Let's talk about Lifetime ISAs

You can use the LISA to buy your first home or save for later life. You must be 18 or over but under 40 to open a Lifetime ISA. You can put in up to £4,000 each year, until you're 50. The government will add a 25% bonus to your savings, up to a maximum of £1,000 per year.

You can hold cash or stocks and shares in your Lifetime ISA, or have a combination of both.

How much can you save? £4,000 per tax year. When you turn 50, you will not be able to pay into your Lifetime ISA or earn the 25% bonus. Your account will stay open and your savings will still earn interest or investment returns. 
Can you pay lump sums in? Yes
What's the Government bonus? 25% (ie, £1,000 each tax year assuming max investment of £4,000)
Can I withdraw money if not buying a house? Yes, for retirement, but if earlier, you won't get a bonus and will pay a penalty.
Can my partner open one as well?  If the person you're buying with has a Lifetime ISA too, they can also use their savings and government bonus (as long as it is also their first property they are purchasing).
Existing Investments: You can open a Lifetime ISA alongside any other ISAs you may hold (cash, stocks and shares, help to buy or innovative finance). But be careful not to exceed the overall annual ISA subscription limit of £20,000, which a LISA counts towards.

Purpose: You can withdraw money from your LISA if you're:

• Buying your first home,
• Aged 60 or over, or
• Terminally ill, with less than 12 months to live.

You'll be charged if you withdraw cash or assets for any other reason. Incurring this lifetime ISA government withdrawal charge may mean that you get back less than you paid in to your lifetime ISA. The charge is currently 20%. It goes back up to 25% on 6 April 2021.

Buying your first home:

You can use your savings to help you buy your first home if all the following apply:

• the property costs £450,000 or less
• you buy the property at least 12 months after you open the Lifetime ISA
• you use a conveyancer or solicitor to act for you in the purchase - the ISA provider will pay the funds directly to them
• you’re buying with a mortgage

Saving for later life

• You can take your savings out of a Lifetime ISA when you’re 60 or over.
• If you die your Lifetime ISA ends on the date of your death. There’s no charge to withdraw the funds or assets from your account.