Lump sun in Lifetime Stock & Shares ISA now or not?

Isibarum

Hi all,
I am going to give a few thousand pounds to my daughter as a gift (with her normal savings, she would still be under the 20K limit for ISAs). This is a portion of a small inheritance I have received and whilst I don't want to give it to her with strings attached, I would like it to make a difference in her life in the medium or long term (and she is very good with money so she does agree!).
She has had a Stock & Shares Lifetime ISA for the last 6 or 7 years but she is only 25 and, whilst she would like to settle, there are a lot of moving parts in her life at the moment. I wouldn't be surprised if she went to live abroad for a few years. The Lifetime ISA was a perfect vehicle to put this money long term and, at 18 was more appealing than a personal pension...until the review was announced ! So, now my question is: is it wise to put this money into the Lifetime ISA in the next few months or would it be better to park them somewhere else? If so, where?

dunstonh

So, now my question is: is it wise to put this money into the Lifetime ISA in the next few months or would it be better to park them somewhere else?

What is it that makes you think the LISA may not be suitable?  - it is unclear from your post why you think it may not be.

eskbanker

Isibarum said:

Hi all,
I am going to give a few thousand pounds to my daughter as a gift (with her normal savings, she would still be under the 20K limit for ISAs). This is a portion of a small inheritance I have received and whilst I don't want to give it to her with strings attached, I would like it to make a difference in her life in the medium or long term (and she is very good with money so she does agree!).
She has had a Stock & Shares Lifetime ISA for the last 6 or 7 years but she is only 25 and, whilst she would like to settle, there are a lot of moving parts in her life at the moment. I wouldn't be surprised if she went to live abroad for a few years. The Lifetime ISA was a perfect vehicle to put this money long term and, at 18 was more appealing than a personal pension...until the review was announced ! So, now my question is: is it wise to put this money into the Lifetime ISA in the next few months or would it be better to park them somewhere else? If so, where?

Just to be clear, is she anticipating using a LISA for retirement planning or for her first property purchase?  The review announced in the recent budget only encompassed a potential successor product to LISA specifically for first time buyers, rather than the long term use.

Although you do refer to long term, it's unclear why short term life choices about settling or living abroad would relate to retirement planning?

Isibarum

dunstonh said:

So, now my question is: is it wise to put this money into the Lifetime ISA in the next few months or would it be better to park them somewhere else?

What is it that makes you think the LISA may not be suitable?  - it is unclear from your post why you think it may not be.

So far, she has contributed monthly but this time, she would put the full allowance this year and probably the full allowance next year in lump sums. This would be boosting her LISA substantially, which would be good if LISAs remained the same but we are now told they will change. In other words: is it wise to invest when there is uncertainty?

eskbanker

Isibarum said:

dunstonh said:

So, now my question is: is it wise to put this money into the Lifetime ISA in the next few months or would it be better to park them somewhere else?

What is it that makes you think the LISA may not be suitable?  - it is unclear from your post why you think it may not be.

So far, she has contributed monthly but this time, she would put the full allowance this year and probably the full allowance next year in lump sums. This would be boosting her LISA substantially, which would be good if LISAs remained the same but we are now told they will change. In other words: is it wise to invest when there is uncertainty?

My point was that we haven't been told that S&S LISAs will change, but there's no harm in waiting until closer to the end of the 2025/26 tax year before committing this year's allowance if it hasn't already been used, in case the direction of travel is clearer, assuming the consultation has been started by then.

Isibarum

eskbanker said:

Just to be clear, is she anticipating using a LISA for retirement planning or for her first property purchase?  The review announced in the recent budget only encompassed a potential successor product to LISA specifically for first time buyers, rather than the long term use.

Although you do refer to long term, it's unclear why short term life choices about settling or living abroad would relate to retirement planning?

Good questions! I think she will use it for a deposit on a property if she remains in the UK (but will she?). As far retirement planning is concerned, I am wondering if it might not be a better idea to start a personal pension with that money, instead of putting it into a LISA with an uncertain future.