20K to put in Lifetimeisa

IloveElephants · 22 January 2020 at 10:16AM

Hi everyone,

I would like some advice please, I am 36 years old, I currently have no mortgage and have 20k sitting in a standard savings account with TSB earning little, I have been told by friends put it in a lifetime ISA and gain some interest on it, as I do not need the money I would like to make it work for me.

My question is what is the best bank that does Lifetime ISAs? I would like a bank that is well known like TSB Natwest Lloyds etc.. that have their presence on a high street for my peace of mind. And once I open a Lifetime ISA can I simply put 4k in straight away and after April this year another 4k?

Thank you all very much for taking the time to read my question

eskbanker · 22 January 2020 at 11:27AM

IloveElephants wrote: »

I am 36 years old, I currently have no mortgage and have 20k sitting in a standard savings account with TSB earning little, I have been told by friends put it in a lifetime ISA and gain some interest on it, as I do not need the money I would like to make it work for me.

A Lifetime ISA may be good for you, but much depends on what your plans are for the money.

If you've never owned a property but intend to in the foreseeable future then a LISA will help with your deposit, and a cash LISA would suit this purpose.

If your money isn't needed until you're 60 then a stocks and shares LISA will work well for you in boosting retirement funds.

IloveElephants wrote: »

My question is what is the best bank that does Lifetime ISAs? I would like a bank that is well known like TSB Natwest Lloyds etc.. that have their presence on a high street for my peace of mind.

Sorry, you're going to be disappointed then, as no high street banks offer Lifetime ISAs.

Cash LISAs are such a niche product that they're only offered by three building societies (Skipton, Newcastle, Nottingham), an online-only bank (Paragon) and an app (Moneybox, which has the best interest rate): https://moneytothemasses.com/saving-for-your-future/compare-the-best-and-cheapest-lifetime-isa#title-anchor-15

There are a few more S&S LISA providers if that's what you want: https://moneytothemasses.com/saving-for-your-future/compare-the-best-and-cheapest-lifetime-isa#title-anchor-14

IloveElephants wrote: »

And once I open a Lifetime ISA can I simply put 4k in straight away and after April this year another 4k?

Yes.

https://www.moneysavingexpert.com/savings/lifetime-isas/

IloveElephants · 22 January 2020 at 11:43AM

Hi Eskbanker,

Thank you for your kind reply,

"Sorry, you're going to be disappointed then, as no high street banks offer Lifetime ISAs." Oh I never knew that, Ok Ive been looking at Hargreaves Landsdown and Nottingham building society for a LISA

A Lifetime ISA may be good for you, but much depends on what your plans are for the money.

"If you've never owned a property but intend to in the foreseeable future then a LISA will help with your deposit, and a cash LISA would suit this purpose."

"If your money isn't needed until you're 60 then a stocks and shares LISA will work well for you in boosting retirement funds"

Yes thank you for the above, I have no property at this moment, I would like to maybe use the 20k in 5 years time fingerscrossed if I meet the right lady in my life and then I can use the deposit to buy a house but until then Im happy to lock it safe.

From your reply it looks like a cash LISA from Nottingham building society would be more suitable for me ?

Thanks once again

eskbanker · 22 January 2020 at 11:56AM

IloveElephants wrote: »

I have no property at this moment, I would like to maybe use the 20k in 5 years time fingerscrossed if I meet the right lady in my life and then I can use the deposit to buy a house but until then Im happy to lock it safe.

From your reply it looks like a cash LISA from Nottingham building society would be more suitable for me ?

If you plan to use the money for a property purchase in about five years time then yes, a cash LISA would seem appropriate, as long as you recognise that accessing the money for any other purpose (before 60) would result in withdrawal penalties being payable, which not only reverse the bonus but also reduce the capital, i.e. you'd get out less than you paid in.

Personally I'd use Moneybox, for the best rate, but if branch access is important to you, and there's a Nottingham one within reach, then they are the second best....

IloveElephants · 22 January 2020 at 12:09PM

Eskbanker, you are a very good person, I really appreciate your kindness

Yes I understand the penalties of accessing the money and the terms,

Yes I will read up on Moneybox, for me branch access just gives me peace of mind if I have an issue I can hopefully walk in a branch and talk to someone I hope, where as online their website could disappear and you will panic then.

Thank you my friend.

IloveElephants · 22 January 2020 at 12:11PM

Can I just ask if I open an Cash LISA with Moneybox or Nottingham building society this weekend and deposit 4k straight away how much Interest roughly will I receive in April at the end of the tax year? Then a day later add another 4k in?

Thank you

oli356 · 22 January 2020 at 1:39PM

IloveElephants wrote: »

Can I just ask if I open an Cash LISA with Moneybox or Nottingham building society this weekend and deposit 4k straight away how much Interest roughly will I receive in April at the end of the tax year? Then a day later add another 4k in?

Thank you

I opened a LISA with Moneybox the other week and deposited £4k, app says I'm earning £0.1524 interest a day (1.4 aer). So what, £56 a year with 4 grand in.

eskbanker · 22 January 2020 at 2:12PM

IloveElephants wrote: »

Can I just ask if I open an Cash LISA with Moneybox or Nottingham building society this weekend and deposit 4k straight away how much Interest roughly will I receive in April at the end of the tax year?

As above, about 15p/day initially on £4K (in a 1.4% account) but closer to 19p/day once the 25% bonus is added in early March. If the bonus was paid on 1 March then 36 days @ 15p and then the same again @ 19p would earn you about £12.24 by the end of the tax year, although you'd need to check the Ts & Cs of the account you choose to see when interest is actually paid.

IloveElephants wrote: »

Then a day later add another 4k in?

Your average balance for the full 2020/21 tax year would be close to £10K after bonuses, so you'd earn about £140 for the full year.

Corresponding figures for a 1.25% account will of course be about 10% lower.

IloveElephants · 22 January 2020 at 2:38PM

Thanks Oly

its good how you can check the
app to see how much your earning daily or weekly

IloveElephants · 22 January 2020 at 2:39PM

Thanks ESK

I will open an Account tomorrow and deposit 4k in to begin with

Thank
you

IloveElephants · 22 January 2020 at 3:09PM

Im wondering on the Money box app if I deposit my £4k in the stocks and shares ISA then select "adventures" High risk investing do you think this is a bad idea if I have no intention of touching the money because in the long term it will hopefully grow?

Or shall I play it safe and just open the Lifetime ISA and simply deposit 4k in and after the tax year add another 4k ?

Thank You

20K to put in Lifetimeisa

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