See here for an explanation of ISAs and LISAs: http://www.bbc.co.uk/news/business-37318001Current life situation26F, married, no children yet. Husband studying, I'm earning (self-employed, not loads so in a low tax bracket now). Husband graduates next year and then starts working (he's not interested in RE, super-passionate about his career) and we get a house with his job. Hoping to have children in the next few years and then I will take maternity leave and see how I feel about staying at home vs working, but I imagine I will go back to work part-time in due course.
Financial goalsWe don't have a defined FIRE plan at the moment, and who knows where life will take us, but as well as "saving as much as we can" there are some things in our future I think we ought to prepare for:
- To eventually buy a house to live in when husband retires (probably at 65 but I suppose things might change) - either to buy when he retires or to buy earlier and rent out if it seems like an opportune moment. Probably in the south-east where house prices are very high because that's where friends and family are.
- For me to be able to say no to freelance jobs for non-financial reasons (either staying home with kids or just because the job sucks) without worrying about it
- General financial security in short and long term (money for emergencies and for retirement)
- For husband to be able to retire earlier if things change with his work (which it's looking like they might) from 2035 onwards
Current savingsApprox £7000 in a SIPP
Approx £45,000 in a stocks and shares ISA
Approx £10,000 in some kind of mutual fund (gift from my grandmother, don't really understand it but it does OK)
BIG QUESTION: Should I invest in a LISA when they start next year?I currently pay £50/month into my SIPP as a sort of diversifying hedge, but all of our other savings go into the S&S ISA. In the future I anticipate saving between £6000 (young children, picky about work) and £12000 (no children, work as much as I can) a year, so I could put £4000 into the LISA and the rest into the S&S ISA. I'll only be able to withdraw from the LISA if we buy a house for us to live in (either at 65 or earlier if husband suddenly wants to retire early, but will definitely happen at some point in our lives) or we reach age 60 (which, obviously, we will do at some point). But I don't know if the free money (free bonus £1000 for annual £4000 contribution up to a maximum of £32,000 free bonus money, plus then grows normally as a stocks and shares investment) is worth the lost flexibility - or whether it's worth it because we'll have the S&S ISA which we can access at any time so we can spend that down if necessary and afford to wait to access the LISA at age 60.
(I don't think the state pension will disappear by the time I get there, but I anticipate our costs will rise as we age and get less able to do things for ourselves, so I'm currently viewing that as our "old person extra money for taxis and higher heating bills" and not counting it in when I calculate future expenses.)