Help to Buy and LISA - Stuck between 2

F0xMoneySaving

Hello,

Please can I seek advise. I currently have maxed out my help to buy ISA, which I set up just before the government ended the scheme when I was a student at university. Since then I have contributed more to this ISA then necessary (was not as financially savvy as before).

I since learned of the LISA and the benefits that brings as a First Time Buyer. My original plan was to move across my help to buy savings into my LISA, with the view to look to buy first home in next 2 to 3 years.

However, with the current changes in budget to ISA allowances. I am now second guessing if what I am doing is right? And if I should just use my help to buy towards my first home and use the LISA separately for retirement?

Any advice is deeply appreciated.

eskbanker

I don't think anything announced today materially affects your situation, given that both HTB and Lifetime ISAs already had contribution limits way smaller than the allowances for other ISA types, even after reduction in 2027.

There is a consultation next year about replacing the LISA but obviously far too early to say what that'll look like.

For now, open a LISA if you haven't already, funded with a token quid or two, just to keep that option open, and keep an eye on whether it'll be worth transferring £4K of HTB money into it before the end of the tax year.