Lifetime ISAs guide

eskbanker

Guru86 wrote: »

Guru86 wrote: »

Ok about to open a LISA looking at Hargreaves Lansdown rather than cash ISA. Paying the minimum £25 a month as a little extra as can't put anymore in work pension - plan to increase over time.

I've looked at Funds and think the vanguard lifestragety 80% - I'm worried about the risk as never done s&s before but due to length of time money going to be in there think this is best route as time to recover if dips. This the right idea?

Also when I open the LISA with them do I deposit the first monthly payment then assign the fund, then do I have to assign the money each month to the fund or will it do it automatically?

Any advice?

Investing is generally regarded as a better bet than cash-based saving when intended for the long term, and yes, you can't go far wrong with a leading global multi-asset fund like VLS80 as a starting point.

I don't have any direct experience of HL but believe that they offer a £25 monthly regular savings option which would take care of everything for you once you'd made the decision about the fund.

graced17

Hi


I'm hoping to open a lifetime ISA with a view to using it to buy my first house.


At the moment, as far as I'm aware, it is only Skipton that are offering the non stocks and shares LISA but the interest rate being offered is only 0.5%. I am aware that after the 2017/18 tax year, there would be a penalty for withdrawing the money. So, am I better off opening with Skipton now, settling for the low interest rate (and possibly withdrawing it before the end of the tax year if a better offer comes up). I am worried that if a better offer doesn't come up in time, I will be stuck with Skipton and unable to change without penalty at a later date.


Or should I just hold out until another provider comes about?


Hope this makes sense... thanks in advance!

Woodaaay

just be careful that in the fine print for the Skipton LISA it says they reserve the right to remove the facility to transfer into the LISA so there is a risk that if you wait, you wont be able to do it

eskbanker

Don't hold your breath waiting for another provider, there's no sign of any interest in the market, as per http://www.moneysavingexpert.com/news/savings/2017/06/first-cash-lifetime-isa-now-available-but-its-likely-to-be-the-only-one-for-a-while

The only reason to open one now is to start the clock ticking, in that you have to have the account open for a year before you can use it for a property purchase - if you're not likely to be buying before March 2019 then you can just keep your money elsewhere (earning more than 0.5%) and open a LISA closer to the end of the tax year when it may be clearer what the options are.

Chris_Dean

Foresters Friendly Society have just launched a product with a 1.75% annual interest rate bonus plus extra with profits bonus when you withdraw the funds. that seems a better deal than cash...wonder who else will be launching.

Arthurian

Chris_Dean wrote: »

Foresters Friendly Society have just launched a product with a 1.75% annual interest rate bonus plus extra with profits bonus when you withdraw the funds. that seems a better deal than cash...wonder who else will be launching.

I got quite excited for a moment, then realised Skipton is cash, Foresters is stocks and shares.

EDIT: from their brochure "The money you put into your Stocks & Shares LISA, together with the government bonus,
is invested in our With Profits Order Insurance Fund, which aims to provide growth over
5 years or more. An annual and a final bonus may be added to your LISA by Foresters.
The value of these bonuses depend on how much profit the fund makes. The addition of
these bonuses is not guaranteed."

eskbanker

Chris_Dean wrote: »

Foresters Friendly Society have just launched a product with a 1.75% annual interest rate bonus plus extra with profits bonus when you withdraw the funds. that seems a better deal than cash...wonder who else will be launching.

As the previous poster has correctly pointed out, the Forester LISA isn't a cash one (which is the context of the comment about not holding breath) - a quick look at the online key facts and brochure reveals info about annual charges of no less than 1.25% but nothing about "1.75% annual interest rate bonus", where did you see this?

[Deleted User]

How do they determine/you prove the opening date?? Is a statement enough?

I opened an investment LISA on 6th April (Nutmeg).

Opened a Cash LISA 6th June (was on Mailing List).

Will transfer the Investment ISA to Skipton when I sort the forms out. Tempted to transfer it out, if somebody offers a better rate.

But, Skipton will declare my opening date as 6/6/17. Given that nutmeg will be closed, that kills my 6/4/17 product. If I then moved it to, say, Barclays - wouldn't they think my opening date is 1/11/17 or whatever?

Thinking for those buying imminently (I'm October next year), it might be better to keep it in one place than scrabble around for extra interest??? (Despite my instinct normally being to move for even 0.01%!)

Ed-1

Somerset_La_La_La wrote: »

How do they determine/you prove the opening date?? Is a statement enough?

I opened an investment LISA on 6th April (Nutmeg).

Opened a Cash LISA 6th June (was on Mailing List).

Will transfer the Investment ISA to Skipton when I sort the forms out. Tempted to transfer it out, if somebody offers a better rate.

But, Skipton will declare my opening date as 6/6/17. Given that nutmeg will be closed, that kills my 6/4/17 product. If I then moved it to, say, Barclays - wouldn't they think my opening date is 1/11/17 or whatever?

Thinking for those buying imminently (I'm October next year), it might be better to keep it in one place than scrabble around for extra interest??? (Despite my instinct normally being to move for even 0.01%!)

Since transferred ISAs are classed as the same ISA for HMRC reporting periods, the opening date reported is always the opening date of the first account opened which is transferred over with the ISA in the back end process.

[Deleted User]

Thanks, that's good to hear.

I don't trust banks and their technology - after Barclays made an almighty ***k-up transferring my H2B ISA last year.

As the date is passed in the backend process as you say, hopefully nothing like that would happen again!!

Due to Skipton's possible 'no transfer' clause, I'll move my H2B ISA ASAP too I think!!