Martin Lewis - Help-to-Buy VS Lifetime ISA
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- Опубліковано 6 бер 2017
- Should you transfer your Help to Buy ISA into a Lifetime ISA when they launch in April 2017? MoneySavingExpert founder and executive chair, Martin Lewis, analyses both accounts and answers this burning question.
I appreciate how transparent and charismatic Martin is when delivering these topics. My financial hero 😍
Good explanation Martin, very clear and concise and a lot easier than reading through tonnes of documents. Thanks!
It's the easy talk that made me get into what I do now. Absolute ledge.
The money box lifetime isa currently has the highest interest rate of 1.4% and you can manage your account on the app
Moneybox and Martin have made me enjoy my life a lot more this past 2 years
This is a great way of explaining these both - I wish I had realised that Martin had done a video on the same topic I have just done a video on !! WHOOPS - cannot compete with a PRO :(
This makes everything so clear, you're excellent! I rang Hargreaves and Lansdowne today and they said it'll be a £100 opening deposit for a lifetime ISA. Not too bad but not as good as £1 sadly!
Great video Martin, extremely clear and enthusiastic :) Which Lifetime ISA providers would you recommend? From what I've read so far only 3 firms have agreed to offer the Lifetime ISA (Hargreaves Lansdown, Nutmeg and The Share Centre) is it worth holding out or would you get started with saving a.s.a.p?
Great summary Martin, don't really watch MSE's content but the transfer rules were well explained both on the article and video.
Thanks for the feedback Stuart! Very helpful.
I've got a help to buy isa and I spoke to a manager in NY bank and they said I would have to live in the property for 6- 12months before I could rent the property out and change lenders to a buy to let
I think I'll change my help to buy to a life time isa, I would prefer to be able to hand over my deposit at exchange of contract as oppose to completion of sale.
the under £250,000 limit is a bit rubbish. where I live in Wiltshire all new builds that we looked at were above £250,000 for a small 3 bed house.
the only thing lower was tiny 2 beds or coach houses or flats
It's the don't be greedy isa
Hi MSE, I have a H2B and could move it to a LISA, but this would happen after the April date mentioned. On the numbers and allocation side, what does this mean for the transition? Less bonus?
'As long as you've got 16,000 in there you can use it towards the mortgage deposit straightaway' - is that correct? I thought if you only have 4,000 in there, but you were putting down the deposit and getting a mortgage you'd be able to use the Help to Buy ISA?
You’ve got to love this guy!
So good at explaining
Excellent explanation, just a shame that no one seems to be offering a cash LISA. So far only Hargreaves Landsdown and Nutmeg are offering stocks and shares LISAs so I hope this changes soon!
Hi Sally, Skipton Building Society has been the first provider to confirm it'll be offering a LISA, but only from June. More in our LISA guide: www.moneysavingexpert.com/savings/lifetime-ISAs Thanks, MSE Rosie
I know this post is a bit old now but moneybox has a cash lifetime isa now. Im in the process of transferring my help to buy isa to it.
Are lifetime ISAs and help to buy ISA only applicable when buying a new build, a brand new house or flat? Or can i use them to buy old properties as long as am a first time buyer?
If I've already got more than £4k in a help to buy isa and will be buying a first house quite soon, is there any point in me transferring it into my Lifetime ISA? Because I will get a 25% bonus on the help to buy anyway, (which would equate to more than the £1k LISA bonus)? Thanks, Rob
Can you use this for a first time property if you build or purchase a property in the USA in the future if I’m from the UK?
With the Lifetime ISA, is it only for renting a house or actually buying it?
Well I'll be transferring to LISA come 6th April!
who have you gone with?
Hey can we get an update on your ISA choice?
U got a new girlfriend!? Lisa? 🤣
An important difference is that you can withdraw money from you Help to buy ISA at any time and use it for anything you want. On the other hand, if you want to withdraw money from a Lifetime ISA and it's not for buying your first home and you're younger than 60 they will charge you 25% of your withdrawal...
Also, interests of Help to buy ISAs are higher.
Hi, so if i was to open a life time isa now would i have to wait for 2 years before gaining the benefit?
If I open a stocks and shares LISA now with £1 to "start the clock" can I switch to a cash LISA later in the year or will that restart the clock?
Do you need to put the £1 on the first day of the new tax year or can you put it in at any point? I was thinking put £1 at beginning tax year 2019, then keep putting into HTB until beginning tax year 2020 and transfer it all over. However what if this is more than £4000 as there is only £4000 limit ? And i swear you cant have HTB and lifetime ISA at same time?? but on here he is saying you can
Also Skipton seem to be only company that are offering a somewhat normal lifetime ISA that is described on internet, however this cannot be joint. Does that mean if I was to buy a house with someone in the future we couldnt join our lifetime ISAs together for a house deposit?? Thank you.
Hi Alice - you can combine two lifetime ISA with a partner - as long as you are both first-time buyers! Hope that helps - I just did a video on this very topic so been researching :) Hope this helps!
Are the penalties for early withdrawn the same on both thought you might have mentioned that?
Hi Daniel, there are no penalties for early withdrawal from a Help to Buy ISA (you just lose the bonus). For Lifetime ISAs, there is a penalty on top. More in our LISA guide: www.moneysavingexpert.com/savings/lifetime-ISAs Thanks, MSE Rosie
Interesting but I have one question. I cannot use the bonus from Help to Buy towards exchange but I can use it towards completion. But I already payed the entire deposit on exchange because it is required so there is nothing else to pay. Therefore how - please enlighten me - how am I allowed to use this bonus? I don’t understand and it’s not clear. My solicitor stated there is no way I can get cash back and I need to use the bonus towards completion but everything is payed already. Very confusing
Very clear
I put £1 in my lifetime ISA On February 2020. Does that mean I have to wait now until April 6 2021 to get the bonus or until February 2021?
Great Video, thanks for the info. You didn't mention interest rates. Which provides a higher interest rate?
Not possible to say until banks create the accounts. That's if they actually offer accounts in the first place, which many will not
Hi Craig, providers haven't released details of interest rates on offer yet, but we'll be sure to update our guide when they do: www.moneysavingexpert.com/savings/lifetime-ISAs Thanks, MSE Rosie
@@moneysavingexpert I have on question i cant seen to find the answer to help to buy isa the money u get given is it a loan, do you have to repay it in some way or is it a literally gift
Could you get either of these if you have gone bankrupt?
Can you have both lifetime and help to buy at the same time?
Can a parent open a either one of these for their children?
I currently have a barclays help to buy isa. Am I best transferring this over to a Lisa ? I'm in my mid 20,s
are you going to buy in the next year? if not then the LISA is the best option - much better return on your savings :) also did a video on this if that helps - ua-cam.com/video/VhBsq7Mef2w/v-deo.html :)
If you have a HtB ISA aren't you better opening a LISA for retirement and using the HtB to buy? Can you get both bonus' that way?
Hi, you can use a LISA for both retirement and buying a first home. Or can also keep your H2B ISA open and use both. More info in our LISA guide www.moneysavingexpert.com/savings/lifetime-ISAs Thanks, MSE Rosie
At the end it says to open a LISA and then keep paying in to the HTB, I thought once you opened a new isa you cant pay in to the other isa accounts?
You can’t but you can open one as long as you transfer it straight away
Does the LISA bonus get paid annually then or is it paid on completion like the HTB ISA?
Gets added to you balance monthly
It’s does on Moneybox that’s all I use as they are still paying 1% interest which is the best at the moment
@@oasis4life014 went for Stocks and shares LISA with Hargreaves Lansdown. Cheers!
Am I right in thinking that if I have more than 4000 in my HTB ISA at the time I transfer, I would lose the bonus on everything above that? Would I be able to transfer in the full amount?
Hi, full info on transferring a Help to Buy ISA into a Lifetime ISA is in our LISA guide, point 5. www.moneysavingexpert.com/savings/lifetime-ISAs Thaks, MSE Rosie
Can you use your LISA for your house deposit as well as your mortgage? Cheers
Yes
Can i have a help to buy isa and lifetime isa and pay in them both in the same year?
I opened a help to buy for my daughter just before it closed. We don't have any plans for her to buy a house in the next couple of years.
Are there any benefits and is it possible to have a help to buy and LIsa open at the same time and pay into them both in the same year? e.g could she pay £4000 in the LISA and £2000 in to the Help to buy?
I know you can only get the bonus from 1 to use on the property so i'm thinking...... If she saved £4000 per year in the help to and then used that to buy her house eventually in say 5 years, the bonus would be higher than she could ever get in the help to buy. However, the interest rate on the help to buy is better than a current account or any saver at the moment. So, i'm thinking to continue to pay into the help to buy as well. BUT, would she loose all the interest that she has gained on the help to buy when she finally withdraws it after 5 years or in 2030 or is it just the gov bonus that she would loose? Thank you.
what are the risks of using a lifetime isa?
@@Keenangoal Good point
I have a question regarding interest rates. A help-to-buy ISA has an interest rate of 2.5%, whereas the best LISA rate, currently with Moneybox, is 1.4%. If I begin saving now, should I open a help-to-buy ISA to take advantage of the higher interest rates and then switch to a LISA if the rate at which I can save increases?
I went with the help to buy, if you are going to open one, open it now! They stop doing them at the end of the month
I have done exactly what you are suggesting. I have a lifetime Isa that i try to put £200 in a month, then my help to buy I stick the mini of £20 a month and get the 2.5% interest rate
Great video except it's missing the withdrawal penalties. Help to Buy ISA has no withdrawal penalty, LISA has a 6% withdrawal penalty before age 60 (you lose the 25% bonus with both of course).
So if you use the LISA to buy a house before age 60,you lose the 25% and have to pay the 6%?
@@oliviamiller-davis4667 Late by 2 years 😅but if you withdraw to buy a house, that penalty doesn’t apply
so can you withdraw from the lifetime ISA once you've saved enough for a deposit?
Hey John, you wouldn't be able to withdraw yourself. Your solicitor would have to approve once you made a definite choice on a property
0:46 - Hmm, are u allowed to open both..? 💭💭💭 - @Acharich
Acharich Speaks he’s saying you can transfer between the two so yes?
Yes, you can
Is this really the case, if I open a LISA I only have a year to transfer my Help to Buy ISA savings into it. Once that year has passed I can never transfer it over to it?
You can withdraw the Help to buy ISA with no penalty and then transfer the savings to a LISA and get the bonus!
Hi, thanks for all this. So I spoke with Barclays and they said I cannot have a Help To Buy ISA and a Life Time ISA at the same time, I explained your suggestion of opening one to get the clock ticking but they said I couldn't! So am I miss understanding this?
I have a help to buy with Santander and a life time isa with Skipton
me and my girlfriend saved into a help to buy ISA Great untill we went to use it and due to our house being over £250,000 meant you we couldn't use it.
I guess we should of read the all the details. Luckily for us they dropped the stamp duty for first time buyers which saved us nearly £4000
*have
From Skipton Building Society's (the only provider for a cash LISA) website under 'Can I withdraw my money?' - 'From tax year 2018/2019, withdrawals or account closures will normally have a government charge of 25% of the amount withdrawn. Sections A and B in the Online Cash Lifetime ISA Key Features document which explain why you may get back less than you paid in and exceptions to the withdrawal charge.' 2 years of savings. £8000 topped up to £10,000 by gov, charged £2500 to withdraw.... so you get back less than you put in...
Are these rules still the same in December 2021 ?
What about if you are buying a shared ownership property over 250k but buying only a share?
Hi am 26 haven't started saving yet, I'm looking into a life time isa to buy a save for a house, are the risks worth it?
Hi Nicola, really depends on how likely you are to buy a home. If you take a Lifetime ISA out, but then decide not to buy a home and want to withdraw the money then you will be penalised i.e. less money than you put in. Otherwise, you have to keep it in until you're retired to not get a penalty. I wrote this blog that should help explain medium.com/homewards/saving-for-a-house-help-to-buy-isa-or-lifetime-isa-46dbdb6f0efe
Thank you that's really helpful advice
I think I will stick with help to buy ISA
So can you have both??
No
I wish the government would just stop creating all these stupid complicated schemes. If they wanted to help savers then they should stop punishing savers by balancing the books and allowing the BoE to raise interest rates.
Matthew unfortunately they wouldn’t do that because that’s what keeps the rich and elite stupidly loaded
@@t.tthegreat6319 I know this was 9 months ago but how does low interest rates enable that?
@@xHenry3110 low interest rates = less people saving = more people spending their disposable income. Essentially, lining the pockets of the large corporations etc. Only a guess though, might not be what they mean.
Guys where would be the best way to open a lifetime ISA?
I use the MoneyBox app its really easy to get started :) Did a vidoe on it - if that helps :) ua-cam.com/video/VhBsq7Mef2w/v-deo.html
But isn't all these schemes just a loan ? Like ots not a gift from them you have to repay them? Or they own equity in your house? Or ? I'm confused my girlfriend took one out thinking its just a gift bonus towards helping and I said to her im sure you will have to pay the money you get given from the government back
Can I have a help to buy ISA and a LISA? And benefit from the bonus of both of them when I buy a house?
Hi Katrina, you can have both but you can only get the bonus from one of the schemes! I just did a video about this topic which is more up-to-date and informative I hope!
so... I'm a Brit but expect to buy my first home in Norway since my fiancé is Norwegian. Does that make this a waste of time for me?
Yes, these schemes are designed for the purchases of property only in the uk and not outside I'm afraid :)
However if your using the lifetime ISA for retirement purposes I think you can still benefit from that one even in Norway but confirm this with the provider.
This dude’s good 👍🏽
Call it a lifetime isa but isn’t lifetime 😳
Are all the banks rolling out the Lisa at the same time??
Hi Ben, only a handful of providers have confirmed they'll be offering a LISA, and will be launching at different times. More in our guide: www.moneysavingexpert.com/savings/lifetime-ISAs Thanks, MSE Rosie
I have just swapped £2k from a HTB ISA into a LISA. £600 of this was paid before 6th April 2017. I then added another £2k to top up to my £4k LISA limit. Because the £600 was paid into the HTB before 6th April 2017. Does this mean i can actually put £4.6k into my LISA for this tax year?
If anyone knows and can share with me, it will be greatly appreciated.
Hi Ashley, to confirm you cannot put more than £4k into a LISA in anyone tax year. If you're looking for extra help to top up your LISA you should check out www.homewards.io
Its a shame nobody will actually be offering the lifetime ISA :/
Hi, a few providers will be offering a LISA, though it'll be slim pickings. Full info in our Lifetime ISA guide: www.moneysavingexpert.com/savings/lifetime-ISAs Thanks, MSE Rosie
so if I open a help to buy ISA tomorrow 21st June. and I open a lifetime ISA on the 25th June. I could take the £850 profit on 21st June 2018. and transfer money on 22nd June 2018 to my lifetime ISA. and pick up that extra grand.??????
Poor people savings such a joke
Desmond Alloffo why
Can a couple both come together on a mortgage and both use their bonuses?
Yes you can, answered my own question
YOU are the expert Mark!
I wander who come up with all this crazy rule !!!
Why does LIFETIME ISA is not for over 40? Where the sender in that?
I'm sure Martin hasn't got to worry about these kind of things like the rest of us 😔
Don’t invest in anything with less than a net return of 2.5%! If you do you’re not even beating inflation.
Both schemes have a 25% net return!!
yes but Martin you was say a month back help to buy isa and now you saying both make your mind up what is best
Can any body tell me what's best way to save for your retirement
Hi there - Check out our guide for further help: www.moneysavingexpert.com/savings/discount-pensions
Slightly misleading, you can only transfer 4000 so if your h2b ISA is over the 4000 limit it will take 2 years to transfer the full amount if under 8000, just found out to my detriment
Has it been explained how the 25% "bonus" for first time buyers will work exactly - ie is it like an APR interest rate on the contributions? If for example, I open a lifetime isa in April 2017 with just £1, and then in March 2018 I deposit £3999 AND transfer say £2000 from a previously opened help to buy isa, would I get £1500 added to my lifetime isa as a bonus in April 2018 (25% of the total £6000) or just a fraction of this?
Hi Mat - It doesn’t work like interest, really, in that it doesn’t matter when in the first year you put your £4,000 in. Provided it’s in the account by 5 April 2018, you’ll get the full £1,000 bonus.
In the scenario you describe, provided all the Help to Buy ISA cash was contributed to the H2B ISA before 6 April 2017 (if after, it affects how much you can put in the LISA), you’d get the bonus on the whole lot - so £1,500. Hope it helps!
So confusing
ISA JAR JAR BINKS
can i rent home with LISA?
No
I'm an idiot because
I put £20 in a help to buy ISA.
PINK why??
@@user-yo7lx8cc4r Because I had a low income and I thought it would be a good idea to save some money up.
@@user-yo7lx8cc4r is it really bad?
PINK why is saving money not good??
@@user-yo7lx8cc4r I mean is it really bad if I put a really small amount of money per month into a help to buy ISA?
Don’t whatever you do give your money to a bank now. Buy a bit of gold. The banks are crashing right now.
Blackman and Robin . Yes of course! And a financier.
I’m sad I didn’t get to open a help to buy isa
Where is your girlfriend sir (made for each other)
The staking taurus intringuingly roll because motion preliminarily add beyond a bad millimeter. picayune, typical spring
She be my help for you people with special needs adls to get the home in norfolk with is the help to buy to are you on home
Can you have both lifetime and help to buy at the same time?
ISA JAR JAR BINKS