Lifetime ISAs guide

Alexland

Kreacher wrote: »

Thank you. I spoke to Skipton to get confirmation and they said I have £2100 of my allowance left... Very confused!

I agree that doesn't make sense if you have contributed 10 months at £200 into the HTB and £100 to the LISA. Is there any possibility you missed a HTB contribution or your April contribution was before the 6th?? Also Skipton have probably not received the interest information from your HTB provider.

Alexland

NevvyC wrote: »

The 0.75 is low ...

But considering people who have transferred HtB ISAs in and then maxing out this tax years 4K allowance... Such as myself ... Hypothetically, chucking another 4K in early on in the 18/19 tax year ; then 0.75% on this lump sum (say 8K minimum) soon stacks up, no ?

I'm already trying to think ahead whether my *spare* funds would be best placed in a product like a 5% regular saver (where the max deposit is £200pcm) for another year or chucking that 2nd 4K at the LISA and earning 0.75 on the lot ASAP in the new tax year ?!?

Any ideas

Yes it is better to hold the money in a better account such as the flexible 5% Nationwide products for the majority of the tax year then make the LISA contribution towards the end of the tax year. But don't leave it too late as we have already seen occasions where Skipton appear to have unexpectedly rejected contributions so leave enough time to resolve issues.

Alex

Alexland

Buckets86 wrote: »

Following my post above, I noticed on the Skipton website that you can only pay into one Lifetime ISA in each tax year. As I have already paid into the Nutmeg LISA this year (albeit only £100), does this therefore mean that I would have to top it up to the max value (ie. £4,000 less contributions into HTB ISA since 5 April 2017) BEFORE transferring to the Skipton one?

I obviously want to get this right before I start moving things around, and the Skipton deadline is fast approaching!

It's the same LISA you are just transfering it between providers. It probably makes more sense to top it up after both accounts have transfered as the interest earned this tax year while money is in the HTB ISA also counts towards the £4k limit.

Alex

System

Alexland wrote: »

Yes it is better to hold the money in a better account such as the flexible 5% Nationwide products for the majority of the tax year then make the LISA contribution towards the end of the tax year. But don't leave it too late as we have already seen occasions where Skipton appear to have unexpectedly rejected contributions so leave enough time to resolve issues.

Alex

Sorry, to clarify!; this is precisely what I have been doing THIS tax year to make my money work for itself and make the 4K for the LISA therefore (albeit slightly!) easier to achieve... By adding as much as possible (up to the monthly Max deposit limit imposed of £500)

My question (or pitch) "Any ideas " was referring to the NEXT tax year... As in, would I be better off stashing money away in a similar 5% regular saver account (with a lower monthly deposit limit of only £200pcm now...) starting from scratch at zero balance

OR

Utilising the BULK I will now have in my LISA (HTB transfer + LISA 4K Max + gov bonuses + 0.75% earned annually - I opened my account in June '17 so will receive that in Jun '18 :j) and adding any additional funds I can spare (that would otherwise be going into the 5% reg saver product but at a capped £200pcm...) to this BULK ???


...

(Normally I would have said it wouldn't matter as the 5% on 200pcm would likely outweigh 0.75%) but since the 0.75% interest will be compounding AND on the entire BULK sum in the LISA; it's hard to tell which would be the best option in the new tax year ... Just trying to get ahead of things

Thanks in advance for any advice / wisdom imparted - it's much appreciated!

Alexland

I don't see why you wouldn't continue to contribute to the cash LISA towards the end of the tax year in future years. It makes sense if the additional interest you would receive on the earlier bonus is less than the additional interest you would gain by the money being in an alternative account. Just make sure that whatever account you are using is not locking you into a minimum period.

ps the Nationwide regular saver is £250 per month (down from £500 per month) not £200 per month?

Alex.

System

Oh is it ? I haven't looked into it yet that much since I'm still on the £500pcm one until it runs out (someone else mentioned to me it was £200 so was working with that figure )

I would absolutely continue to, to earn the govt bonuses - I'm just pondering which is the best strategy to allow my money to work harder (so that at the end of the day I can get away with putting the least possible of my own hard-earned £ in the LISA to still achieve the max allowance)

ie. would earning 0.75% compounding on the cumulative total over the course of the 18/19 tax year, earn more than £250 a month going into a 5% regular saver in increments of 250 starting from zero balance ... And therefore outweigh the 5% option (I likely couldn't afford to do both) ... The way I have been saving for THIS tax years' max 4K was putting £500pcm in my regular saver whenever I could so that it requires less 'topping up' with my own money at the end of the day.

System

Oh sorry I may have misread the inflection of your reply ... My point being that I'm not sure which would earn the higher value of £ : the LISA (with all those juicy thousands now in, earning 0.75%, compounding) vs the Nationwide 5% reg saver (with much smaller amounts) compounding...

Or am I looking at it in a light I can't phantom currently) whereby the 0.75% still hits on the LISA bal ; so the reg saver would just be earning 5% anyways on whatever balance and negates the 'whatever' balance that could be being invested into the LISA ... I think I had this confusion previously actually haha! Talking through it has helped me remember though

Kim_13

One Family have launched a S&S LISA with a choice of two funds: https://www.onefamily.com/lifetime-isa/

stphnstevey

Does anyone know the rules about opening prior to 40?

ie. if you dont, do you miss out on ever opening one?

If you open one prior, can you open more after 40? Can you transfer after 40?

Ed-1

stphnstevey wrote: »

Does anyone know the rules about opening prior to 40?

ie. if you dont, do you miss out on ever opening one?

If you open one prior, can you open more after 40? Can you transfer after 40?

You can only open one after 40 for the purpose of transferring in one you opened before 40.