Should I keep my LISA if I might be moving abroad? + 50k in premium bonds, where to put it? 4 November 2022 at 12:43AM in Savings & investments 6 replies 240 views

MrDionysus

I have 50k in premium bonds and 5k in a S&S LISA.

Very real possibility of me moving abroad in 2 or 3 years. If I do then the LISA becomes somewhat obsolete if I can't use it to buy a home… I do not want to wait until I am 60 to access it. Ideally I'd buy and rent out if I was living abroad, but don't think that is allowed.

Unsure what to do with the rest of my savings. I want to take advantage of the bad economy (the next few months would seem like a good time to buy more shares), but I don't want to put too much into my LISA if I won't be in the UK to buy a house. But if I don't, isn't that a huge missed opportunity?

My thinking is put 50k into a one-year fixed saving account and feed the interest into the LISA. For some reason I feel better about putting interest-gains into the LISA than my own money. Small potatoes of course, but right now it is all that feels safe.

What would you do on my position?

callum9999

If you don't want to buy a house and don't want to wait until retirement to access the money, what reason could you possibly have for keeping the LISA, let alone add more to it?

In your position I would keep using the LISA until you're ineligible to add more as I think the bonus makes it a great account, but if you don't want it then either leave it alone and don't add more or pay the penalty and close it. If you want to invest more money then open an easy access S&S ISA.

MrDionysus

callum9999 said:

If you don't want to buy a house and don't want to wait until retirement to access the money, what reason could you possibly have for keeping the LISA, let alone add more to it?

In your position I would keep using the LISA until you're ineligible to add more as I think the bonus makes it a great account, but if you don't want it then either leave it alone and don't add more or pay the penalty and close it. If you want to invest more money then open an easy access S&S ISA.

I do want to buy a house. I just don't know if I could with a LISA if I was living abroad.

callum9999

MrDionysus said:

callum9999 said:

If you don't want to buy a house and don't want to wait until retirement to access the money, what reason could you possibly have for keeping the LISA, let alone add more to it?

In your position I would keep using the LISA until you're ineligible to add more as I think the bonus makes it a great account, but if you don't want it then either leave it alone and don't add more or pay the penalty and close it. If you want to invest more money then open an easy access S&S ISA.

I do want to buy a house. I just don't know if I could with a LISA if I was living abroad.

Oh, I thought you knew it wasn't allowed. No you can't buy abroad.

Unless you're desperate for the money, if I were you I'd just look at it as another source of retirement income.

MrDionysus

callum9999 said:

MrDionysus said:

callum9999 said:

If you don't want to buy a house and don't want to wait until retirement to access the money, what reason could you possibly have for keeping the LISA, let alone add more to it?

In your position I would keep using the LISA until you're ineligible to add more as I think the bonus makes it a great account, but if you don't want it then either leave it alone and don't add more or pay the penalty and close it. If you want to invest more money then open an easy access S&S ISA.

I do want to buy a house. I just don't know if I could with a LISA if I was living abroad.

Oh, I thought you knew it wasn't allowed. No you can't buy abroad.

Unless you're desperate for the money, if I were you I'd just look at it as another source of retirement income.

I think there is some miss communication. To be clear, I do not want to use the LISA to buy abroad. I just don't see it being feasible to buy somewhere in the UK using a LISA while I am based abroad (or am I wrong?).

fwor

The government website page (i.e. .gov.uk) on Lifetime ISA should answer all of your questions.

It needs to be read carefully. For example the words "You can use your savings to help you buy your first home" should be taken literally.

Similarly the words on whether you are permitted to make payments in if you are not a UK resident, and whether you can receive the bonus if you can't make payments in.

eskbanker

MrDionysus said:
I just don't see it being feasible to buy somewhere in the UK using a LISA while I am based abroad (or am I wrong?).

I don't believe that the LISA rules themselves actually prohibit UK purchases by non-UK residents, but, as you recognised earlier, the idea of buying a property remotely and immediately renting it out isn't a flyer because of the occupation requirement:

On completion of the purchase, the Lifetime ISA investor must occupy the property as their only or main residence.

It must always be the investor’s intention to occupy their property as their only or main residence when they are able to.

https://www.gov.uk/guidance/lifetime-isa-withdrawals-for-a-first-time-residential-purchase