Whereās the 250k cap outside of London stated? That should only apply for the Help to Buy, not LISA
I just checked your right the limit is under Ā£450K for both inside and outside London for the LISA ( only applies to the help to buy scheme ) ! My bad 
Thanks for correcting me though 
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Which is effectively the equivalent of waving the 6.25% penalty that applies when it goes back up to 25%ā¦
How does lowering the penalty work in practice?
If you put the maximum Ā£4,000 into a LISA in a given tax year, youād receive a 25% (Ā£1,000) bonus, so the balance would be Ā£5,000.
Prior to the Governmentās change, if you withdrew your funds early, you would be charged 25% of the balance, which recoups the bonus plus an additional charge (equivalent to 6.25% of the money you put in). So youād get back Ā£3,750.
Now, with the charge at 20%, youād get back the full Ā£4,000 ā this is the money you originally put in.
Does the penalty also apply to investment gains? Or just to the original amount?
Both gains and original amount
Today I realised that my Freetrade ISA is now just a holding pen for funds that are waiting to go into my AJBell 
LISA at the start of the tax year when the LISA allowance resetsā¦ and that makes me sad.
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Today, I have had to recommend yet another friend to open their account with HL because of the LISAā¦ 
For a non :freetrade: customer, the lack of LISA means :freetrade: can be up to Ā£1,000/year more expensive then HL.
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Do not you find that LISAs not even being on the roadmap makes :freetrade: look completely out of touch with their target customers and the value proposition a bit 
considering:
- LISAs create so much value for young investors over their lifetime and that without one every year that passes, they can lose up to Ā£1,000/year
- 123 votes now for this product offering āIdeaā
- the last FreeTrade communication in this chat room wasā¦in May 2019
How can one prone the saving of Ā£100-200/year in account charges as a reason to open a :freetrade: account when one does not even offer a Ā£1,000/year guaranteed profit for those willing to save Ā£4,000/year in a LISA ? 
We save you Ā£100-200/year but you miss out on Ā£1,000/year 
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You donāt miss out on Ā£1000 a year when you can just use any other LISA providerā¦
You just lose the difference in price. Ie HL vs what Freetrade would charge.
Youāre also forgetting that a LISA locks up your money until you retire or buy a house. For those who are home owners or have a partner who has owned a home this means a LISA is effectively a pension. I agree itās a great product but to say itās more important than a normal ISAā¦ I have to disagree.
āYou donāt miss out on Ā£1000 a year when you can just use any other LISA providerā¦ā:
If in āIdeasā covered in the community forum of :freetrade: we replied with the fact itās perfectly OK for everyone to take their business elsewhere, away from :freetrade: then why would such topics, forum or company even exist? One could even say, letās close down :freetrade: and take our business elsewhere, we would not lose out on anything if we did not even have :freetrade: to compare with. The point of this Ideas forum is to ask for features that will make people move/open accounts with :freetrade:
The basics of choice/decision theory teaches all its students costs-benefits analysis. Those who consider opening/moving their brokerage account nearly always think: āLetās assume I do all my business with this broker. What do I get net of everything I pay for/receive if I do all stock dealing with this broker?ā. Apart from a very few people who have several brokerage accounts, most people think like this and they do not think: Iāll have my ISA and SIPP @ :freetrade:, my GIA @ II and my LISA @ HL. So, if they want a LISA, they will not move to / open their ISA, GIA and/or SIPP @ :freetrade: . Indeed, they would not miss out on their Ā£1,000/year of LISA top-up without moving from HL to :freetrade: but itās irrelevant as we want them to move just as we want to be able to move all our brokerage account types to one provider.
So, after a cost/benefits analysis of having all their brokerage accounts/wrappers (GIA, ISA, LISA, SIPP) in 1 place, considering opportunity costs, people should be better off moving to :freetrade:. Thus, in this cost/benefits analysis, not having a LISA @ :freetrade: for those who want one and are considering moving/opening an account, the up-to Ā£1,000/year is indeed a cost in their simulation, even if ājustā an opportunity cost, and having several brokerage accounts is most of the time not a use case in the simulation.
ābut to say itās more important than a normal ISAā¦ I have to disagree.ā
No one is saying āLISA is more important than a normal ISAā but yourself so I guess you are disagreeing with yourself. Indeed, one can put every year:
- Ā£15k in a normal ISA
- Ā£4K + Ā£1K top-up in LISA
ā¦and if one only has Ā£4K/year to put in and is happy with locking their money in for years to then buy a house or just wants the Ā£1K top up without touching the money until theyāre 60 or even longer (leave as inheritance to their heirs) then it makes total sense. Moreover, they might also have other tax-free investments SEIS/EIS/VCT with much shorter lockup periods and are happy to lock this money up for a longer time. It is neither more nor less important, it is another type of wrapper, with a different time horizon and reward profile in exchange for lockup. Indeed, just as āCashCowā, most LISA holders also have a regular ISA a GIA and sometimes a SIPP.
I have just explained to two people what a LISA was, including the lockup constraint, and they rushed to HL to open their LISA account and transfer to / open a SIPP and regular ISA with HL. Why? Because :freetrade: does not offer LISA and the risk-free Ā£1,000/year opportunity cost far outweighed all other :freetrade: benefits in their back of the enveloppe calculation. The Ā£1,000/year item was even the biggest one and is so for most people.
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Freetrade only just launched the SIPP, which is likely better for everyone than the quite niche LISA. I hope to see it too, but I donāt think they are not listening, there is just a lot to build.
You overcomplicated what was a simple explanation. You first response was about people losing out on Ā£1000 a year specifically because Freetrade doesnāt offer a LISA and toms said you dont lose out as you can open a S&S LISA elsewhere. This is correct, this is correct for any question of this type. The only reason youād lose out on money is if you were silly enough to not open a LISA when you wanted to open one. The broker is of no consequence, either you want to use that product or you dont.
youāre talking about choice benefit theory and cost benefit analysis like thatās what people doā¦ when people want to open a LISA they google LISA and open one with whichever link looks best at the time, thatās the real world.
Freetrade cant magic a product out of thin air, so as @toms says, if you want to open a LISA then open one, the only way you lose out on the Ā£1k is if you choose not to.
Ā£4k in the LISA, Ā£16k remaining in your ISA allowance
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Why?
Easy, āfreeā money. LISAs are horrible and should be scrapped as all they do is bump up house prices, but no reason not to pass up free money. Iāll be dumping money from freetrade into my LISA as well (itās a cash one though).
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The Ā£1k is not risk free, like it is with ISA.
Deposit 4k and donāt invest into anything. Realise you need money back.
With ISA, you get Ā£4k out.
With LISA, you get Ā£3.75k out due to 25% hit off the total Ā£5k normally.
The withdrawal fee was reduced to 20% temporarily to make cashing in LISA result in Ā£4k back too. That was introduced due to coronavirus and is due to return back to normal on 5th of April.
Unless Rishi extends the reduced penalty again in this upcoming budgetā¦
So LISA is a bad advice if one doesnāt plan to buy property, is not first time buyer, will buy property for above the cap, or is not planning to keep it invested until retirement.
Nonetheless for me LISA does make sense, and I do ISA transfer of Ā£4k from old ISA into LISA each year to collect Ā£1k bonus. (If I can!) Whilst keeping most of my ISA accessible.
What?
The whole point Alban is making is why would someone set up a FT account to save 100 in fees when they canāt set up a LISA - which gives them 1000 free a year.
People will just go to HL instead and FT miss out on that customer.
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Then this argument is completely flawed and doesnāt take into account the differences between LISAs and ISAs which have now been brought up in this thread.
I genuinely have no idea what you are on about - so letās agree to disagree. 
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Haha fair enough.
I hope you are right and LISA will soon be on their official to-do list/backlog
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