What to do with LISA after house purchase?

Yorkie006

Greetings,

had a LISA account for several year. Completed a house purchase couple of years ago.

Made the last £4000 payment but house purchase completed before the government bonus was paid. So I have £1000 (+ interest) sitting in an account I have no use for.

What would you do with the LISA now? Can't take the money out without losing 25% of it. Have no intention of making further contributions.

Do I bite the bullet and take the money out or keep it as is until I'm old enough to take it out for retirement (decades in the future)? It's earning meagre interest because I already used all the good 'new customer' options (Plum, Chip, Moneybox etc) in the past. There's very little choice now and the % rates are a lot lower than for normal saving accounts. I suspect the choice will be even more limited once the new First time buyer ISA launches in 2028.

Thanks for advice.

eskbanker

If you have decades to go until you're 60 then transfer it into a S&S LISA and get it invested rather than leaving it languishing in cash savings form…

clairec666

I understand your reluctance to withdraw and face a penalty, but in your situation it's not such a bad option.

You put in £4000, and you got your £4000 back. If you withdraw now surely you'll get £750 back not £1000, which feels unfair but at least you got your original investment back.

friolento

I would also suggest the S&S LISA route, with the lowest fee provider you can find. But have you checked with your LISA provider, and/or your Solictor, whether you are still entitled to withdraw the full amount?

masonic

https://forums.moneysavingexpert.com/discussion/comment/82120820#Comment_82120820

The OP has been a homeowner for a couple of years. It will not be possible to withdraw the full amount.