Lifetime ISAs guide
Comments
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I'm pretty sure it would be your choice of 2 or 3. (I don't see any difference between 1 and 2.) So if you prefer 2, yes, have a higher deposit using the full LISA balance.I was pondering something this morning concerning the deposit one would putting down on a house and the targeted LTV. If I am targeting a house purchase of 130k with a 10% deposit with 15k in a LISA what would happen to the surplus 2k. Would this automatically be:
1. Used to reduce the size of the mortgage (what i believe the HTB bonus achieves?)
2. Increase the deposit therefore reducing LTV
3. Remain in the account to use foe retirement
If 3. above it would make sense to me that someone on a work pension plan (given this would likely trump the LISA pension use) should calculate their LISA value according to their house deposit to the nearest pound possible, as otherwise it would be money that could have been used on other costs ie fees etc (admittedly some of this would be bonus)
It would be great to hear thoughts as I can't recall reading about it anywherekoru0 -
I prefer hold on account, so that there's a trickle of cash coming in which can meet the HL fees. Then periodically reinvest any built up cash, which might cut your transaction costs. If you want to reinvest immediately, then choose accumulation units where possible, so the fund reinvests for you. (Not usually possible if you want shares or ETFs.)I'm opening a LISA with Hargreaves Lansdown today and it'd be great to get a bit of guidance on which option is generally better for how any income is treated - the two options are 'Held on account' or 'Automatically re-invested' (both explained below). I assume re-investing is more profitable long term but holding on account short-term seems to prevent the charges/commission. Any advice? Thanks
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Held on account
The income can be held pending your instructions, in which case any income will remain within your account but we will not invest it until you tell us to do so.
Automatically re-invested
We will reinvest any income automatically for you when it reaches £10 (or your chosen minimum) per holding. Automatic reinvestments take place between the 11th and 21st of the month and are charged at 1%, minimum £1, maximum £10. Please remember stockbroking commission applies to income reinvestments for shares and other investments.koru0 -
I prefer hold on account, so that there's a trickle of cash coming in which can meet the HL fees. Then periodically reinvest any built up cash, which might cut your transaction costs. If you want to reinvest immediately, then choose accumulation units where possible, so the fund reinvests for you. (Not usually possible if you want shares or ETFs.)
Thanks, Koru - I really appreciate the response.
A couple more Qs:
1) Can I ask how long you've had your HL LISA and whether on balance it feels like it's been the best stocks and shares LISA to have invested in?
2) What's the alternative to choosing accumulation units? I agree I'd want the fund to reinvest it but want to check what the other option would be.
3) What's the process when you do want to reinvest the income you've made? Do you just specify the stocks you want to invest in and the amount you can put forward, then they tell you what the transaction costs will be?
Thanks again for your advice. I'm a bit of a rookie with stocks and shares and the HL website doesn't seem to have much specific guidance.0 -
I'm in the process of buying a house in my sole name using HTB ISA.
I am moving in with partner, but the relationship is fairly new so we don't want a mortgage together yet.
If and when he 'officially' joins the mortgage, will he be able to use a Lifetime ISA bonus to buy in to my property? Or would he only be able to use it if we bought somewhere new together?0 -
My understanding is that a LISA bonus can be used in this way only if it's to be a complete sale and repurchase property transaction via a conveyancer, rather than just a financial remortgage. However, if you're in the process of buying just now, it might be worth asking your current conveyancer to confirm this....I'm in the process of buying a house in my sole name using HTB ISA.
I am moving in with partner, but the relationship is fairly new so we don't want a mortgage together yet.
If and when he 'officially' joins the mortgage, will he be able to use a Lifetime ISA bonus to buy in to my property? Or would he only be able to use it if we bought somewhere new together?0 -
1) Until a few days ago, it was the only S&S LISA, so yes it was the best. If I were choosing now, I'd probably go for AJBell, as they are cheaper, but HL do have especially good service, so you may feel that is worth it.1) Can I ask how long you've had your HL LISA and whether on balance it feels like it's been the best stocks and shares LISA to have invested in?
2) What's the alternative to choosing accumulation units? I agree I'd want the fund to reinvest it but want to check what the other option would be.
3) What's the process when you do want to reinvest the income you've made? Do you just specify the stocks you want to invest in and the amount you can put forward, then they tell you what the transaction costs will be?
2) The alternative is income units, which means the fund pays you a dividend equal to your share of the income it earned. By fund I mean a unit trust or OEIC. ETFs and shares generally have no accumulation option.
3) I believe the default is that they reinvest in whatever was the source of the cash that is being reinvested. So, if you want to choose, you need to go for manual.koru0 -
Good morning guys,
Super quick question,
I have opened a cash Lifetime Isa with Skipton this tax year, Filled it out with £4.000, And looking to put money from now on into a existing Cash Isa. a) can I do this? Until I reach the the 20k mark (So another 16k)
b)Can I open another Cash Isa this tax year? (As i have already opened to LISA this year)
Thankyou in Advance:)0 -
Yes, you can pay up to £16K into a new or existing cash ISA this tax year, but it's unlikely to be the best thing to do with a spare £16K given the rates that cash ISAs pay - see http://www.moneysavingexpert.com/savings/which-saving-account for alternative ideas to earn more interest....I have opened a cash Lifetime Isa with Skipton this tax year, Filled it out with £4.000, And looking to put money from now on into a existing Cash Isa. a) can I do this? Until I reach the the 20k mark (So another 16k)
b)Can I open another Cash Isa this tax year? (As i have already opened to LISA this year)0 -
My daughter and her fiance have each opened a Lifetime ISA with Skipton and are currently saving monthly with them. Our intention is to make each of their amounts up to £4,000 nearer the time. Can we leave it right till the 3rd/4th April 2018 to do this?0
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