Second cash Lifetime ISA to launch next week
Nottingham Building Society will launch its cash Lifetime ISA next Tuesday – making it only the second provider to offer this type of savings account, which offers a 25% bonus towards buying your first home or retirement.
In addition to the 25% Government bonus, the account will pay 1% AER variable interest.
Initially you'll only be able to open it in one of Nottingham's 67 branches, spread across 11 counties including Cambridgeshire and Yorkshire. However, the building society says its Lifetime ISA will be available online "before the end of the year".
Lifetime ISAs (LISAs) were launched to great fanfare in 2017, but Nottingham Building Society is only the second provider to offer the cash version of the account, alongside Skipton Building Society, which also pays 1% interest. The only other LISAs currently available are stocks & shares LISAs which come with added risk – the likes of AJ Bell, Hargreaves Lansdown and Nutmeg offer these.
See our Lifetime ISAs guide for full info on how they work and who they're best for.
What's a Lifetime ISA?
Here are the Lifetime ISA need-to knows:
- A LISA can be opened by anyone aged 18-39.
- You can save up to £4,000 a year.
- You get a 25% state bonus paid on top (up to a maximum of £33,000).
- You'll pay a penalty if you withdraw the cash for anything other than your first home or before you turn 60.
For first-time buyers a cash LISA can be used towards the purchase of a property worth up to £450,000.
If you're using it to save for retirement, you can save in it until the day before your 50th birthday, and withdraw the cash and bonus when you turn 60.
For more details, see our full Lifetime ISA guide.
What do we know about this new LISA?
Nottingham's LISA will be available from Tuesday to open in one of its 67 branches.
Other account features include:
- It can be opened with £10.
- Interest is paid annually.
- You won't be able to transfer into your LISA from any existing Lifetime or Help to Buy ISAs.
Jenna McKenzie-Day, the building society's senior product manager for savings, said the Lifetime ISA has been one of its "most talked about savings products".