Fidelity International has launched a new Lifetime ISA (LISA) that will be available to members of its workplace pension scheme.

The Fidelity LISA, which is expected to launch in March 2023, will be available to clients through Fidelity’s Invest@Work service, which allows members to save into a range of personal investing accounts alongside their pension.

The LISA will enable for members aged between 18 and 39 to save and invest up to £4,000 every tax year towards a first home or retirement, with the government topping up the annual amount saved by 25 per cent each year.

According to Fidelity’s Global Sentiment Survey, 86 per cent of people aged between 20 and 29 saw buying a property as a life goal for them.

“Workplace pensions are just one part of the picture when it comes to members’ personal finances and life goals,” commented Fidelity International head of workplace distribution, Dan Smith.

“We are seeing more and more clients redesigning their benefit packages to provide their members with greater choice.

“The Fidelity LISA is an important addition to our range of investment options that give members the flexibility they need to achieve their financial ambitions.

“In particular, it will help members save towards their first home or retirement while benefiting from the government’s top up scheme.”

The benefit of a LISA as an alternative or addition to pensions for retirement planning was also highlighted by Hargreaves Lansdown.

It noted that someone paying £1,000 a year into a LISA from the age of 18 could accumulate almost £104,000 by the time they reach 50.

Furthermore, someone contributing £4,000 a year could end up with £415,000 by the age of 50, according to Hargreaves Lansdown’s calculations.

“If you are aged under 40 then a LISA could play a major part in your retirement planning,” said Hargreaves Lansdown head of retirement analysis, Helen Morrissey.

“The 25 per cent bonus is a significant uplift to your savings, which over time and added to long-term investment growth could see you accumulate a tidy sum.

“LISAs can also be an attractive alternative to pensions for groups such as the self-employed who are not covered by auto-enrolment.

“The 25 per cent bonus boosts their retirement saving in a similar way to basic rate tax relief and for those who don’t benefit from an employer contribution then it’s an option worth considering. Another important factor is the ability to access the money in a LISA in times of stress.”

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