UK households could get a £1,000 bonus from an “invaluable” ISA savings option, it has been said. People in the UK have been urged to open a Lifetime ISA – or a LISA, as it is nicknamed – which could provide a yearly bonus of £1,000 at a time where the Cost of Living crisis is continuing.
A saver can deposit up to £4,000 each tax year into a LISA, with any deposits getting a 25 per cent bonus, up to £1,000. Brian Byrnes is head of personal finance at Moneybox, told Express.co.uk: “It’s proven to be an invaluable savings option for young people across the length and breadth of the country and has already enabled a whole generation (around 130,000 people) to buy their first home, far sooner than would have otherwise been possible.
“In addition, beyond any other product launched in recent years, the Lifetime ISA has helped drive real behavioural change among young people, helping them build and embed positive long-term saving habits earlier in life.” Mr Byrnes said: “Looking to the future, without a doubt, LISA rules should be regularly reviewed to ensure the product remains fit for purpose.
READ MORE 36 million UK households face unwelcome tax bill after Wednesday
“Thinking about the next generation of aspiring homebuyers who are just starting on what is a five- to eight-year deposit-saving journey, we strongly believe the price cap should be index-linked to house prices and subject to an annual review. This will provide some much-needed reassurance and peace of mind to LISA savers who live and work in some of the most expensive parts of the UK and ensure the product remains fit for purpose for all those who need it most, into the future.
“Moneybox has also been campaigning the Chancelllor to introduce a penalty-free annual ‘Emergency Withdrawal Allowance’ so that LISA savers are not penalised if they need their money in an emergency.” Mr Byrnes added: “The Lifetime ISA is a fantastic product that’s helped a whole generation of aspiring first-time buyers save and invest their way toward a deposit and it’s vital to build on this success, to ensure it continues, and to meet the needs of the next generation of home buyers.”
