Boro Boy wrote:
Unemployed, on low income - give us your money to lock up for 4 years and we'll give you some money back tax free (as it would be anyway!)
I bet all those rich low paid workers and highly paid unemployed are going to be queuing up for this government Save If You're Penniless Scheme...
What bright Government Bod thought this one up?
It's to encourage saving, and it's an incredibly generous way to do it. Most people can save £5 a week here or there. Put £20 a month into this, and the government will give you half of it back in two years, shift that into a lifetime cash ISA and they'll top it up by another 25%, then continue saving for a further two years, get half back again and close the account, put the entire balance into said lifetime ISA and continue to save £5 a week for the rest of your days and you'll have a chunky little wodge of cash to help you when you hit 60.
£20 x 24 = £480
Government bonus = £240. Put this into lifetime ISA and they'll top it up to £300. You've now got £780 saved.
A further £20 x 24 = £480. Now the account expires. You've saved £960, the government give you a further £240, put the entire balance into a lifetime ISA, get 25% boost so that takes it to £1500, plus the £300 you've got in there already.
£1800 saved in 4 years for forgoing a fiver a week - you only actually pay in £960.
If it helps even a few people learn to save, then it will have achieved it's purpose, I think it's a brilliant idea to help the lower paid.