06 PM
    Lifetime ISAs guide 16th Mar 16 at 5:06 PM
    Hi!

    This is the discussion thread for the



    Click reply below to discuss. If you haven’t already, join the forum to reply. If you aren’t sure how it all works, read our New to Forum? Intro Guide.


    Thanks folks,
Page 32
    • elce
    • By elce 17th May 17, 8:42 AM
    • 4 Posts
    • 0 Thanks
    elce
    When to set up?
    Hi

    I'm self-employed, 37 (birthday in June) and have no pension provision. I'm thinking about setting up an LISA but wanted to ask the forum when would be the best time to set it up?

    - is there any benefit to setting it up immediately (and before my 38th birthday in June) while there are relatively few LISA products on the market - I was thinking about Hargreaves Lansdowne?

    or

    - is it better to wait for more products to come on stream as companies work out the rules and regs etc?

    any advice much appreciated! I'm new to the forum and new to getting my finances sorted!

    cheers!
    • eskbanker
    • By eskbanker 17th May 17, 11:16 AM
    • 5,466 Posts
    • 5,269 Thanks
    eskbanker
    I'm self-employed, 37 (birthday in June) and have no pension provision. I'm thinking about setting up an LISA but wanted to ask the forum when would be the best time to set it up?
    Originally posted by elce
    Have you evaluated and dismissed the idea of setting up an actual pension rather than going down the LISA route? Although they are intended for broadly similar purposes, there are many differences, see http://www.moneysavingexpert.com/savings/lifetime-ISAs#pension2 for a comparison.

    In terms of your actual question about timing if you do go with a S&S LISA, you can go with any of the existing providers for now and transfer to another later if you wish.
    • cjv
    • By cjv 17th May 17, 10:14 PM
    • 87 Posts
    • 45 Thanks
    cjv
    Thank you for all your input into this thread guys, it helped me make a decisions and take the step today to open a Nutmeg stocks and shares LISA. (my first ever savings account, late starter at 36 yrs old)

    I am planning to hold it for 3-5 years, depending on how my other saving plans go and then step into the world of a first time buyer, to try and get on the property ladder.
    • Mattmuzz
    • By Mattmuzz 18th May 17, 10:35 AM
    • 2 Posts
    • 0 Thanks
    Mattmuzz
    2nd Year Monthly?
    Hello guys!

    I am wondering, when the bonus begins to be paid monthly in the second year. Does this mean we need to pay in the maximum contribution at the start of the 2nd year period or make monthly contributions to ensure the full 1000 bonus for the 2nd year as well? Or can will still lump it in at the end?

    Cheers!
    • eskbanker
    • By eskbanker 18th May 17, 11:58 AM
    • 5,466 Posts
    • 5,269 Thanks
    eskbanker
    I am wondering, when the bonus begins to be paid monthly in the second year. Does this mean we need to pay in the maximum contribution at the start of the 2nd year period or make monthly contributions to ensure the full 1000 bonus for the 2nd year as well? Or can will still lump it in at the end?
    Originally posted by Mattmuzz
    My understanding is that you can choose to do any of the above and that the 25% bonus will be paid on any contributions made in any given month. So if you pay £4K in on 6 April 2018, you'll get a £1K bonus added to your account in May 2018, or if you pay in £4K on 5 April 2019 you'll get the £1K by 19 April 2019. Or if you pay in £300 every month then you'll receive £75 bonus every month, etc....
    • Tom_Hendo
    • By Tom_Hendo 18th May 17, 2:56 PM
    • 9 Posts
    • 0 Thanks
    Tom_Hendo
    Any news on anyone else offering a cash ISA? I still dont want to open one with the current providers (S&S options). I know skipton say theres is due for June 2017 but thats all ive heard.
    • eskbanker
    • By eskbanker 18th May 17, 6:41 PM
    • 5,466 Posts
    • 5,269 Thanks
    eskbanker
    Any news on anyone else offering a cash ISA? I still dont want to open one with the current providers (S&S options). I know skipton say theres is due for June 2017 but thats all ive heard.
    Originally posted by Tom_Hendo
    Having answered you when you've asked this before in March and April, there's unfortunately no change in the reply, in that the MSE article I've pointed you to previously still doesn't show any further entrants (when they've committed to update it when there's news) and to the best of my knowledge there haven't been any reported on the forum either....
    • saintjack04
    • By saintjack04 19th May 17, 8:24 PM
    • 1 Posts
    • 0 Thanks
    saintjack04
    Hi

    Quick question - Is the government investment of £1000 guaranteed if you invest £4000 per year, or is it dependent on the value of your ISA at the end of the year?

    So if you invested £4,000 in a shares LISA and your investment dropped in value and was worth £3500 at the end of the year, would the government investment still be £1000 or 25% of the £3500?

    Thanks
    • eskbanker
    • By eskbanker 20th May 17, 12:26 AM
    • 5,466 Posts
    • 5,269 Thanks
    eskbanker
    The bonus is paid at 25% of contributions, what happens after the contributions have been made (e.g. interest or growth) is irrelevant, so if you contribute £4K you'll receive a bonus of exactly £1K at the end of the claim period, no more and no less....
    • binaryuniverse
    • By binaryuniverse 20th May 17, 7:53 AM
    • 367 Posts
    • 170 Thanks
    binaryuniverse
    My understanding is that you can choose to do any of the above and that the 25% bonus will be paid on any contributions made in any given month. So if you pay £4K in on 6 April 2018, you'll get a £1K bonus added to your account in May 2018, or if you pay in £4K on 5 April 2019 you'll get the £1K by 19 April 2019. Or if you pay in £300 every month then you'll receive £75 bonus every month, etc....
    Originally posted by eskbanker
    I am hoping it's this. Would mean I can leave the money in some other, higher interest earning account, and then lump it all in, right at the end of the tax year.
    • eskbanker
    • By eskbanker 20th May 17, 11:53 AM
    • 5,466 Posts
    • 5,269 Thanks
    eskbanker
    My understanding is that you can choose to do any of the above and that the 25% bonus will be paid on any contributions made in any given month. So if you pay £4K in on 6 April 2018, you'll get a £1K bonus added to your account in May 2018, or if you pay in £4K on 5 April 2019 you'll get the £1K by 19 April 2019. Or if you pay in £300 every month then you'll receive £75 bonus every month, etc....
    Originally posted by eskbanker
    I am hoping it's this. Would mean I can leave the money in some other, higher interest earning account, and then lump it all in, right at the end of the tax year.
    Originally posted by binaryuniverse
    Perhaps worth noting that my comment related to the 2018/19 year, when bonus payments will be aligned with contributions and paid the following month.

    Deferring LISA contributions to the end of the tax year makes sense this (2017/18) year because the bonus is only payable at the end regardless of when contributions are made, but from next year there'll be less of a case to do this because you'll be able to earn interest (or investment growth) on the bonus as soon as it's paid in.
    • Tom_Hendo
    • By Tom_Hendo 22nd May 17, 12:16 PM
    • 9 Posts
    • 0 Thanks
    Tom_Hendo
    Having answered you when you've asked this before in march and april there's unfortunately no change in the reply, in that the MSE article I've pointed you to previously still doesn't show any further entrants (when they've committed to update it when there's news) and to the best of my knowledge there haven't been any reported on the forum either....
    Originally posted by eskbanker
    Thanks for the update. Yeah I ask each month so I get the most up to date info, dont think thats too much to ask is it?
    • djb87
    • By djb87 24th May 17, 10:03 AM
    • 1 Posts
    • 0 Thanks
    djb87
    Accidentally funded HTB and LISA! HELP!
    I have a query regarding funding both a Help to Buy ISA and a LISA in the same tax year.

    Before this current tax year (17/18) started, I had a Help to Buy ISA (with Lloyds) which I was funding on a direct debit basis, £200 per month. At the beginning of this new tax year, I set up and fully funded a Lifetime ISA with Nutmeg with £4000 (the maximum you can put in a LISA in a given tax year).

    Unfortunately, I forgot to switch off my direct debits, meaning that I have inadvertently paid an extra £200 this side of the tax year - in May - into my Help to Buy ISA.

    Please advise on how I can rectify this. I am concerned that I will not be able to use my HTB ISA to buy a house this tax year if I don't do the right thing. It seems logical that I should take £200 out of my HTB ISA so everything squares off.

    I have phone HMRC who have been no help whatsoever!
    • isasmurf
    • By isasmurf 24th May 17, 10:12 AM
    • 1,719 Posts
    • 738 Thanks
    isasmurf
    You have done nothing wrong. You are allowed to contribute to both a HTB and LISA in the same tax year. You will only be able to use the bonus from one of them for a house purchase, however.

    If your intention is to use the HTB ISA bonus for the house purchase, you should continue to save in this.
    • Ed-1
    • By Ed-1 24th May 17, 10:37 AM
    • 1,974 Posts
    • 1,057 Thanks
    Ed-1
    I have a query regarding funding both a Help to Buy ISA and a LISA in the same tax year.

    Before this current tax year (17/18) started, I had a Help to Buy ISA (with Lloyds) which I was funding on a direct debit basis, £200 per month. At the beginning of this new tax year, I set up and fully funded a Lifetime ISA with Nutmeg with £4000 (the maximum you can put in a LISA in a given tax year).

    Unfortunately, I forgot to switch off my direct debits, meaning that I have inadvertently paid an extra £200 this side of the tax year - in May - into my Help to Buy ISA.

    Please advise on how I can rectify this. I am concerned that I will not be able to use my HTB ISA to buy a house this tax year if I don't do the right thing. It seems logical that I should take £200 out of my HTB ISA so everything squares off.

    I have phone HMRC who have been no help whatsoever!
    Originally posted by djb87
    A Help to Buy ISA is a cash ISA. You can pay into a cash ISA as well as pay into a Lifetime ISA.
    • eskbanker
    • By eskbanker 24th May 17, 11:13 AM
    • 5,466 Posts
    • 5,269 Thanks
    eskbanker
    I am concerned that I will not be able to use my HTB ISA to buy a house this tax year if I don't do the right thing.
    Originally posted by djb87
    If you're wanting to buy a house this tax year then you won't be able to get the 25% bonus on the £4K in your LISA, as penalty-free LISA withdrawals are only possible a full 12 months after opening and the first LISA bonuses won't be paid until early in the next tax year.
    • MTG84
    • By MTG84 27th May 17, 11:19 AM
    • 2 Posts
    • 0 Thanks
    MTG84
    Help to Buy bonus and LISA bonus combined?
    Hi all,

    Sorry if this has already posted, but i still am a little confused with the bonus payments between the transfer from the Help to buy to a LISA.

    I have had a Help to Buy ISA since April 2016 and have built it up £4,000 (with a £1,000 bonus currently).

    If i were to transfer this to a LISA account and have the open for 12 months, at the end of the 12 month period, would i receive both the £1,000 bonus built up from the help to buy isa PLUS a £1,000 bonus from the LISA account to have £2,000 bonus by the end of June 2018?

    E.g at the end of June 2018:
    • Help to buy isa transfer during 2017/2018 to tax year to an isa - £4,000 (£1,000 bonus)
    • Lisa contribution - £4,000 (£1,000 bonus)
    • = £2,000 bonus by June 2018?

    Thanks for any help on this!
    • Ed-1
    • By Ed-1 27th May 17, 1:20 PM
    • 1,974 Posts
    • 1,057 Thanks
    Ed-1
    Hi all,

    Sorry if this has already posted, but i still am a little confused with the bonus payments between the transfer from the Help to buy to a LISA.

    I have had a Help to Buy ISA since April 2016 and have built it up £4,000 (with a £1,000 bonus currently).

    If i were to transfer this to a LISA account and have the open for 12 months, at the end of the 12 month period, would i receive both the £1,000 bonus built up from the help to buy isa PLUS a £1,000 bonus from the LISA account to have £2,000 bonus by the end of June 2018?

    E.g at the end of June 2018:
    • Help to buy isa transfer during 2017/2018 to tax year to an isa - £4,000 (£1,000 bonus)
    • Lisa contribution - £4,000 (£1,000 bonus)
    • = £2,000 bonus by June 2018?

    Thanks for any help on this!
    Originally posted by MTG84
    Anything paid into the LISA in 2017/18 (and that includes anything transferred from a H2B ISA) receives a 25% bonus at the start of May 2018.

    Anything paid in to the LISA in 2018/19 onwards gets a bonus at the start of the month after it was paid in.
    • MTG84
    • By MTG84 27th May 17, 1:23 PM
    • 2 Posts
    • 0 Thanks
    MTG84
    Anything paid into the LISA in 2017/18 (and that includes anything transferred from a H2B ISA) receives a 25% bonus at the start of May 2018.

    Anything paid in to the LISA in 2018/19 onwards gets a bonus at the start of the month after it was paid in.
    Originally posted by Ed-1
    Thanks, does this mean i would receive the bonus already built up from the help to buy isa in addition to the lisa bonus?
    • Ed-1
    • By Ed-1 27th May 17, 1:59 PM
    • 1,974 Posts
    • 1,057 Thanks
    Ed-1
    Thanks, does this mean i would receive the bonus already built up from the help to buy isa in addition to the lisa bonus?
    Originally posted by MTG84
    Yes as it was paid into the LISA. Anything paid into the LISA gets a LISA bonus of 25% at the start of May 2018:

    Anything paid into the LISA in 2017/18 (and that includes anything transferred from a H2B ISA) receives a 25% bonus at the start of May 2018.
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