First time buyers can get up to £1,000 each year by opening a particular type of savings account.
Money Saving Expert is urging everyone between the age of 18 and 39 to open a Lifetime ISA (LISA) now, even if they only deposit £1.
Savers will get a 25% bonus from the state on everything they put in before they turn 50.
While you may not be thinking about buying a property yet, it’s well worth taking steps to ensure you get more for your money later on, Echo reports.
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You can put up to £4,000 in per tax year. The 25% bonus means if you save £1,000 you would end up with £1,250 – while the full £4,000 will turn into £5,000.
There is a limit of £4,000 on what savers can put in their LISA, which can be paid in a lump sum or by putting in cash when you can.
The 25% bonus on this maximum £4,000 saved per year would be £1,000.
The money from the LISA can then be used on your first residential home – costing up to £450,000.
It is important to note the LISA must have been open for at least a year for you to be eligible for any bonuses, with MSE urging all who can to open one now with £1 to get the clock started – just in case.
It’s still doable even if you’re buying with someone who isn’t a first-time buyer.
It’s an individual product, so first-time buyers can still use it, regardless of who they buy with.
Equally, if both are first-time buyers, you can have one each.
If you withdraw the money before you turn 60, however, there’s effectively a 6.25% penalty if you’re not buying a home.
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