ISA v LISA – which one should I have?

I’m and rent. I took out a Help to Buy ISA when they were launched. Would switching to one of the new Lifetime ISAs be a good decision?

Both were designed to make saving for a deposit easier. The Help to Buy (HTB) ISA would add 25 per cent to your pot but you can only save up to £2,400 a year. The Lifetime ISA (LISA) lets you save £4,000 a year, plus you can invest lump sums and the bonus is paid annually – monthly from 2018/19 – so you earn interest on it. The HTB ISA can be transferred into the LISA and if you do this in its first year, it won’t impact on the £4,000 you can save in 2017/2018. But it depends when you plan to buy your property. The LISA must be open for a year before you can withdraw and get the bonus, so if you’re going to buy sooner, stick with the HTB ISA as you only need £1,600 in it to use it and get a bonus. The LISA lets you buy a property up to £450,000 anywhere in the country; the HTB ISA has a limit of £250,000 (£450,000 in London). However, if you move your HTB ISA over to a LISA this year you’ll be able to buy a higher-value property. You can hold other ISAs as well as a LISA but the total you can save across these products is £20,000 a year.