Cash LISA or Savings Account

sensible2023

My young adult child wants to save for a property deposit of about 40k over next three years and has 10k saved already in their current account and can start to save £750 a month while they live at home. They don't want to invest in stocks and shares and don't need to have instant access to savings. What should they do?

eskbanker

A cash LISA is an obvious answer but is constrained to £4K per tax year, so they should get the 2022/23 allowance filled up before April and then keep going from there.

Beyond that, a combination of fixed term and regular savings accounts should optimise total return:

https://www.moneysavingexpert.com/banking/savings/which-saving-account-old/
https://www.moneysavingexpert.com/savings/best-regular-savings-accounts/
https://www.moneysavingexpert.com/savings/savings-accounts-best-interest/
https://www.moneysavingexpert.com/savings/best-cash-isa/

sensible2023

eskbanker said:

A cash LISA is an obvious answer but is constrained to £4K per tax year, so they should get the 2022/23 allowance filled up before April and then keep going from there.

Beyond that, a combination of fixed term and regular savings accounts should optimise total return:

Thank you for quick response. I thought that might be the best course of action but I wanted to check before advising them and getting it wrong! 

Albermarle

Probably a good idea to familiarise yourself with the LISA rules.
Lifetime ISA (LISA): how they work & best buys - Money Saving Expert