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Discover the FHSA: Your best ally to become a homeowner! 

Do you dream of stepping through the door of your future home as a homeowner? The First Home Savings Account (FHSA) is here to turn this dream into a reality! Designed to alleviate the financial burden of purchasing a first home, the FHSA is an unparalleled toolbox for saving smartly and efficiently. 

Let's decipher together the top ten benefits and everything you need to know to navigate the world of the FHSA with ease.

The Top 10 Benefits of the FHSA 

  1. Tax-free net gains: The money you earn in your FHSA - whether it be through interest, capital gains or dividends - remains untaxed, even when withdrawn. 
  2. Generous annual contribution limit: For 2023, you have the right to deposit up to $8,000 into your FHSA each year.
  3. Unaffected contribution to social programs: Neither the amounts invested in the FHSA nor the withdrawals, affect your eligibility for government programs such as employment insurance. 
  4. Flexible withdrawals without penalties: Need money quickly? No problem, you can make withdrawals from your FHSA at any time and without tax consequences. 
  5. Restoration of contribution room: If you withdraw funds, your contribution room is readjusted the following year. This way, you can replenish your FHSA without any worries. 
  6. Carry-forward of unused contribution room: Unused contribution room carries forward from year to year, giving you the opportunity to contribute more later. 
  7. Possibility of diverse investments: Whether you prefer mutual funds, stocks or bonds, the FHSA welcomes a variety of investments to meet your needs and risk appetite. 
  8. Simplified transfer to your beneficiaries: In the event of death, the funds in your FHSA can be transferred to one or more beneficiaries without taxation. No age limit for contributions: You can contribute to your FHSA regardless of your age, as long as you have contribution room. 
  9. No age limit for contributing: You can contribute to your FHSA without considering your age as long as you have contribution room.
  10. Ease of use and accessibility: Opening an FHSA is easy at most financial institutions, and its management does not require being a finance expert. 

10 Essential Things to Know About the FHSA 

  1. Cumulative contribution room: You have a cumulative contribution room from the first opening of the FHSA, up to a maximum of $8,000 per year. 
  2. Opening conditions: To open a FHSA, you must be at least 18 years old, a Canadian resident and have a social insurance number. 
  3. Primary goal: The central ambition of the FHSA is to promote savings accumulation for the purchase of your first home. Learn about the difference between the FHSA and the HBP through you RRSP.
  4. Tax vigilance points: Beware of subtleties, such as excess contributions. 
  5. Protection against creditors: Depending on your province of residence, your FHSA may be protected in the event of bankruptcy. 
  6. Transfer between FHSAs: You have the option to transfer your funds from one FHSA to another without affecting your contribution room, provided it is done directly between institutions. 
  7. Use of funds: Withdrawn funds must be used to purchase your first home to avoid tax penalties. 
  8. Independence from spousal income: The FHSA does not affect your spouse's income, unlike other types of joint accounts. 
  9. Waiting period after withdrawal: After a withdrawal, you need to wait for the following fiscal year to regenerate your contribution room. 
  10. Overcontribution: Beware of contributions that exceed your contribution room, as penalties may be applied. 

The FHSA is your strategic ally for laying the foundations of your real estate project. Embark on the adventure with the certainty of having a financial partner designed to help you make your dream come true. Your journey to homeownership starts here!

Start saving with the FHSA today!

Not sure where to start? A financial planner can help you open a FHSA account and take advantage of this exceptional financial tool!
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