The First Home Savings Account is the best account Canada has launched in a generation, and it's still under-used. The reason it's special: it stacks the two tax breaks that every other account makes you choose between.
Why the FHSA beats everything else
With an RRSP, contributions are deductible but withdrawals are taxed. With a TFSA, withdrawals are tax-free but contributions aren't deductible. The FHSA gives you both: a tax deduction when you contribute, and a completely tax-free withdrawal when you buy your first home.
Free money, literally
The rules in plain English
- ›$8,000 per year, $40,000 lifetime. That's the ceiling.
- ›Carry-forward: open an account and you start earning $8,000 of room each year. Unused room carries forward up to $8,000, so you could put in $16,000 in one year.
- ›15-year window: you have 15 years from opening to use it for a home, or until you turn 71.
- ›No home? No problem: roll it into your RRSP/RRIF tax-free, without touching RRSP room.
The move almost nobody makes
Open the account now, even with $0. Your annual room only starts accumulating once the account exists. A 25-year-old who opens an FHSA today — even without contributing — is building room they can fill later. Waiting until you're ready to buy means leaving years of carry-forward on the table.
Stacking with the Home Buyers' Plan
You can combine an FHSA withdrawal with the RRSP Home Buyers' Plan for the same purchase. Between the two, a couple can assemble a very large, tax-advantaged down payment — the FHSA portion entirely tax-free, the HBP portion as a repayable loan from your RRSP.
Where to open one
Wealthsimple offers a self-directed FHSA with no account fees and $0 commissions, so every dollar of your contribution goes to work. Estimate your refund and growth with the FHSA calculator before you contribute.
