Newcastle Building Society has launched a cash Lifetime ISA at a variable rate of 1.10% Gross/AER.

The tax free lifetime individual savings account (LISA) can help first time buyers saving for a deposit, and those saving for retirement, attracting a 25% government bonus on amounts saved each tax year to a limit of £4,000 per year (£1,000 bonus).

Stuart Miller, customer director at Newcastle Building Society, said: “Helping people own their home and plan for the future is core to our purpose, and Lifetime ISA helps both these sets of savers.

“Encouraging and rewarding personal saving is a key step in starting to address the culture of easy credit and consumer debt that has become prevalent and ultimately reduces the ability of individuals, couples and families to save.”

Customers who are interested in opening a cash LISA with Newcastle Building Society can open one online with just £1.

Miller added: “We understand how hard it is for people to save a deposit for a home and similarly, how saving early for retirement can make a material difference to financial security in later life.

“The 25% government bonus could help people between 18 and 39 significantly add to their personal saving, with as much as £32,000 available to those who save the maximum amounts permitted.”