You can use your Lifetime ISA to help fund your retirement and access your funds without a withdrawal charge from the age of 60.
Getting ready for retirement
Once you reach your 50th birthday, you'll no longer be able to pay into a Lifetime ISA or receive the government bonus. However, your Lifetime ISA savings will still earn interest, or investment returns if you have a Stocks & Shares Lifetime ISA.
Any money you keep in the Lifetime ISA after you turn 60 will continue to earn interest tax-free and you can make as many withdrawals as you like without being charged.
Things to consider
If you decide to use your Skipton Online 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.
Lifetime ISA or pension?
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 you may wish to consider investing 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, or both. While 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 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 any employer contributions 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).