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Lifetime ISA - one month on

  • 13,319 HL Lifetime ISA accounts opened so far
  • Tracker funds are popular with Lifetime ISA investors
  • 18% of Lifetime ISA investors are aged 39

Danny Cox, Chartered Financial Planner, Hargreaves Lansdown:

"Thousands of younger investors have voted with their feet and selected a Lifetime ISA in the short time since the new addition to the ISA family became available on 6th April. The LISA may not be widespread in terms of providers yet, but the demand for the new product is clearly there from savers.

The new account builds on the success of the ISA franchise with a generous government bonus, so it is little wonder it’s proved popular. Indeed so far we’ve seen a large number of 39 year olds opening an account to keep the door open for further LISA contributions, with accompanying government bonuses, throughout their forties.

So far Lifetime ISA investors have shown a propensity for investing in tracker funds, which makes sense seeing as passive funds tend to be more popular with the younger generation. Some of these savers may also be relatively new to investing, and so a tracker fund offers a simple and low cost way to get broad market exposure. Interestingly the most popular passive funds with LISA investors so far all track overseas indices, suggesting a preference for international stock markets.

Neil Woodford’s new fund has also garnered interest amongst Lifetime ISA investors, as they seek to roll up the income stream for long term total returns, to which end his existing fund is also one of the most popular with LISA savers."

Top ten most bought funds by HL Lifetime ISA investors (alphabetical order):

BlackRock Emerging Markets Equity Tracker
CF Lindsell Train UK Equity
CF Woodford Equity Income
CF Woodford Income Focus
Fundsmith Equity
Jupiter India
Legal & General International Index Trust
Legal & General US Index
Lindsell Train Global Equity
Stewart Investors Asia Pacific Leaders