Lifetime ISAs guide

grumiofoundation

Curly said:

Hi everyone, have you any idea when the cutoff date is for getting your extra 25% the same month. im with the nottingham and im in the early stadge of buying a house. i really want to put some more money into it to maximise the grant however there is no point if i cant get the bonus this month as the house will probly go through in the next 6 weeks or so.

There still is a point.
You could still pay in the £4000 and even if the bonus isn't paid in time get your solicitor to withdraw the £4000 for use for deposit. Ask solicitor to keep LISA open and then when bonus paid have £1000 for retirement (if so switch to Stocks and shares LISA) or pay penalty and withdraw £750 in cash. 

Curly

Thanks i managed to get it paid in today the 5th so it should be there in time. with the extra 2k i get (me and my wife) it will knock 6.5k off the total i need to pay back in 30 or so years. plus it will reduce my payments by £4 a month, allowing me to at least pay an additional £48 overpayment from what i would of overpaid.

Nate_652

Hi all. I'm currently saving for a house with a H2B ISA, maxing it out each month, but I have an extra £2-300 left over each month after all my expenses. I'm wondering what the best thing to do with the additional money is as a normal savings account seems like a waste, as does it sitting in my current account. We wouldn't be buying for atleast two years, probably three
1) Can I get my fiancee to open a Lifetime ISA and I pay into that, either myself of via her via direct debit each month?. This is my preferred option as we'd both get the 25% bonus when buying a house. 
2) investing in something like Vanguard. I've never done this and I wouldn't be putting in the full amount, just something pretty safe like their Life strategy funds for a few years

3) any other options?

eskbanker

If you're definitely buying together then option 1 would be best, bearing in mind that money in her name is legally hers.  There are many who see Vanguard investments as 'safe' for some reason but they're really not (in the sense that they're just as likely to lose short-term value as anyone else's).

grumiofoundation

Nate_652 said:

Hi all. I'm currently saving for a house with a H2B ISA, maxing it out each month, but I have an extra £2-300 left over each month after all my expenses. I'm wondering what the best thing to do with the additional money is as a normal savings account seems like a waste, as does it sitting in my current account. We wouldn't be buying for atleast two years, probably three
1) Can I get my fiancee to open a Lifetime ISA and I pay into that, either myself of via her via direct debit each month?. This is my preferred option as we'd both get the 25% bonus when buying a house. 
2) investing in something like Vanguard. I've never done this and I wouldn't be putting in the full amount, just something pretty safe like their Life strategy funds for a few years

3) any other options?

1) Yes.* Don't think you can pay in (but as you say can do via her - although this becomes then her money). 
Means can't buy a property for 12 months.
Property price (outside London) still limited to 250k by HTB ISA.
*(am assuming she is a first time buyer and you are happy to gift her the money).
2) Depending on what you mean by 'a few years' and 'pretty safe'. If you invest money in vanguard life strategy funds (or other mutli-asset funds which are available) may be worth less than they are today in say 3 years time. Are you happy to take that risk?
3) Only thing to consider might be you opening, and contributing to, a lifetime ISA yourself. 

If you aren't going to buy before April 2023 (edit - 3 tax years) then a lifetime ISA will give you the same max. bonus as HTB ISA (with potential for more bonus) and doesn't limit you to 250k outside london (drawback is the non penalty free accessibility of LISA vs HTB ISA). 

Edit: You don't have to close, or stop contributing to the HTB ISA to open or contribute to lifetime ISA.

There is the option to combine 1) and 2) by opening a stocks and shares lifetime ISA (same risks as mentioned above apply - not necessarily very sensible for money you will need in a few years). 

Edinburgh4a

I've put my £4000 in my LISA for this tax year now so I'll get my bonus on that in the next month or so. 
What do I do with any other savings this year? Can I not put them in here & just accept the government won't give me any more bonus or do I need to open up another ISA somewhere and save into that?

eskbanker

Edinburgh4a said:

I've put my £4000 in my LISA for this tax year now so I'll get my bonus on that in the next month or so. 
What do I do with any other savings this year? Can I not put them in here & just accept the government won't give me any more bonus or do I need to open up another ISA somewhere and save into that?

You can't pay more than £4K into a LISA in any given tax year, full stop.

Your options for other money you have will depend on a range of factors (including how much, when it's likely to be needed, your tax situation, etc) but you could do worse than this article and those linked from it: https://www.moneysavingexpert.com/savings/which-saving-account/

Littlebob_wales

Hello, 

It is clear from the LISA guide page that you can open one LISA per tax year and have multiple open at the same time so long as you only pay into one each tax year.

Does anyone know when (or if) you have to merge these into a single LISA in order to use all the funds to buy your first home? 
It is said at that you can transfer LISA funds between accounts and carry over the minimum 12 month duration needed before you can use it to buy your first property. This suggests you could do this last minute, so long as you account for bank transfer delays and any 25% bonus being carried over for any recent deposits.

I have two LISA with roughly equal interest rates that have both been dropping recently. I am looking to buy a home in the next 1 to 2 year. I just want to check there isn't a disadvantage to keeping both to give me flexibility in case one suddenly plummets to 0% (or fingers crossed one jumps up?). 

With how complex property purchase is I don't what to find out too late something like you can only use one account and any transfers must be made 12 months in advance.

Thanks for any information you have!

eskbanker

Littlebob_wales said:

It is clear from the LISA guide page that you can open one LISA per tax year and have multiple open at the same time so long as you only pay into one each tax year.

Does anyone know when (or if) you have to merge these into a single LISA in order to use all the funds to buy your first home? 

No need to merge, you can use multiple LISAs when buying.

MDMD

eskbanker said:

Littlebob_wales said:

It is clear from the LISA guide page that you can open one LISA per tax year and have multiple open at the same time so long as you only pay into one each tax year.

Does anyone know when (or if) you have to merge these into a single LISA in order to use all the funds to buy your first home? 

No need to merge, you can use multiple LISAs when buying.

Although the conveyancer may charge a separate fee for each account when processing the paperwork.