Lifetime ISAs (LISAs) vs pension

[Laquila]

Is there a hidden catch with LISAs? Is there a disadvantage to using it as a sort of starter pension, e.g. putting in the max p/a (£4k) from the earliest you can, on the basis that you have to stop at 50 and can't get it til 60?

Say you managed to do that, from 18-50 - you'd put in £128k and would get another 25% from the gov, so +£32k, =£160k in total. On top of that you'd get a bit more interest, I guess, depending on the rate.

That wouldn't be a bad single-person pension pot, depending on retirement outgoings/other investments, I guess, and would be very low risk - are they actually really popular and I'm just late to the party?!

Money in a pension pot isn't counted as part of your general assets. So it's protected from creditors, can't (usually) be seized if you're declared bankrupt and isn't counted as savings when applying for things like grants, bursaries and benefits - Universal Credit for example.

Savings in a LISA are just treated as part of your savings - with the added disadvantage that you have to pay a penalty if you're forced to access them early.