Lifetime ISA VS Help to buy ISA

Awiseowlwannabee · 2 December 2019 at 5:40PM

Hi

I have a confusing choice to make concerning the fate of my help to buy isa, given the avaialble options of a lifetime isa there now are in relation to buying my first property.

I have a Help to buy for a good few years and it is close to maxing out (it sits at around (10.5k), I was considering my options in regard to switching to a LISA account from april next year. My choices are pretty much as follows...

1. Stop the help to buy (and leave whatever cash is in the account ticking over with the interest) and switch my savings to a LISA for my first home (this seems to have the benefit of allowing me to open a separate cash isa which I cant right now due to restrictions on the H2B).

2. Stop the help to buy Isa in April and shuttle all the money from that account into the LISA over the next few years. this allows me to put any extra savings into simple high interest cash Isa's.

The account im looking at is the money box LISA, which pays 1.4%.

I cant imagine im the only one considering these options and i really want to know what other peoples thoughts are on this topic.

Thanks

eskbanker · 2 December 2019 at 6:41PM

I'd focus on getting as much as possible into a LISA (at £4K per tax year) by the time you want to purchase, so as to maximise the 25% bonus.

Anything else, leave in accounts with the highest possible interest - HTB ISA may form a part of this but non-HTB cash ISAs are unlikely to be worth it, as you'll likely be better using taxable accounts, given the personal savings allowance that should avoid the need to pay tax.

http://www.moneysavingexpert.com/savings/which-saving-account
http://www.moneysavingexpert.com/savings/savings-accounts-best-interest

Lifetime ISA VS Help to buy ISA

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