First-time buyer ISA.

Do you struggle to save money for the future? It isn’t always easy, especially if you’re living in an expensive city like London. How do you save up a deposit for your first home or save up to retire? If you’re asking yourself the same questions, we’ve got a potential solution for you. Individual Savings Accounts (ISAs) offer a tax-free way to earn interest on your savings. In this article, we will focus on Lifetime ISAs and how you can use them to buy your first home or invest in your retirement. Remember that the rules around tax can change, so make sure you have the latest information before making a decision. We don’t offer tax advice at Winwell Financial Consultancy, but we can guide Londoners through the mortgage process so you know what your options are and help you find a good deal.

Is there a Help to Buy scheme in England?

We get asked about the Help to Buy scheme all the time but unfortunately it ended in 2023.There is talk of it being reinstated, but in the meantime, there is another option that you can consider.

Lifetime ISA (LISA)

Lifetime ISAs are specific tax-free savings accounts intended to help you buy your first home or plan for retirement.

To open a Lifetime ISA, you must be:

• Between the ages of 18 and 40.

• A resident of the UK or a member of the armed forces.

The pros:

• You can put up to £4,000 into the ISA per tax year, and the government will contribute £1 for every £4 saved. So, if you save £4,000, the government will give you an extra £1,000.

• You can’t open a Lifetime ISA after the age of 40, but you can continue to contribute to an existing ISA until you’re 50.

• You can invest your ISA money in stocks and shares, or opt for a cash ISA and earn interest on your savings.

The cons:

• You will incur a Lifetime ISA government withdrawal charge (currently 25%) if you transfer the funds to a different ISA or withdraw the funds before the age of 60. You may therefore get back less than you paid into a Lifetime ISA.

• If you save in a Lifetime ISA instead of enrolling in, or contributing to an auto-enrolment pension scheme, occupational pension scheme, or personal pension scheme, you may lose the benefit of contributions from your employer (if any) to that scheme. Your current and future entitlement to means tested benefits (if any) may also be affected.

• The money you withdraw from your Lifetime ISA must be for specific circumstances.

• To buy your first home

• When you reach the age of 60.If you have less than 12 months to live.

While we don’t offer specific savings or tax advice, our London-based Winwell experts can give you mortgage advice. Get in touch with our team of financial experts to find out more about how we can help you.

Your home may be repossessed if you do not keep up repayments on your mortgage.
There may be a fee for mortgage advice. The fee is up to 1%, but a typical fee is £199.