ISA or regular savings account?

bhoy1976

Hi all,

I've just come from the House Buying, Renting and Selling forum - I was in the wrong place to ask the question and boy did I get some nasties.

Anyway, on a lighter note I am here for your saving advice. I'll try to paint a picture of my circumstances.

My wife and I would like to get on the housing market and realistically, Shared Ownership appears to be our best bet. I'm happy with this as it means paying part toward my own mortgage rather than all to someone elses.

Also, we've got a family now and would like to set up for the future. Having gauged the market in our area and the monthly outgoings, we could manage to get a share in a property meaning that our current rent vs the mortgage + rent would be roughly the same.

With the share prices valued at around £100K in the area we are looking at, our deposit would be around £5K. So we are aiming to save toward that plus out other expenses in as quick a time as possible.

My wife is under 40 and I am over 40 so we have various restrictions on ISA's. My wife was looking more at the LISA and I was looking at the Help to Buy ISA.

Although we would be buying a property that is more than the HTBISA criteria (£250K max) it does have a better interest rate than other ISA's from what I can see. My question is should I even bother with this ISA or just get a regular savings account instead?

I wouldn't qualify for the government bonus so would only be doing it for the better insterest rate. My wife on the other hand would qualify for the LISA.

Anyone have any other advice on saving for a mortgage deposit I am missing?

Many Thanks

Eco_Miser

If the property you buy will meet the conditions for a LISA, then the 25% bonus will swamp any interest considerations, so your wife should go for it.

Since you won't get the HTB bonus, you should save in whichever account(s) pay the highest after tax income (and unless you're a high earner there will be no tax on the first £1000 of interest), which initially will be the Nationwide Flex Direct current account (5% AER) and the various 5% Regular Savers. See here for details.

bhoy1976

Eco_Miser wrote: »

If the property you buy will meet the conditions for a LISA, then the 25% bonus will swamp any interest considerations, so your wife should go for it.

Since you won't get the HTB bonus, you should save in whichever account(s) pay the highest after tax income (and unless you're a high earner there will be no tax on the first £1000 of interest), which initially will be the Nationwide Flex Direct current account (5% AER) and the various 5% Regular Savers. See here for details.

Thank you.

That is a great help.

patientperson

HTB ISA

https://www.saversfriend.co.uk/charts/help-to-buy-ISA