The long-awaited First Home Savings Account (FHSA) has arrived at SCU! An FHSA is a registered savings account that allows you, as a prospective first-time home buyer, to save up to $8,000 annually ($40,000 lifetime) that can be used toward the purchase of your first home.
Here are three ways to make the most of your savings with an FHSA.
1. Tax-free savings, tax-free withdrawals
Whether you’re just starting to think about saving for your first home or you’ve already begun your saving journey, the new FHSA provides the tax-reduction benefits of an RRSP with the tax-free growth of a TFSA. Contributions and interest earned are non-taxable when withdrawn and used toward the purchase of your first home, which means you can keep more money in your pocket.
Hot tip: Accelerate your savings by combining an FHSA contribution with your TFSA savings and your RRSP through the Home Buyers Plan (HBP).
2. Choose your investment option
Choose how you want to save based on your unique saving goals. Contribute monthly and watch your savings grow with a variable rate FHSA or take advantage of higher interest rates with a GIC, available in 1- to 5-year terms. Or, enjoy the best of both worlds by contributing to a variable rate FHSA throughout the year and then locking your funds into a GIC term.
Hot tip: Easily set up equal automatic deposits and you’ll never have to worry about going over your annual or lifetime contribution limits.
3. Set yourself up for mortgage success
An FHSA can bring you peace of mind by allowing you to focus on what really matters—finding your dream home. When you’re ready to purchase your first home, our SCU lending specialists will guide you through the process of exploring the mortgage solution that’s right for you.
Hot tip: When it’s time, your pre-approval meeting is a great opportunity to ask questions and explore your mortgage options. Download this checklist to help you get ready to meet with your SCU lending specialist.
Interested in learning more or opening up your FHSA?
