Discussion
Just a quicky.
I'm trying to convince my girlfriend to open a LISA. Just want to make sure it's the right thing really.
I'm a homeowner so wouldn't be entitled to take monies out early. However I believe if we bought a property together then she, as a first time buyer, could use a LISA lump towards this.
The only 'problem' is, is that we'd be buying at the upper limit of the threshold around £450-500k (threshold being £450k). I feel that if we have the money/means to buy a property for more, then we're in a good position and won't necessarily need the money in a LISA and she can save it for retirement, although it could potentially have over 20k in it.
Also the fact that if things were to change and we split up, she'd have a deposit for her own place which would get the bonus, so she'll never be onto a loser as far as I can see.
My only thought is that I'd kick myself if we saw a property that we loved, but could only afford it if we used the LISA but would have to take the 25% penalty (around 6% real world to what she'd pay in). That said 6% on £16k paid in would only be around 1k real world loss.
Thoughts please
.
I'm trying to convince my girlfriend to open a LISA. Just want to make sure it's the right thing really.
I'm a homeowner so wouldn't be entitled to take monies out early. However I believe if we bought a property together then she, as a first time buyer, could use a LISA lump towards this.
The only 'problem' is, is that we'd be buying at the upper limit of the threshold around £450-500k (threshold being £450k). I feel that if we have the money/means to buy a property for more, then we're in a good position and won't necessarily need the money in a LISA and she can save it for retirement, although it could potentially have over 20k in it.
Also the fact that if things were to change and we split up, she'd have a deposit for her own place which would get the bonus, so she'll never be onto a loser as far as I can see.
My only thought is that I'd kick myself if we saw a property that we loved, but could only afford it if we used the LISA but would have to take the 25% penalty (around 6% real world to what she'd pay in). That said 6% on £16k paid in would only be around 1k real world loss.
Thoughts please
.I have a S&S LISA with AJ Bell, stuck £4k in it just before the end of the last tax year for the free £1k lump and now maxing it monthly (£4k / 12 = £333) and sticking in a couple of funds. All going well so far, free money at the end of the day...
@OP - You're correct and if you do have to dip into the LISA to buy the dream house then so be it, you're obviously both in a good financial situation to be looking at £500k homes so a penalty of a meager 6% so you say (haven't done the maths myself) wouldn't bother me personally. Essentially, I'd rather be contributing to a LISA and not need it than just save in a regular Cash ISA and potentially lose out of thousands worth of free money for no extra effort.
@OP - You're correct and if you do have to dip into the LISA to buy the dream house then so be it, you're obviously both in a good financial situation to be looking at £500k homes so a penalty of a meager 6% so you say (haven't done the maths myself) wouldn't bother me personally. Essentially, I'd rather be contributing to a LISA and not need it than just save in a regular Cash ISA and potentially lose out of thousands worth of free money for no extra effort.
Edited by S9JTO on Wednesday 6th June 15:58
S9JTO said:
I have a S&S LISA with AJ Bell, stuck £4k in it just before the end of the last tax year for the free £1k lump and now maxing it monthly (£4k / 12 = £333) and sticking in a couple of funds. All going well so far, free money at the end of the day...
@OP - You're correct and if you do have to dip into the LISA to buy the dream house then so be it, you're obviously both in a good financial situation to be looking at £500k homes so a penalty of a meager 6% so you say (haven't done the maths myself) wouldn't bother me personally. Essentially, I'd rather be contributing to a LISA and not need it than just save in a regular Cash ISA and potentially lose out of thousands worth of free money for no extra effort.
Yeah, I guess we're not doing so bad, I'm fairly established workwise and the missus is just starting out in her teaching career. The aim would be to get a ~£200k mortgage max (in 4-5 years time), buying a 'forever home', which wouldnt stretch us with our combined income and I could cover if needs be off my own back, even when interest rates begin to rise. @OP - You're correct and if you do have to dip into the LISA to buy the dream house then so be it, you're obviously both in a good financial situation to be looking at £500k homes so a penalty of a meager 6% so you say (haven't done the maths myself) wouldn't bother me personally. Essentially, I'd rather be contributing to a LISA and not need it than just save in a regular Cash ISA and potentially lose out of thousands worth of free money for no extra effort.
Edited by S9JTO on Wednesday 6th June 15:58
We'll have to make consideration to a S&S Lisa, despite the relative short term the money will be in there.
Yep, I have a Skipton LISA, just paid out almost £1k.
Blurb says 'account must be open 12 months before any bonus is paid', this is false, 8 months in, got my 25%. and now it's paid in monthly,
I'm in London so I'm looking at one bed shoe boxes to come under the max value cap, but make it a probate sale and flip in 18 months I should be fine.
DO IT.
Blurb says 'account must be open 12 months before any bonus is paid', this is false, 8 months in, got my 25%. and now it's paid in monthly,
I'm in London so I'm looking at one bed shoe boxes to come under the max value cap, but make it a probate sale and flip in 18 months I should be fine.
DO IT.
Bullet-Proof_Biscuit said:
Yep, I have a Skipton LISA, just paid out almost £1k.
Blurb says 'account must be open 12 months before any bonus is paid', this is false, 8 months in, got my 25%. and now it's paid in monthly,
I'm in London so I'm looking at one bed shoe boxes to come under the max value cap, but make it a probate sale and flip in 18 months I should be fine.
DO IT.
For the first year it was only paid after 12 months, from this year onwards it'll be paid monthly, see my above post - You need to have the LISA for a minimum of 12 months before it can be used towards a deposit too.Blurb says 'account must be open 12 months before any bonus is paid', this is false, 8 months in, got my 25%. and now it's paid in monthly,
I'm in London so I'm looking at one bed shoe boxes to come under the max value cap, but make it a probate sale and flip in 18 months I should be fine.
DO IT.
S9JTO said:
For the first year it was only paid after 12 months, from this year onwards it'll be paid monthly, see my above post - You need to have the LISA for a minimum of 12 months before it can be used towards a deposit too.
Ah right thanks for clarifying, I did read the contract a few times and it was so unclear. Just a word of warning as well, these LISAs are relatively new so a lot of people don't know how to use them/ withdraw from them
Make sure you clarify everything first with your ISA provider/solicitor on exactly what the process is of getting funds removed
Just bought my property using it and getting the correct bonus applied took weeks, nearly costing us the sale
Make sure you clarify everything first with your ISA provider/solicitor on exactly what the process is of getting funds removed
Just bought my property using it and getting the correct bonus applied took weeks, nearly costing us the sale
Bullet-Proof_Biscuit said:
Yep, I have a Skipton LISA, just paid out almost £1k.
Blurb says 'account must be open 12 months before any bonus is paid', this is false, 8 months in, got my 25%. and now it's paid in monthly,
I'm in London so I'm looking at one bed shoe boxes to come under the max value cap, but make it a probate sale and flip in 18 months I should be fine.
DO IT.
I have the Skipton too, closed the H2B ISA that I had and managed to get my money into the LISA just days before the new tax year Blurb says 'account must be open 12 months before any bonus is paid', this is false, 8 months in, got my 25%. and now it's paid in monthly,
I'm in London so I'm looking at one bed shoe boxes to come under the max value cap, but make it a probate sale and flip in 18 months I should be fine.
DO IT.
Got a nice £1k Gov bonus paid a few weeks later from the 17/18 tax year.
Currently putting ~£330/month into it to hit the annual limit and seeing good monthly bonuses paid. Can't fault it really, doesn't pay much interest but 25% bonus is hard to beat over a 2-3 years.
smithyithy said:
I have the Skipton too, closed the H2B ISA that I had and managed to get my money into the LISA just days before the new tax year
Got a nice £1k Gov bonus paid a few weeks later from the 17/18 tax year.
Currently putting ~£330/month into it to hit the annual limit and seeing good monthly bonuses paid. Can't fault it really, doesn't pay much interest but 25% bonus is hard to beat over a 2-3 years.
Stick it in a S&S LISA and stop playing it so safe, 25% bonus to play with there.Got a nice £1k Gov bonus paid a few weeks later from the 17/18 tax year.
Currently putting ~£330/month into it to hit the annual limit and seeing good monthly bonuses paid. Can't fault it really, doesn't pay much interest but 25% bonus is hard to beat over a 2-3 years.
I'm no expert but with a few hours of research I stuck my money in two funds and they've returned 9% and 10% respectively since opening just before the end of the 17/18 tax year. From the £4,999 I've put in to date (similarly putting in £333pm after the initial £4k max), my LISA is sitting at ~£6,850, pretty good return for just over ~3 months (this includes the Government bonuses too) - Of course there's a risk this will fall too, but even so, it's highly unlikely it'll drop below £4,999 *touches wood*.
Edited by S9JTO on Wednesday 13th June 09:09
Edited by S9JTO on Wednesday 13th June 09:10
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