Money expert Martin Lewis is urging people to put £1 in an account now in order to get a bonus from the government worth thousands of pounds.
Martin, returning on his The Martin Lewis Money Show Live on ITV1 and ITVX, has urged everyone who is aged 18 to 39 – so born between 1985 and 2006 – to deposit £1 in a Lifetime ISA account right now.
The reason is because Lifetime ISAs offer a huge bonus paid by the government to first time buyers, worth £1,000 for every £4,000 you save for a house, but that bonus is only paid after a year.
So in order to make sure the scheme is open to you as soon as possible, Martin says you should pop £1 in a LISA as soon as you can.
Speaking on his show, Martin explained: “Lifetime ISAs, for individual first time buyers aged 18 to 39 – I say individual because if you’re buying with a partner and you’re both first time buyers, you can have one each.
“A 25 percent bonus is paid on up to £4,000 you save in it so that’s a possible grand a year added, and you can use it on any house under £450,000, or you can wait until you’re aged 60 and take it out and you’ll still get the bonus too.
“Even if you are 18 now, if you have never bought a home, you have to have a Lifetime ISA open for a year before you can get the bonus.
“Just put a quid in. Even if you don’t think you are going to use it, put a quid in now, and then, tick tock tick tock tick, you’ll go over that year limit, and when you want to put the money in, you can get the bonus instantly because you will have had it for a year.
“It’s a way to jemmy the system.”
But Martin did caution that this is only for people who plan to buy a house worth under £450,000 or who can afford to leave the money untouched until they are aged 60 otherwise due to the risk of a penalty from the state for taking the money back.
He added: “But if you withdraw for any other reason, annoyingly, even if you’re buying a house over £450,000, which I’m campaigning to change but I’ve failed on the last three Budgets, you’re effectively fined by the state 6.25 percent, so for every £1,000, you’ll get £937.50 back on your grand, so you need to make sure you’re buying a house under £450,000 before you put money in.”