14 March 2024 , 10:09
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Martin Lewis is encouraging everyone born between 1985 and 2006 to put £1 in a bank account as soon as possible.
The Money Saving Expert shared this advice during a Budget Special edition of the ITV1 and ITVX Martin Lewis Money Show on Tuesday, March 12. He focused on helping young people buy a house later in life. Many are unaware of a government-backed savings scheme that assists young people in buying a house worth up to £450,000.
Martin revealed he tried to persuade Chancellor Jeremy Hunt to increase this limit, but nothing has yet been done. He said: "I think it's unfair and it's not your fault house prices have gone up since 2017 but the LISA hasn't and you were encouraged to do what you were encouraged to do. And he didn't do anything."
If you're aged 18 to 39 and don't own a home, Martin suggests putting money into a Lifetime ISA (LISA) account if you plan to buy a house worth up to £450,000 in the future. These accounts are offered by all major banks like HSBC, NatWest, Halifax and others, each offering different interest rates but all qualifying for a government bonus, reports Yorkshire Live.
You can save up to £4,000 every year in a special account until you're 50 years old. But you need to put money in before you turn 40. The government will then give you an extra 25 per cent on top of what you save, which could be as much as £1,000 every year. You get this bonus after your account has been open for a year. You don't need to keep the money there all the time, so you can start your account now and add more money later to get the bonus.
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If you take out the money without saving it, you have to pay a fee of 6 per cent. But if you start your account with just £1, you only risk losing 6p. Martin explained: "You may as well put £1 in now in case you want to use it in the future. Then the clock's ticking and it's been open a year. Great if you have kids and you want to put money in for them - get them to put a quid in now. The clever thing to do right now."