Martin Lewis and Angellica Bell co-hosted the final episode in the current series of The Martin Lewis Money Show Live last night – ahead of its return in September. During the show, the financial journalist shared a number of money insights as well as answering questions from members of the public.
Having heard the email, the financial journalist and campaigner highlighted some options they would currently be able to access elsewhere.
Martin also explained how they should go about making the switch, should they wish to.
He replied: “Why not? You can switch LISA providers and get a higher rate – top payer is Nottinghamshire Building Society at 1.25 percent, followed by MoneyBox at one percent.
“Go to them, open one and ask them to transfer your existing LISA in.”
While on the topic of Lifetime ISAs, Martin went on to suggest some people open up a Lifetime ISA in this tax year, regardless of whether they were sure that they’d use it to purchase a first home.
That’s because there’s been a change in the rules, meaning they could open an account now but have until the end of the current tax year to make their decision without facing a penalty charge when withdrawing savings for “unauthorised” reasons.
He said: “A Lifetime ISA is a product that 18 to 40-year-olds can open and then they get a 25 percent boost up to £1,000 per year – when they use the money on a first-time house worth up to £450,000.”
The Lifetime ISA can also be withdrawn by the saver once they reach the age of 60 – meaning some may use this type of account for retirement savings.
“You have to have held it a year before you can use it,” he added.
“Now, the key problem with Lifetime ISAs is if you don’t use it for a qualifying house or take it out once you’re aged 60 or over, then you have to pay a penalty of six and a quarter percent for taking the money out for anything else.
“But that has gone at the moment, until the fifth of April next year, due to coronavirus.
“So people who need their money in there, can get it out.
“So right now, you can open a Lifetime ISA as a ‘no brainer’ and you make your decision on the fifth of April next year whether you want to withdraw your money and it’s no problem.
“So, if you’re 18 to 40 and you’ve never bought a house, go open a LISA. Nottinghamshire Building Society’s your best-buy.”
The Martin Lewis Money Show Live is available to watch now on the ITV hub.