Maximising LISA Bonus

hking03

Getting a little confused about how to maximise the Government bonus for the LISA.

So, I should add the maximum of £4k per year, but as a lump sum or can I build up to it monthly? I assume putting in £4k a year on the first day every year would be best, especially as they say the bonus is calculated monthly... but no one actually says this specifically.

Would it therefore be just as valid for me to put in £334 a month for 12 months? Would the Government still give me the maximum bonus if by the end of the 12 month period there was £4k in there?

Ed-1

hking03 wrote: »

Getting a little confused about how to maximise the Government bonus for the LISA.

So, I should add the maximum of £4k per year, but as a lump sum or can I build up to it monthly? I assume putting in £4k a year on the first day every year would be best, especially as they say the bonus is calculated monthly... but no one actually says this specifically.

Would it therefore be just as valid for me to put in £334 a month for 12 months? Would the Government still give me the maximum bonus if by the end of the 12 month period there was £4k in there?

You get 25% bonus on anything you've paid in in the previous month.

£4,000 x 25% = £1,000

£333.33 x 25% = £83.33. £83.33 × 12 = £999.96. I don't know whether they'll top up the extra 4p.

It doesn't matter which way you do it.

Slappermum

The government will give you the bonus within about a month and a half of you paying into the LISA. If you do 12 payments you'll get 12 bonuses. If you do it at once you'll get one £1000 payment into your LISA by the government.

The only difference is if you pay it all in at the start of the tax year you'll accrue more interest on your balance.

masonic

hking03 wrote: »

I assume putting in £4k a year on the first day every year would be best, especially as they say the bonus is calculated monthly... but no one actually says this specifically.

If you are referring to a cash LISA, generally putting £4k a year in towards the end of each the tax year would be best, since you can earn a higher rate of interest outside of the LISA.