Help to Buy + LISA advice

Zapperzook

Hello,

Some background information: I am saving up for a deposit for when I buy my first house (I am not planning on buying in the next 12 months), and I am thinking about opening a cash LISA with Skipton, as I do not have much financial experience and cash ISAs are easier to understand for me.
I also currently hold a Help to Buy ISA with Halifax, which I opened in May 2016. This account currently holds ~£2200. In addition to this, I have ~£12k in a current account, and in November of this year I will come into a ~£40k inheritance of which I am currently a beneficiary.
However, I will be off to university in September, and since my maintenance loan is low (not even enough to cover rent) I will need to keep some of this money for living.

With all that out of the way, my question is: do I open this LISA alongside my Help to Buy, or do I close my HtB and transfer its contents into a LISA?

Any other advice regarding saving would also be appreciated!

eskbanker

Zapperzook wrote: »

my question is: do I open this LISA alongside my Help to Buy, or do I close my HtB and transfer its contents into a LISA?

Up to you - you can have both open but can only get the 25% government bonus on one or the other when buying your first property. Since the LISA has a larger annual contribution limit, many in your shoes will use that for the bonus, maxing it out with £4K/year, but retain any excess savings in a HTB to take advantage of the (typically) better interest rate there.

However, it's not clear why you'd have £12K in a current account but less than the full amount in a HTB ISA, is the current account paying better interest?

You could do worse than starting your research on savings options at https://www.moneysavingexpert.com/savings/which-saving-account

Zapperzook

eskbanker wrote: »

Up to you - you can have both open but can only get the 25% government bonus on one or the other when buying your first property. Since the LISA has a larger annual contribution limit, many in your shoes will use that for the bonus, maxing it out with £4K/year, but retain any excess savings in a HTB to take advantage of the (typically) better interest rate there.

However, it's not clear why you'd have £12K in a current account but less than the full amount in a HTB ISA, is the current account paying better interest?

First of all, thank you for your advice.
Secondly, the reason I have less than the full amount in my HtB is that I completely forgot I had opened it until a couple of months ago!! :eek: My current account has pitiful interest right now, so I am transferring what I can to my HtB, and will look into other savings options! I am waiting to get confirmation of my offer from uni so I can open a student acct, from what I've read Santander seem to be the best choice for my current financial position.

Thanks again!

kidmugsy

If I were you I would consider holding back on the LISA until the inheritance is in your hands. It would be vexing if the inheritance were delayed and you suddenly needed money that you had just locked up in the LISA.

Wildsound

Zapperzook wrote: »

Hello,
and in November of this year I will come into a ~£40k inheritance of which I am currently a beneficiary.

Is this inheritance going to include any residential property? If so, that will void your ability to save into either a HTB or LISA. If it's just cash and other assets, then it won't.

Alexland

Wildsound wrote: »

Is this inheritance going to include any residential property? If so, that will void your ability to save into either a HTB or LISA. If it's just cash and other assets, then it won't.

Most likely proceeds from sale within the estate in which case the OP would still be a FTBer.

Alex