Child Trust Fund to Lifetime Isa

My grandsons Child Trust Fund has just matured.  I originally transferred it into a Foreign and Colonial stakehoder trust fund which now seems to be a BMO fund and now worth 11,500 pounds.  If he were to start a Lifetime ISA  with this years 4000 maximum should he leave the remaining  7,500 in the Fund until can make next two Lifetime Isa contributions.  Advice gratefully received

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  • eskbanker
    eskbanker Posts: 29,765
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    Much will depend on when the money is likely to be needed - if the intention is to use a cash LISA with a view to buying a first property within a few years then the residual £7.5K ought not to be left invested, but if he's looking at a S&S LISA with a view to (very) long term retirement planning then that would be different....
  • LizMac42
    LizMac42 Posts: 42
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    It would be for a first property but its likely to be about 5 years before he can think about looking.  If you can only put £4000 in Lifetime in first year - he would hope to use the rest to fund 2 more years.  Problem is where to put that money until he can do.   It is still earning as its in a stocks and shares fund.   Savings accounts seem to be a 'no no' these days.
  • eskbanker
    eskbanker Posts: 29,765
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    LizMac42 said:
    It would be for a first property but its likely to be about 5 years before he can think about looking.  If you can only put £4000 in Lifetime in first year - he would hope to use the rest to fund 2 more years.  Problem is where to put that money until he can do.   It is still earning as its in a stocks and shares fund.   Savings accounts seem to be a 'no no' these days.
    There's no doubt that savings rates are low just now, but that doesn't change the fundamental truth that investing entails risk of capital loss, and the shorter the term involved the higher this risk is....
  • MX5huggy
    MX5huggy Posts: 6,803
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    Put the rest in a ordinary ISA (cash or S&S) of his choice. 
  • LizMac42
    LizMac42 Posts: 42
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    Thanks MX5huggy - I think thats what I shall suggest - though 4k this year and 4k next April will take up the major amount so probably not S&S.
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