Millions of Brits could possibly be in for £10,000 money by doing one factor
Millions of Brits could be in for free cash by following one simple task. Those under 40 could see their finances increase by up to £10,000 by opening a Lifetime Individual Savings Account.
Available to anyone aged between 18 and 39, the account aims to help Brits save up to £4,000 a year to buy their first home or to keep stacked away for retirement years.
If you have a spare £1 going, you can open the account, as reported by The Mirror. The account can then be kept for larger future investments with the government given a 25% bonus each tax year.
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If you were to save the maximum amount of £4,000, you would have an extra £1,000 to your name each year thanks to the bonus. Having said that, some drawbacks have been reported to having a LISA.
For example, if you decide to use the money towards a house, the properties you can choose from must be worth £450,000 or less. Alternatively, if you withdraw the money from said account for anything other than an ‘eligible home or ‘retirement’, a penalty of 25% is issued.
There is one expectation to this rule and that is if you are terminally ill with less than a year to live. If you were to die, any funds in the account get transferred to your beneficiaries – without the penalty inflicted.
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Money guru Martin Lewis has previously pointed out a flaw in the scheme claiming that many young first-time buyers are left with no option but to accept the penalty as they cannot find a house within the price range.
In a letter sent to the Chancellor earlier this year, the 52-year-old TV personality urged for a review of the house price limit to be relooked at.
If you decide to open and use a LISA for retirement, you’re available to withdraw the funds once you hit 60 – six years prior to when you can access the current state pension.
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