One in three adults under the age of 40 are saving to buy their first home and get a foot on the property ladder, but research from Cushon has found that less than half (44.1%) are taking advantage of top up bonuses offered by the government.
The workplace savings and investment provider revealed that of those saving to buy their first home, only 13.2% are saving into a Lifetime ISA, while 30.9% are putting money into a Help to Buy ISA – the Lifetime ISA’s predecessor.
Of those surveyed who are saving to get onto the property ladder, 31.8% indicated they are saving into an instant access account, while 25.5% said they are saving into a fixed rate savings account. One in five (20.5%) are saving into a cash ISA while another 7.7% are saving into a stocks and shares ISA.
With interest rates at an “all time low” a Lifetime ISA would help savers get onto the housing ladder quicker.
The Help to Buy ISA was closed to new applicants in November 2019 but the Lifetime ISA currently offers a 25% government top up bonus up to £1,000 per year on any savings, as long as the money is used to purchase a first home or for retirement.
“With a 25% government bonus it is the ‘no brainer’ product for the under 40s looking to get on the housing ladder and could really speed up the reality of purchasing a home for a lot of young people”.