We are excited to introduce the first Moneybox cash product, helping first time buyers save for their future! Our new Cash Lifetime ISA has an interest rate 1.4% (AER variable), which beats any other provider on the market!
We know getting a foot on the property ladder can seem like a pipe dream… but with an annual government bonus, plus our market-leading rate, your dream home could be closer than you think.
Here are our top 5 Lifetime ISA must-knows
1. What is the Lifetime ISA?
The Lifetime ISA (LISA) is a product designed by the government to help you to purchase your first home. It can also be used to save towards your retirement (see our Lifetime ISA FAQs for more info on using the Lifetime ISA for retirement). You can open a Lifetime ISA if you are a UK tax resident aged 18-39.
2. How much can you save?
You can pay in up to £4,000 per year and you get a 25% government bonus on all savings. That means for every £4 you save, you get £1 for free. So, if you pay in the maximum £4,000 you’ll receive a £1,000 bonus each year. Kerching!
3. Cash Lifetime ISA vs. Stocks & Shares Lifetime ISA
Our newly launched Cash LISA works like a cash savings account, in that you will earn interest on the money you pay in. We have partnered with OakNorth Bank to offer a market-leading interest rate of 1.4% (AER variable). The interest accrues daily and is paid monthly.
With a Stocks & Shares Lifetime ISA, rather than getting interest like you do with a Cash Lifetime ISA, you invest your money in funds. Investing over the long term (5 or more years) can offer higher returns, but remember that the value of investments can go up and down, and you may get back less than you invest.
4. How can I use a Lifetime ISA to buy my first home?
You can use the amount saved in your Lifetime ISA towards your first home if:
- The property costs £450,000 or less.
- You buy the property at least 12 months after you open a Lifetime ISA.
- You have never owned a property before.
5. Can I withdraw my money at any time?
If you withdraw your money for any reason other than buying your first home (up to the value of £450,000), or for retirement after 60, you will pay a government charge of 25% on the value of the withdrawn amount, which means you may get back less than you put in. Please bear this in mind before opening a Lifetime ISA.
To open a Moneybox Cash Lifetime ISA, download the Moneybox app today.