Who loves some tax saving and money back?
I wanted to share some valuable information about the First Home Savings Account (FHSA)—a new and powerful tool available to help first-time homebuyers save for a home more efficiently.
What is an FHSA?
The FHSA is a tax-advantaged savings account introduced by the Canadian government to help first-time homebuyers save for a down payment. It combines the best features of an RRSP and a TFSA:
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Contributions are tax-deductible (like an RRSP), which can reduce your income taxes.
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Withdrawals for your first home purchase are completely tax-free (like a TFSA).
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You can contribute up to $8,000 per year, with a lifetime limit of $40,000.
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Unused contribution room can be carried forward (up to $8,000/year), making it flexible and easy to catch up if needed.
Why Open and Maximize an FHSA?
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Tax Savings – Get a break on your income taxes now while saving for your future home.
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Faster Growth – Investments inside an FHSA grow tax-free, helping your money grow faster.
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Stack with RRSP – You can use both your FHSA and RRSP under the Home Buyers’ Plan for an even larger tax-free down payment.
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No Repayment Required – Unlike the RRSP Home Buyers’ Plan, withdrawals from an FHSA do not have to be repaid.
My Recommendation
If you’re eligible, opening an FHSA as soon as possible allows you to start accumulating contribution room and taking advantage of the tax benefits right away—even if you’re not buying for a few years.
If you’d like help setting one up or have questions about your next mortgage strategy, I’d be happy to walk you through the options.
Call me to connect and get on that home ownership journey 🙂