Deadlines are arriving for prospective homeowners who want to transfer funds between two different types of individual savings accounts (Isas).
Rules currently allow savers to transfer existing funds from a Help to Buy Isa into a Lifetime Isa without affecting their annual allowance.
This could mean more in government top-ups, although the move might not suit every saver.
Rules will change from April, when such a transfer will no longer be possible.
Providers have set deadlines to make a transfer now, with the only cash Lifetime Isa, provided by the Skipton Building Society, requiring a transfer by the end of Friday.
Other firms offer stocks and shares Lifetime Isas and have similar deadlines in the coming days.
These Isas are designed to help people save for a first home and come with a government top-up, which could end up being bigger for those who transfer.
However, Lifetime Isas need to be held for a year before they can be used to help buy a home, so experts say that those planning to buy imminently may be better off sticking with the Help to Buy Isa. There is also a wider choice of cash saving options with the Help to Buy Isa, for those who do not want more risky investment of their savings.
- Launched in April 2017
- Savers must be 18 or over, but under 40 to open a Lifetime Isa
- Up to £4,000 can be put in each year, until the age of 50
- The government will add a 25% bonus to these savings
- The money should be saved to buy a first home, costing up to £450,000, or as pension savings
- So the bonus will be lost if the money is not withdrawn to buy a first home or otherwise taken out before the age of 60 (unless the saver has only 12 months to live)
Help to Buy Isa
- Launched in December 2015
- Savers must be 16 or over and saving up for a first home to open a Help to Buy Isa
- It is possible to deposit up to £1,200 in the first month after opening
- Up to £2,400 a year can be put in, after this first deposit
- The government will top-up with a 25% bonus between £400 and £3,000
- The money is only released on completion of buying a home, costing up to £250,000, or £450,000 in London
The Lifetime Isa is the newer product of the two, but there has been relatively little take-up among providers.
The Skipton is the only one to allow cash savings in a Lifetime Isa, and pays an interest rate of 0.75%. It describes the rate as “sustainable” although it remains well below the rate of inflation.
Kris Brewster, head of products at the Skipton, said he was surprised at the popularity of the Lifetime Isa.
“Customers have a desire to be homeowners, and a significant ability to save,” he said.
The building society said 64,787 cash Lifetime Isa accounts had been opened, with an even split between men and women.
The average account-holder was aged 26, and typically had £1,609 saved. Of these customers, 72% were saving for a home. 13% for retirement, and 15% for both.