Nutmeg is waiving portfolio management charges for new customers in a bid to encourage them to invest through a Lifetime Isa.
Customers can make an initial deposit of £500 into “LISA 333 funds”, plus 11 deposits of £333. This takes investors to just over the maximum Lifetime Isa allowance of £4,000, with customers paying no portfolio management charges on funds invested.
The LISA 333 funds will then be converted into a Lifetime Isa once the product formally launches in April 2017.
Nutmeg chief executive Martin Stead says: “By beginning to build that £4,000 pot now, customers will benefit from compounding returns immediately.
“The Lifetime Isa is a powerful way to save – the Government is offering up to £1,000 free to savers each year. It’s a great way to encourage people to start saving young.
“We know saving for a deposit is important to under-40s and we expect this to engage young people in a way that saving for a pension never has.”