Be savvy and get onto the property ladder TODAY!
MONEY SAVVY RAVI: THE 5 STEPS TO GETTING THE HOUSE OF YOUR DREAMS!
The average purchase price for first time buyers in London stands at a whopping
£385k, whilst the average age for a first time buyer in the area in now 32! One way to
get onto the property ladder is by becoming best mates with LISA. For every £4 you
give her, she gives you £1 back!
Here is what you need to know:
1. Think of the Lifetime ISA as your little government buddy who is helping you
shelter your hard earned money from the tax-man. Because you are both best
friends, LISA gives you a 25% bonus of the money you put in. The maximum bonus
is £1,000 a year! You can only become friends with LISA if you are saving towards
your first home or for retirement.
2. LISA operates in a similar way to other ISA’s, whereby you won’t pay tax on
any interest earned, income or capital gains from cash or investments held within
one of these bad boys.
3. To become best buddies with LISA, you must be aged 18 or over but under
the age of 40. You can save up to £4,000 a year, and can continue to pay into it until
you reach 50. The account can stay open after then, but you can’t make any more
payments into it.
4. The key thing to remember is that your savings will be kept on a tax-free basis
for as long as you keep the money in your Lifetime ISA. Don’t forget that your annual
ISA limit for the tax year 2017/2018 is £20,000 and your LISA counts towards this
5. LISA is your best buddy, but she will also burn you if you betray her. Meaning
- if you withdraw the money held in a Lifetime ISA before you’re 60, you will be
slapped with a 25% withdrawal charge on the amount you take out. LISA gets that
sometimes things don’t always go to plan, so she gives you a break if the money you
withdraw goes towards your first home, you hit the tender age of 60, you are
terminally ill with less than 12 months to live or are transferring to another Lifetime
The first time house buyer must be buying a house worth less than £450,000 to
make use of the LISA savings and bonus, whilst you can only use the money for
your first home after 12 months of having one open! A few other rules apply so don’t
forget to do your homework. Being best friends with LISA isn’t for everyone, so
choose your friends wisely!
Don’t forget….If you’re buying with a friend or partner who is also a first time buyer,
and you each have a Lifetime ISA, you can both use your government bonus. So,
that means double the bonus!! If they have a LISA but aren’t a first-time buyer, hello