MSE News: 'First cash Lifetime ISA now available – but likely to be only one for now

Malthusian

binaryuniverse wrote: »

Well exactly. This is my only reason for using one, also. I've only just started saving for a deposit, on a house. So I'm unlikely to be able to get one in the next 5-10 years, quite possibly longer. So the more I can put in to one of these things, and the earlier, the better.

If you're aiming to buy a house in 5-10 years then you definitely shouldn't be using a lifetime cash ISA. The fact that your savings are being eroded while the house you will eventually buy is increasing in value means it will definitely be longer than you anticipate, not "quite possibly". Running to stand still means that 5-10 years could easily turn into 7-15.

binaryuniverse

I can't agree with that at all. Whilst I am saving up for a deposit the money has to sit somewhere. Sure, I could put it in account offering better interest rates, but then I wouldn't get the bonus, on buying a property.

eskbanker

Gavin83 wrote: »

It's certainly not a savings account

What do you believe the 'SA' stands for in ISA?

However, I agree that it's a specialist account designed for two specific purposes and hence the penalty for any other use, in much the same way as early withdrawal penalties are applied to fixed-term accounts....

Malthusian

binaryuniverse wrote: »

I can't agree with that at all. Whilst I am saving up for a deposit the money has to sit somewhere. Sure, I could put it in account offering better interest rates, but then I wouldn't get the bonus, on buying a property.

You're ignoring lifetime stocks and shares ISAs.

binaryuniverse

Malthusian wrote: »

You're ignoring lifetime stocks and shares ISAs.

I am certainly ignoring them for now. There's every chance the value of my deposited money could go down. And, although I believe I won't looking for a house until at least 5 years, things could change and I am in a position to get one sooner.

I'm happy with a Cash ISA.