The lifetime ISA is a savings account that will allow people to save either towards their first home or their retirement. Those who sign up can save up to £4,000 a year and receive a government bonus of 25% – which means those who put in the maximum each year will receive a £1,000 bonus every 12 months from the government.
Individuals will be able to open a lifetime ISA from 18 years old until they turn 40; however, any withdrawals by those aged under 60, that are not for a first home, will result in the loss of all the government bonuses, plus all the interest or growth on those bonuses. On top of that… a 5% penalty would also be applied. Not sounding quite so good? Ministers originally suggested that the new ISA would be suitable for the self-employed because of the ability to withdraw cash. However, as previously mentioned, the hefty exit penalty means that self-employed people should not take out a lifetime ISA with the view of treating it like an easy-access savings account. Additionally, people who have already bought a house should think very carefully before opening a lifetime ISA as a ‘retirement only’ product. With no contributions allowed after age 50, and a ‘lock-in’ of cash until age 60, there are serious questions about the suitability of the lifetime ISA for this group. Having said this, the lifetime ISA can be used to complement rather than replace pensions as it’s a long-term savings product which allows flexibility. For mortgage advice and information regarding owning your own home, please contact us by email or by calling +44 (0) 20 3858 0313.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON A MORTGAGE OR ANY OTHER DEBT SECURED ON IT
Max Adams Ltd is an Appointed Representative of HL Partnership Limited, which is authorised and regulated by the Financial Conduct Authority. The Financial Conduct Authority does not regulate some forms of buy to let, offshore mortgages, commercial loans or bridging loans. Your home may be repossessed if you do not keep up repayments on your mortgage. We do not charge a fee for residential mortgage advice. We charge an administrative fee for processing each of your mortgage contracts; our fees only apply when you decide to go ahead with an application. Standard residential and buy to let high street mortgages. The highest fee is up to £999, payable on application.
Private Bank and specialist mortgages The highest fee of 1% of the mortgage loan size applies of which £999 is payable on application with the balance payable on completion. Max Adams Ltd is a company registered in England and Wales with company number 7952988. Registered office: Brick House, 150a Station Road Woburn Sands, Milton Keynes, England, MK17 8SG. The information contained within this website is subject to the UK regulatory regime and is therefore targeted at consumers based in the UK. You voluntarily choose to provide personal details to us via this website. Personal information will be treated as confidential by us and held in accordance with the Data Protection Act 1998. You agree that such personal information may be used to provide you with details of services and products in writing, by email or by telephone.