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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 40
    • sybil44
    • By sybil44 23rd Jun 17, 12:03 PM
    • 1 Posts
    • 0 Thanks
    sybil44
    2- 16 year olds and an 18 year old
    Hi,
    I have twin boys who have just turned 16 and an 18 year old. I would like to save for their first houses. where we live this will be more than the £250,000 limit so a lisa will be better but you have to be 18 for a lisa . I want to save exactly the same for all of them. so can I open them all a help to buy isa now and transfer all 3 of them to a lifetime isa in 2 years time when they are all 18 or over? the only info I can find is transferring a help to buy isa to life time isa by April next year but i need to wait till May 2019 to transfer because of the age constraints is still possible to swap after 2 years.
    Thanks in advance
    Sybil
    • eskbanker
    • By eskbanker 23rd Jun 17, 12:51 PM
    • 5,466 Posts
    • 5,270 Thanks
    eskbanker
    I have twin boys who have just turned 16 and an 18 year old. I would like to save for their first houses. where we live this will be more than the £250,000 limit so a lisa will be better but you have to be 18 for a lisa . I want to save exactly the same for all of them. so can I open them all a help to buy isa now and transfer all 3 of them to a lifetime isa in 2 years time when they are all 18 or over? the only info I can find is transferring a help to buy isa to life time isa by April next year but i need to wait till May 2019 to transfer because of the age constraints is still possible to swap after 2 years.
    Originally posted by sybil44
    Yes, they (not you, they need to do all this themselves) can transfer from HTB to LISA anytime - the transitional arrangement for this tax year relates solely to transferring older HTB funds into a LISA without counting towards the £4K annual LISA allowance. Transfers of HTBs to LISAs in subsequent years are possible but are treated as current year subscriptions to the LISAs and are therefore capped at the annual allowance of £4K.

    The official version is at section 9B.17 of https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/603261/ISA_Lifetime_ISA.pdf

    Incidentally, the government documentation on HTB starting age is contradictory! According to the FAQ they can be opened by "Anyone who is over 16" but the full scheme rules clarify "16 years of age or over".
    • eskbanker
    • By eskbanker 23rd Jun 17, 1:05 PM
    • 5,466 Posts
    • 5,270 Thanks
    eskbanker
    Obvious question but I can't find an answer and I'm in a quandry as to whether to save in a (cash) Lifetime Isa or Help to Buy.. There are reports that with the interest rate being so poor in a Lifetime Isa, despite the fact you can put bigger lump sums in than with a Help to Buy, you would still eventually lose out compared to the H2B with biggest ineterst rates. Is this true? I would have enough for a healthy deposit for my first home, so I'm not too bothered about not being able to use the H2B for that, and I'm looking a couple of years down the line, so I'm not bothered about the money being held in the Lifetime Isa for a year either. My problem is working out whether my money would be better off in a H2B where you can put less in, or a Lifetime Isa where you can save more but have a very low interest rate. I have a poorly paid job, but savings, some of which are in accounts that have good interest rates, up to a limit, and I want to save the rest in one of theses. Can anyone advise me??
    Originally posted by CatGilmurray
    It's impractical to work out what's best for you based on that information as there are too many unknown variables - all the relevant lump sums and interest rates need to be factored in, as would the length of time you're planning to save.

    HTBs do indeed pay better interest than the only cash LISA on the market so far, but as you say the contribution caps differ and so the 25% of the larger LISA amount is likely to be worth having, dependent obviously on what that money would otherwise be earning.
    • CatGilmurray
    • By CatGilmurray 23rd Jun 17, 4:47 PM
    • 2 Posts
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    CatGilmurray
    It's impractical to work out what's best for you based on that information as there are too many unknown variables - all the relevant lump sums and interest rates need to be factored in, as would the length of time you're planning to save.

    HTBs do indeed pay better interest than the only cash LISA on the market so far, but as you say the contribution caps differ and so the 25% of the larger LISA amount is likely to be worth having, dependent obviously on what that money would otherwise be earning.
    Originally posted by eskbanker
    Thanks, I guess I'll have to get my calculator out! I just don't want to make a mistake when certain newspapers and warning against the Lifetime Isa, or saying it's not what it's cracked up to be. One even said that due to it's poor interest rate even if you maxed it out on all the money you can potentially put into it, you'd still be losing money compared to a H2B with good interest rate...
    • Kami J
    • By Kami J 24th Jun 17, 9:05 AM
    • 4 Posts
    • 1 Thanks
    Kami J
    Thanks, I guess I'll have to get my calculator out! I just don't want to make a mistake when certain newspapers and warning against the Lifetime Isa, or saying it's not what it's cracked up to be. One even said that due to it's poor interest rate even if you maxed it out on all the money you can potentially put into it, you'd still be losing money compared to a H2B with good interest rate...
    Originally posted by CatGilmurray
    The thing that makes LISA potentially more attractive is that it has a cap of 4k, while HTB is only 2.4k, which means the government bonus on LISA can be more. The interest rates for LISA is indeed less, but if you are able to save more than 2,400 a year (especially if you're going to max it out at 4k), the additional bonus might make it more attractive than HTB.
    Last edited by Kami J; 24-06-2017 at 9:58 AM.
    • Kami J
    • By Kami J 24th Jun 17, 10:03 AM
    • 4 Posts
    • 1 Thanks
    Kami J
    Any thoughts on this? Just to clarify, I am not planning on moving money into Nutmeg until just before the end of the year, so it won't sit there long, and if I decided to hold off on buying, I might then see whether there are cash alternatives available...

    I have an HTB that I am still paying into and opened a 100 Nutmeg LISA in April. I'm planning to buy in late 2018 / early 2019.

    I have intended to switch to a cash LISA when it becomes available, but seeing how low the Skipton rate is made me question that. Is there a good reason NOT to stay with Nutmeg, transfer in my HTB in March 2018 and use it when bonuses hit?

    I know the S&S are more volatile than cash, but with inflation as it is, Skipton's 0.5% is a losing game. I picked the lowest risk profile on Nutmeg, so I am thinking that in the worst case, I will lose a little bit, but potentially can gain a bit more - but overall the swing in either direction won't be much so why bother with switching? Am I missing something?
    Originally posted by Kami J
    • forethugel
    • By forethugel 28th Jun 17, 8:27 AM
    • 1 Posts
    • 0 Thanks
    forethugel
    HTB ISA vs LISA and transfer
    Hi,
    so grateful to have this site, and Martin's video has answered all of my HTB ISA vs LISA questions very well - but not all!
    I'm looking into getting a cash LISA and living in the south east with its high property prices it's a no-brainer for me. However, I've got a HTB ISA running for just over 2 years now which pays a very good 4% interest. Because of that, I have not much desire to "transfer" but rather keep it running as a pure savings ISA for now. Instead, I'd be looking into paying the LISA from other sources, e.g. a matured regular saver.
    I know that I won't be able to transfer the HTB ISA to the LISA if I don't do it within one year, but I don't have any issue with that especially as I can pay into a LISA much more quickly. I know I have to work out when I would be likely buying, but the LISA bonus would "overtake" my HTB ISA bonus very quickly.

    My questions are:
    - Is there any reason why I couldn't keep my HTB ISA open and use it to save until I buy a property, but instead feed the LISA with cash from elsewhere?
    - Given that that the HTB ISA is an ISA, I'm assuming that interest doesn't contribute to the Personal Savings Allowance, correct?
    - Does the timing of paying into the LISA affect the annual bonus other than that it has to be within the same tax year?
    - Is the LISA bonus only paid on "complete" tax years? For instance, if I buy a house in February do I get any kind of bonus for that year at all?
    Thanks!
    Last edited by forethugel; 28-06-2017 at 8:52 AM.
    • Ed-1
    • By Ed-1 28th Jun 17, 10:39 AM
    • 1,979 Posts
    • 1,057 Thanks
    Ed-1
    Hi,
    so grateful to have this site, and Martin's video has answered all of my HTB ISA vs LISA questions very well - but not all!
    I'm looking into getting a cash LISA and living in the south east with its high property prices it's a no-brainer for me. However, I've got a HTB ISA running for just over 2 years now which pays a very good 4% interest. Because of that, I have not much desire to "transfer" but rather keep it running as a pure savings ISA for now. Instead, I'd be looking into paying the LISA from other sources, e.g. a matured regular saver.
    I know that I won't be able to transfer the HTB ISA to the LISA if I don't do it within one year, but I don't have any issue with that especially as I can pay into a LISA much more quickly. I know I have to work out when I would be likely buying, but the LISA bonus would "overtake" my HTB ISA bonus very quickly.

    My questions are:
    - Is there any reason why I couldn't keep my HTB ISA open and use it to save until I buy a property, but instead feed the LISA with cash from elsewhere?
    - Given that that the HTB ISA is an ISA, I'm assuming that interest doesn't contribute to the Personal Savings Allowance, correct?
    - Does the timing of paying into the LISA affect the annual bonus other than that it has to be within the same tax year?
    - Is the LISA bonus only paid on "complete" tax years? For instance, if I buy a house in February do I get any kind of bonus for that year at all?
    Thanks!
    Originally posted by forethugel
    You can transfer part of your H2B ISA - you don't have to transfer it all. If you only transfer contributions that were made up to 5th April 2017 across to LISA you can then add £4,000 on top and still keep paying into your H2B ISA.

    Yes - interest from any type of ISA doesn't count towards your PSA.

    Bonuses will be paid each month from April 2018 so the earlier you contribute from then the earlier you'll get your bonus.
    • White Bear
    • By White Bear 28th Jun 17, 5:48 PM
    • 1 Posts
    • 0 Thanks
    White Bear
    Hi, 1st post and a brief question please -

    I assume the 25% bonus is not treated as interest earned as far as tax liability is concerned ?

    Thanks
    • eskbanker
    • By eskbanker 28th Jun 17, 5:50 PM
    • 5,466 Posts
    • 5,270 Thanks
    eskbanker
    Hi, 1st post and a brief question please -

    I assume the 25% bonus is not treated as interest earned as far as tax liability is concerned ?

    Thanks
    Originally posted by White Bear
    It's an ISA so there is no tax liability!
    • Dribiddi
    • By Dribiddi 29th Jun 17, 12:54 AM
    • 52 Posts
    • 22 Thanks
    Dribiddi
    Can you not have both a lifetime isa and a help to buy isa?
    • drr2222
    • By drr2222 29th Jun 17, 4:48 PM
    • 1 Posts
    • 0 Thanks
    drr2222
    Hi all,

    Just joined the forum and wondered if someone may be able to confirm my plan will work with the Lifetime ISA for purchasing a house.

    I have set up 2 LISA's, for me and my partner, which I have put £1 in each to start the clock ticking.

    I intend, before the end of this tax year, perhaps March next year, to increase each to the full balance of £4000, thus qualifying for the £1000 bonus.

    The month after (into the 2018/19 tax year), I was planning to put an additional £4000 in each, as I have heard that the bonus is paid monthly after the 2017/18 tax year, so theoretically by this time next year I will have paid in £16000, and received £4000 in bonus?

    I will also be transferring in my HTB ISA which has qualifying funds of £4200 (made before 06/04/17), so a bonus of £1050 in addition, making a total of £5050 in bonus towards our first home.

    Can anyone confirm that this will happen or am I missing something?

    Thanks in advance
    • Bicker
    • By Bicker 1st Jul 17, 3:14 PM
    • 11 Posts
    • 1 Thanks
    Bicker
    That is correct, Drr.

    I'm in a similar position. 5k bonus in 12 months sounds too good to be true doesn't it!
    • NevvyC
    • By NevvyC 1st Jul 17, 5:11 PM
    • 37 Posts
    • 1 Thanks
    NevvyC
    Does anyone know here what a typical 'salary multiplier' mortgage providers offer ? Just trying to work out what salary I might need to work for in order to buy a certain value property ...

    For example, Barclays were offering a 4x multiplier for a certain scheme (but imagine there are far better offers out there if you trump up more deposit £££)

    Thanks for any insight in advance !
    • Jino2017
    • By Jino2017 1st Jul 17, 5:54 PM
    • 1 Posts
    • 0 Thanks
    Jino2017
    Transferred from one Lisa to another
    Hello

    Sorry if this question has already been asked.

    I opened a hargreaves Lisa on 6th April 2017 to 'start the clock'. I then opened a Skipton cash Lisa on 6th June and have transfered my HL Lisa and my help to buy isa i had into the Skipton Lisa. I don't plan to buy until after April 2018

    Am I right in thinking that I'll be able to use the Skipton Lisa after 6th April 2018 or will I have to wait until June?

    Many thanks

    James
    • LODGER81
    • By LODGER81 3rd Jul 17, 1:16 PM
    • 1 Posts
    • 0 Thanks
    LODGER81
    Stock lisa
    Does money held in cash on a stock/share Lisa count towards the £4,000 contribution?.
    If it does I'D Need to work out how much cash to leave for fees over the year out OF THE £4,000.
    • Ed-1
    • By Ed-1 3rd Jul 17, 1:29 PM
    • 1,979 Posts
    • 1,057 Thanks
    Ed-1
    Does money held in cash on a stock/share Lisa count towards the £4,000 contribution?.
    If it does I'D Need to work out how much cash to leave for fees over the year out OF THE £4,000.
    Originally posted by LODGER81
    Anything you put into it counts as a contribution. Growth/bonus is not a contribution. Anything else is.
    • tg99
    • By tg99 3rd Jul 17, 11:43 PM
    • 494 Posts
    • 212 Thanks
    tg99
    AJ Bell now offering a stocks and shares LISA. Don't think there is currently anyone else that enables you to invest in your own choice of funds / shares in a LISA other than Hargreaves?
    • Tilly77
    • By Tilly77 7th Jul 17, 12:00 PM
    • 1 Posts
    • 0 Thanks
    Tilly77
    Lifetime ISA
    Hi - 2 questions -

    1. Is it possible to open more than one Lifetime ISA and use them together towards buying a house? Or can you only use one of your Lifetime ISA accounts per house deposit/mortgage.

    2. Can you transfer money into the Lifetime ISA account monthly which adds up to £4000 over that year, or must the £4000 be transferred as a lump sum?

    Thanks in advance.
    • Katie-Jane
    • By Katie-Jane 8th Jul 17, 8:53 AM
    • 27 Posts
    • 10 Thanks
    Katie-Jane
    Hi All,

    Quick question;

    I opened a Skipton LISA a few months ago and today I have opened one for my husband. He can't afford to save until he has cleared his debt. But there is nothing to stop me saving in it is there? They don't check where the money has come from right?

    Thanks
    Currently paying off debt and saving a deposit for our first house
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