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Use LICA for first time house buy, or for retirement?

edited 30 November -1 at 1:00AM in Savings & Investments
3 replies 509 views
storyglory007storyglory007 Forumite
2 Posts
edited 30 November -1 at 1:00AM in Savings & Investments
Hi everyone. I am hoping to get some good informed opinions about what to do with my LICA saving.

I am currently in the process of purchasing my first property with my partner and have been saving in Help to buy and lifetime ISA's for a few years now. The problem is that I have only now come to the conclusion that I may be doing the wrong thing using my lifetime ISA for this as once I have used it then I can not use it again for retirement :(
I moved my Help to buy ISA to a help to buy ISA last year knowing that I could then put more money in per tax year. Once my deposit is needed to be paid I will be looking at having around £3300 worth of help from the government. Though I am wondering if perhaps I should fund this myself so to keep my Lifetime ISA open. I do have this cash available though it would eat into my savings. Though I am thinking I would probably receive more cash boost saving for a much longer for retirement instead.
I am 7 years older than my partner and therefore can reasonably think that I will retire 7 years before her, so see now that maybe it is her we should of looked at making her help to buy ISA being moved into a Lifetime ISA and using this for our house purchase deposits.
We have spoken about her making a Lifetime ISA for her and both putting payments into it to save for both of our retirements though it seems that that money would only be able to be unlocked when she retires.

So I am looking for your opinions on what I should do. I am not meaning to sound greedy but want a bit more bang for my buck. We are not well off in any terms at all. I have worked very hard and done a hell of allot of overtime hours at work to save the money I have and greatly appreciate the help of the government saving scheme, but need to get some thoughts on if I am doing the correct thing using my Lifetime ISA now.

Thank you. Please respond to this when reading.

Ryan

Replies

  • eskbankereskbanker Forumite
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    The problem is that I have only now come to the conclusion that I may be doing the wrong thing using my lifetime ISA for this as once I have used it then I can not use it again for retirement :(
    Fortunately the conclusion you reached is incorrect, in that there's nothing stopping you from using your LISA for a first-time property purchase and then continuing to use it (or a new one) for retirement saving. Therefore it's not a problem and the rest of your post is moot....
  • Wow. Thank you so much.

    I had it certain in my head that I had read that the 25% bonus could only be used once. I have been back on the sight and read the LICA information again. I totally do not remember reading that a year ago when I moved to my LICA. Thank you for your reply.

    Ryan
  • eskbankereskbanker Forumite
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    Just to be clear, with a LISA it's not a case of 'using the bonus' as such - the bonuses are added as you go, shortly after each contribution is made.

    All of the money can be withdrawn at 60 but anything taken out before that will incur a penalty of 25% of the amount withdrawn, unless it's for a qualifying first-time property purchase, so there's no meaningful differentiation between the contributions and the bonuses, they're all mixed up together in one big pot....
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