Nottingham Building Society launches Lifetime Isa to rival Skipton
Nottingham Building Society has become just the second provider, following Skipton Building Society, to offer a Cash Lisa for savers
SAVERS will soon have more choice over where to stash their cash for a first home or retirement as Nottingham Building Society has announced the launch of a new Lifetime Isa (Lisa).
It becomes just the second provider, following Skipton Building Society, to offer a Cash Lisa for savers.
Like Skipton, the account will pay just 1% and it will be available from August 28.
Applications will initially be in-branch only with an online version due to go live before the end of the year.
Nottingham Building Society has 67 branches across 11 counties, with most located in the Midlands.
Unlike normal Cash Isas, Lisas aren't all about the interest - their perk is a 25% bonus on savings up to a maximum of £1,000 a year until age 50.
What is a Lifetime Isa?
Here's how a Lifetime Isa (Lisa) works.
- You can use a Lisa to buy your first home or save for later life.
- You must be 18 or over but under 40 to open one.
- You can put in up to £4,000 each year, until you’re 50.
- The government will add a 25% bonus to your savings, up to a maximum of £1,000 per year, until you're 50.
- You can hold cash or stocks and shares in your Lisa, or have a combination of both.
- You can only withdraw money from your Lisa if it's to buy your first home, if you're aged 60 or over or you're terminally ill, with less than 12 months to live
For more help, visit our What is a Lisa? guide.
But just last month, MPs called for the Lisa to be scrapped due to its "perverse incentives and complexity".
Anna Bowes, co-founder of savings advice site Savings Champion, commented: "Over a year after the launch of the Lifetime Isa (LISA) and Skipton Building Society’s domination of the Cash Lisa market, it’s great to see that Nottingham Building Society will finally be adding some competition, albeit among ongoing speculation that the Lisa is to be scrapped.
"However, disappointingly it's simply matching Skipton Building Society, offering an uninspiring 1% tax free/AER.
"Having said this, the interest earned is the cherry on the top as the 25% bonus is the real prize, dwarfing any interest that is applied.
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"It would be a shame to see this valuable tool removed from the Isa stable – and we hope that Nottingham’s move will inspire other providers to follow suit."
Nottingham Building Society chief operating officer, Simon Taylor, added: "With up to £1,000 of free cash bonuses available for savers every year, it’s no surprise there have been over 170,000 Lifetime ISA accounts opened since it was launched by the government in 2017.
"It’s a genuinely beneficial savings product and we are proud to be carrying out the required investments to make it available to our members."
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