Question about Help to Buy ISA and LISA
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blissfulpanda78
Posts: 6 Forumite
Hi everyone!
Apologies, this is going to be an essay!!
I have a question regarding the above mentioned savings accounts as I'm looking to possibly buy my own home in the future (currently renting and want out). Having looked at the potential costs for almost everything, it does seem quite daunting and wondered whether opening both a H2B ISA and a LISA would be worth it?
I ask this because I'm already in the process of saving, but my current ISA has a slightly pants interest rate and I want to make my money work a little harder. At the start of the year, I had a little system where I'd put at £150-£200 away in the main ISA and anything left over at the end of the month would go into another savings account in case of emergency or if I was short on money. I'm quite sensible when it comes to spending anything (only necessities or birthdays/christmas/mother's/father's day).
My only problem currently right now is the amount of money I can put away into the main savings account, as it all relies on how much I get paid. Recently, it's been less than I'd like (for example £100), but I'm still trying hard to squirrel something aside.
Any help and/or advice (e.g. best banks/saving accounts etc) and anything else regarding this sort of thing would be great, as it will at least give me a leg to stand on!!
Apologies, this is going to be an essay!!
I have a question regarding the above mentioned savings accounts as I'm looking to possibly buy my own home in the future (currently renting and want out). Having looked at the potential costs for almost everything, it does seem quite daunting and wondered whether opening both a H2B ISA and a LISA would be worth it?
I ask this because I'm already in the process of saving, but my current ISA has a slightly pants interest rate and I want to make my money work a little harder. At the start of the year, I had a little system where I'd put at £150-£200 away in the main ISA and anything left over at the end of the month would go into another savings account in case of emergency or if I was short on money. I'm quite sensible when it comes to spending anything (only necessities or birthdays/christmas/mother's/father's day).
My only problem currently right now is the amount of money I can put away into the main savings account, as it all relies on how much I get paid. Recently, it's been less than I'd like (for example £100), but I'm still trying hard to squirrel something aside.
Any help and/or advice (e.g. best banks/saving accounts etc) and anything else regarding this sort of thing would be great, as it will at least give me a leg to stand on!!
0
Comments
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Definately worth having both.
Start of the H2B with the max £1200.
2.5% not great but no withdrawal fee if you need funds for an emergency. Though if your current savings is giving more, might be better sticking with them?
If you don't think you'll need to access money for an emergency, dump as much into the LISA.
Anything else spare, put in the LISA, the 25% is added monthly so the interest can start compounding straight away, though 1.1-1.4% its not a lot but as the account needs to of been opened for a year before you can buy, might as well have one opened anyway.
Don't know how much savings you got, but if you hit the £4k yearly quota for the LISA, you can then still drip feed monthly into the H2B or your other savings account if it gives a better return.
Depending how much savings you have and its available to you, could look at Nationwides flexdirect account, 5% on anything up to £2,500 for a year.0 -
Definately worth having both.
Start of the H2B with the max £1200.
2.5% not great but no withdrawal fee if you need funds for an emergency. Though if your current savings is giving more, might be better sticking with them?
If you don't think you'll need to access money for an emergency, dump as much into the LISA.
Anything else spare, put in the LISA, the 25% is added monthly so the interest can start compounding straight away, though 1.1-1.4% its not a lot but as the account needs to of been opened for a year before you can buy, might as well have one opened anyway.
Don't know how much savings you got, but if you hit the £4k yearly quota for the LISA, you can then still drip feed monthly into the H2B or your other savings account if it gives a better return.
Depending how much savings you have and its available to you, could look at Nationwides flexdirect account, 5% on anything up to £2,500 for a year.
Thank you for your reply!
2.5% is a ton better than what I'm getting from my current ISA at this moment in time (0.60% so it's struggling to gain something relatively decent, but it's better to start with this than with nothing!)
With regards to these, would you happen to know how much I'd have to put into each H2B/LISA per month? I only put away what I know I can afford to without putting payments towards the bills at risk. My main ISA gets the £150-£200 and the spare savings account I have just gets the dregs of anything I have left over.0 -
Not sure what you mean by "how much I'd have to put into each H2B/LISA per month" - you don't have to put anything in these, so how much you put in is entirely up to you and your circumstances, although HTB is capped at £200 per month (after month one) and LISA at £4K per year.blissfulpanda78 wrote: »With regards to these, would you happen to know how much I'd have to put into each H2B/LISA per month? I only put away what I know I can afford to without putting payments towards the bills at risk. My main ISA gets the £150-£200 and the spare savings account I have just gets the dregs of anything I have left over.
Just in case you haven't already spotted it, you can't use both a HTB ISA and a LISA (without withdrawal penalties) towards a first-time property purchase, it's one or the other in order to take advantage of the 25% government bonus....0 -
Not sure what you mean by "how much I'd have to put into each H2B/LISA per month" - you don't have to put anything in these, so how much you put in is entirely up to you and your circumstances, although HTB is capped at £200 per month (after month one) and LISA at £4K per year.
That was pretty much it. If I can put away as much as I can, then I won't find myself struggling to save money every month if there was an amount I had to put away.Just in case you haven't already spotted it, you can't use both a HTB ISA and a LISA (without withdrawal penalties) towards a first-time property purchase, it's one or the other in order to take advantage of the 25% government bonus....
Yep, I had noticed that after doing a little light reading earlier! One for a mortgage deposit and the other for a mortgage and home deposit
That was pretty much it. If I can put away as much as I can, then I won't find myself struggling to save money every month if there was an amount I had to reach0
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