In his last Budget as chancellor, George Osborne outlined the launch of the Lifetime Isa.
But since then, the government only confirmed the Lifetime Isa would go ahead late last year and it took until March 2017 for HMRC and the FCA to publish its final guidance on what the Lisa will look like.
As a result, only a handful of providers have confirmed they are planning to offer the Lisa this year and only four providers have a product available from 6 April.
Lisa or no Lisa?
Hargreaves Lansdown was one of the first to announce its intention to provide the Lifetime Isa.
Danny Cox, head of communications at Hargreaves Lansdown, says: “We expect the HL Lifetime Isa to be the only product available to investors on the first day of the new tax year that offers a full range of funds and shares, and can be managed online, by phone, smartphone and tablet.”
The Share Centre, Scottish Friendly and True Potential have all revealed they will offer stocks and shares Lisas, while Skipton Building Society has been the first provider to commit to offering a cash-only Lisa.
Foresters Friendly Society, meanwhile, will offer its members a Lifetime Isa which will invest in its with profits fund.
Paul Darlow, head of proposition development at Xafinity, explains: “There are two types of Lisa – those enabling you to invest in cash (and earn predictable interest) or those enabling you to invest in stocks and shares, where the return is non-guaranteed and your money is at risk.”
He cautions stocks and shares Lisas are generally not appropriate for those who are looking to invest for only a short period of time.
“So those people who are looking to buy their first home in three years, say, won’t really have any new options from 6 April 2017,” he adds.
High street offering
Niki Patel, technical consultant at Technical Connection, acknowledges the options for savers who do want to take out a Lisa are limited.
“Most major banks will not be offering a Lisa from its launch date in April - Skipton Building Society will offer it from June but other banks appear to be uncertain as to whether they will offer it at a later date,” she says.
“There are some investment platforms which will consider offering the Lifetime Isa although, aside from Hargreaves Lansdown. For most it will not be available immediately from 6 April 2017.”
Among the providers which have chosen to get a Lifetime Isa to market, the feeling is the product will be valuable to those with an objective of buying a first home in the next five years or so.
Kris Brewster, head of products at Skipton, suggests: “Never before have we seen a savings account that gives such a boost to people saving up to buy their first home.
