If you decide to use your Skipton Cash Lifetime ISA to save towards retirement, you should consider:
- when you intend to retire
- what other provision for retirement you are making (for example contributions to a pension); and
- whether a Cash Lifetime ISA will meet your savings goals. For example, will it provide you with sufficient income in retirement?
As your circumstances can change over time you should regularly review whether the type of Lifetime ISA you hold is still right for you.
A Cash Lifetime ISA may not be the best option for retirement savings. It’s generally accepted that saving for retirement is a long term commitment and it could be better to invest in stocks and shares. However, this will depend on your personal circumstances, including your attitude to risk. You could invest in a pension or stocks and shares Lifetime ISA. Whilst the value of your investment is at risk and can fall as well as rise, it may be possible to receive a better return from a stocks and shares based product over the long term (more than 10 years) than you would from a savings account.
If you are employed, you should consider the potential availability of a workplace pension scheme through an employer which provides employer matched contributions, and your tax position. If you save in a Lifetime ISA instead of enrolling in, or contributing to, a pension scheme from your employer or personal pension scheme:
- you may lose the benefit of contributions by an employer (if any) to that scheme; and
- your current or future entitlement to means tested benefits may be affected (these depend on the amount of income and capital you have, which includes savings).
Please be aware that the information we have provided is not advice. If you’re considering varying your existing pension arrangements as part of a decision to invest in a Lifetime ISA, you should seek independent financial advice before making any changes. If you don’t fully understand the pension and tax rules when making changes, you may not optimise your retirement savings and may face an income shortfall in retirement.