Transferring S2B ISA to LISA

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Charlotterose_2
Charlotterose_2 Posts: 2 Newbie
in ISAs & tax-free savings
Hi everyone

Sorry if this has been asked before or it’s a really stupid question.

I’ve been saving in a save to buy isa for the last two years. It’s got a few grand in it.

I’ve recently gone freelance and am earning a lot more than I was previously and after some research it appears I’d be better of using a LISA.

What’s the best way to go about this? Is it as simple as closing down my S2B ISA and opening up a LISA, and transfer it all in and go from there? Is there a certain time of year that would be better to do this?

I know I sound silly when I write this I just want to check that I’m going about it in the right way.

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  • eskbanker
    eskbanker Posts: 31,241 Forumite
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    You can pay up to £4K into a LISA in any given tax year, even if it's being transferred from another type of ISA - you can open the LISA and request the new provider to arrange the transfer, which is probably the easiest way of doing it.

    LISA interest is typically fairly low compared with (some) other ISAs, especially Help to Buy ones (is that what you meant?), so check the respective rates as you may be better leaving your money where it is for now and transferring over towards the end of the tax year, e.g. March 2019.
  • Charlotterose_2
    Charlotterose_2 Posts: 2 Newbie
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    That’s helpful, thank you!

    I will arrange a transfer over in March 19 :)
  • Wildsound
    Wildsound Posts: 365 Forumite
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    You can save into BOTH a HTB ISA AND a LISA. If you're able to save £6,400 a year, and without causing you any financial distress, I would argue that you should be utilising both. When you come to buying a property, you can cash in the HTB ISA and pocketing the interest (which is higher than any other cash savings account with immediate access) with no penalty other than you won't be able to gain the government bonus from this account. You can use the LISA towards buying the property utilising the government bonus.
  • Alexland
    Alexland Posts: 9,665 Forumite
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    Charlotterose wrote: »
    I will arrange a transfer over in March 19 :)

    ISA transfers take time and can often be delayed so I would suggest you start the transfer earlier so that the money is near certain in the new account before the end of the tax year.

    Alex
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