60% of under 40s plan to open Lifetime ISA

A panel of current investors aged 18-39 said they are attracted to the Lifetime ISA by the government bonus, with 88% naming this as a reason for opening an account. Over a third (35%) said they like the flexibility of a product that enables them to save for a first home and retirement, while over one in ten (13%) said they like the idea of the withdrawal charge, as they will not be tempted to take out their money too soon.

76% told The Share Centre that they believe the Lifetime ISA will encourage more young people to save for their future.

Darren Cornish, Director of Customer Experience at The Share Centre, said: “If you are aged 18-39 and looking to supplement your pension savings or save for your first home, the Lifetime ISA is a fabulous opportunity.

“The government bonus on offer makes the Lifetime ISA very attractive to younger investors, with up to £32,000 in ‘free’ money available if you are able to open an account at 18. Also, if you invest in stocks and shares through your Lifetime ISA, there is the prospect of investment returns too, all free of income tax and capital gains tax (although your capital is at risk and you could get back less than you paid in). If you have more to save you can subscribe to any of the other types of ISA, provided the total doesn’t exceed the (2017-18) £20,000 allowance.

“What really excites me about the Lifetime ISA is that it is a great chance to get to understand investing in the markets. We will make that very simple and clear, but with time on the side of those aged between 18 and 39, the earlier they start investing the better.

“For all of these reasons, we are enormously enthusiastic about the new Lifetime ISA and look forward to welcoming a new generation of investors.”