Lifetime ISA Advice Same As Normal ISA

Lifetime ISA Advice Same As Normal ISA.

In a unsurprising move, the Financial Conduct Authority (FCA) has today confirmed its approach to regulating advice,  promoting and sale of the new Lifetime ISA (LISA).

What is a Lifetime ISA?

Available from 01/04/2017, the Lifetime ISA was announced in Budget 2016 and is designed to allow people under the age of 40 to save or invest flexibly to either provide a deposit for a first home or save for retirement.

In addition, a 25% government bonus will be added to the LISA when you cash it in for house purchase or retirement.

The FCA will regulate LISAs in the same way as other ISAs, with marginal additional changes to reflect that the LISA has two alternative objectives, house deposit or long term savings. 

The usual quotations, cash flow modelling, suitability and affordability and risk warnings will apply to LISAs as they do to ISAs.

Comment

All makes sense although we worry that younger savers may divert part of their real pensions savings towards LISAs.  That said, flexibility for us all to be able to access pensions is key.