 Martin Lewis has issued urgent advise to stop grandchildren missing out on £1,000s of free cash. The money saving expert has urged people to set up a Lifetime ISA (LISA) for their grandchildren which can help them buy a first home. His website said: 'For (grand)parents wanting to help their (grand)kids buy a home, giving them cash to put in a LISA is a great way to do it – though they'll need to open the LISA account themselves as you can't do it for them.' The scheme lets people save up to £4,000 every tax year towards buying a first home or entering into retirement, with the government adding a 25% bonus on top. 'That means you could get a chunky £1,000 of free cash annually, plus you earn interest on whatever you save, and as it's an ISA, that interest is tax-free.' But Mr Lewis warned grandparents must set up LISAs in their children's names, as the recipient must be un der 40 years old but over 18. It also has to have been opened for a year to be able to use it towards a first home. Mr Lewis said: 'A LISA can be opened by anyone aged between 18 and 39. Grandparents can help their children or grandchildren buy a home through the scheme (Picture: Getty Images) 'You can use it to save up to £4,000 a year, towards either a first home costing up to £450,000 or for retirement, and the state adds a bonus of up to £1,000 a year on top. 'If you're pushing 40, make sure you open one before you hit the cut-off age. 'You can continue to put money into the LISA until the day before your 50th birthday (once you're 50 or over you'll continue to get interest or investment growth/losses but you won't be able to pay in anymore).' Any interest made on LISA savings is tax-free as it is an individual savings account (ISA). If you already have an ISA, some providers will allow account holders to transfer money from that into a LISA. Mr Lewis has warned there is a penality if any cash is withdrawn which isn't used fo){kind=link}
NEWS… BUT NOT AS YOU KNOW IT
Martin Lewis has issued urgent advise to stop grandchildren missing out on £1,000s of free cash.
The money saving expert has urged people to set up a Lifetime ISA (LISA) for their grandchildren which can help them buy a first home.
His website said: ‘For (grand)parents wanting to help their (grand)kids buy a home, giving them cash to put in a LISA is a great way to do it – though they’ll need to open the LISA account themselves as you can’t do it for them.’
The scheme lets people save up to £4,000 every tax year towards buying a first home or entering into retirement, with the government adding a 25% bonus on top.