FHSAs: Don’t Turn Down FREE Money

FHSAs can be the ultimate no-brainer if you’re eligible to open one and are saving to buy your first home. Learn about them!

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FHSAs—I beat my head against the wall. I’m meeting so many young people—haven’t bought a home yet, want to buy a home, don’t even know what an FHSA is, much less have opened the account. I don’t think people are grasping that if you put $8,000 into this and you’re in a 30 percent marginal tax bracket, it’s $2,400 you get back from the government. Let’s say both spouses are doing it it’s $4,800. But when you pull it out, you don’t pay tax on it. Meaning that’s $4,800 free dollars. And you could theoretically do that every year until you hit the max over five years. That’s $4,800 times five. Are you kidding me? That is $24,000 for free!

And if you don’t buy a house, it just goes into your RRSP.

That’s right. There’s no downside and it doesn’t even affect your contribution limit. Like this is truly the ultimate no-brainer we’ve ever had is the FHSA.