Martin Lewis fan explains how they got free £6,000 bonus for house deposit

16 August 2023 , 10:09

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Martin Lewis has long spoken about LISAs (Image: ITV)

A couple has explained how they used a tip from Martin Lewis to get £6,000 for free to put toward their first home.

Steven and Jade used a Lifetime ISA (LISA) to get Government bonuses while saving a deposit to get on the housing ladder. LISAs give you a free 25% cash boost from the Government if you're saving for your first home or retirement.

You can save up to £4,000 each tax year, meaning the maximum bonus you can pocket is £1,000. Anyone who is aged 18 to 39 can open a Lifetime ISA for free - and if you're in a couple, you can open one each.

This is exactly what Steven and Jade did. Writing in to MoneySavingExpert.com, the couple said: "We opened a LISA each and deposited the max £4,000 for three years. We saved £24,000 in total - gaining a bonus of £6,000 between us.

“We combined this with other savings to put down the deposit for our first home. Thank you for your help getting us to this stage in our lives."

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If you're planning on opening a LISA, there are some things you need to keep in mind. First of all, you need to be 18 or over but under 40 to open one of these accounts, although you can keep paying in until you’re 50.

You also cannot use your LISA money for anything other than buying your first home or retirement. You'll pay a penalty if you take money out of your LISA account for anything other than these reasons.

The penalty you'll pay is 25% on withdrawals - this means you can get back less than what you're paying in. If you’re buying a property, the value of the home cannot exceed £450,000.

You can take your savings out of a Lifetime ISA when you’re 60 or over, if you’re using your cash for retirement. You can choose between a Cash LISA or a Stocks and Shares LISA and the interest earned on your savings is tax-free.

Read our guide on all the other ways you can save for your first home.

Levi Winchester