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    • ani*fan
    • By ani*fan 10th Jul 17, 12:18 PM
    • 1,497Posts
    • 3,642Thanks
    ani*fan
    Borrowing from a LISA
    • #1
    • 10th Jul 17, 12:18 PM
    Borrowing from a LISA 10th Jul 17 at 12:18 PM
    I have a quick question about LISA savings accounts.

    Everything I've read says there is a 25% penalty for withdrawing before the age of 60 for anything other than a first time house purchase.

    I've also read there is an idea about making the LISA similar to the American 401k in that we'd be able to borrow up to 50% of the value with no penalty but perhaps with some interest, as long as it was paid back within 5 years.

    Does anyone know if there are plans to make a decision about this? Or when that will be?

    Thanks you clever people.
    If you know you have enough, you're rich.
Page 1
    • eskbanker
    • By eskbanker 10th Jul 17, 12:53 PM
    • 5,466 Posts
    • 5,269 Thanks
    eskbanker
    • #2
    • 10th Jul 17, 12:53 PM
    • #2
    • 10th Jul 17, 12:53 PM
    According to https://www.whatdotheyknow.com/request/lifetime_isa_flexibility there was some early speculation last year that there would be 401K-style flexibility built in but this didn't make it into the scheme rules on introduction, which explicitly state (in clause 6.77a) that "Lifetime ISAs cannot be offered as flexible ISAs".

    In the response to the FOI request, the Treasury refused to answer the question "Can the Treasury provide any information on its current plans and any broad timetable for when a policy decision on Lifetime ISA flexibility is due?" so unless there has been any subsequent update it would appear that nobody is letting on if there are any such plans!

    If I was considering funding a LISA I think I'd assume that the rules will stay as they are rather than expecting to be able to shift money out and back again....
    • ani*fan
    • By ani*fan 10th Jul 17, 3:06 PM
    • 1,497 Posts
    • 3,642 Thanks
    ani*fan
    • #3
    • 10th Jul 17, 3:06 PM
    • #3
    • 10th Jul 17, 3:06 PM
    Thanks for that.

    You're right, I won't plan around being able to do this. Shame though, it would be way more appealing with some flexibility. Even a limited number of withdrawals over the accounts lifetime would work better.

    Ah well.
    If you know you have enough, you're rich.
    • Ed-1
    • By Ed-1 10th Jul 17, 10:42 PM
    • 1,974 Posts
    • 1,057 Thanks
    Ed-1
    • #4
    • 10th Jul 17, 10:42 PM
    • #4
    • 10th Jul 17, 10:42 PM
    Thanks for that.

    You're right, I won't plan around being able to do this. Shame though, it would be way more appealing with some flexibility. Even a limited number of withdrawals over the accounts lifetime would work better.

    Ah well.
    Originally posted by ani*fan
    It was George Osborne's pet project. Come back Gideon! All is forgiven!
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