42% of employers will provide access to the Lifetime ISA, research finds

guidance

The new Lifetime ISA (LISA) will be available from April 2017 for individuals under the age of 40, which can be used for buying a first home or for retirement. The introduction of the LISA has raised some important questions for the future of pensions and long term savings.

One question which is being discussed is - will the LISA be introduced within the workplace as part of a reward package? WEALTH at work, a leading provider of financial education, guidance and advice in the workplace, carried out a poll and found that 42% of employers who responded will provide access to the proposed LISA through their reward packages.

Jonathan Watts-Lay, Director, WEALTH at work, comments; “It is great to see that many employers will provide access to the LISA through their reward packages. As we know, the workplace already supports employees with various savings vehicles to help them with their short, medium and long term savings goals. This includes workplace ISAs, share schemes and pensions. Such variety allows employees to choose a savings method, or a combination of methods, which are the most appropriate for them at a given point in time, so I see no reason why the LISA wouldn’t be a great addition.

In fact, saving into a LISA can actually help employees to save for a deposit faster than using a savings account, and that by getting them into the savings habit; it may also actually increase their pension pot.”

He continues; “Employers will need to think about how they can support employees who all want to save in different ways. For example, we already see many companies giving employees a percentage of their salary to buy ‘benefits’ so could this be a method of funding the LISA in the future?”

He concludes; “Whether employees decide the LISA or another savings method is right for them, the need for financial education, guidance and advice has never been more apparent.”

Reward and WEALTH at work are blogging about financial education, savings and retirement options. FOLLOW THE SERIES HERE

Wealth at Work