Yes! When it comes to registered savings account options for your first home purchase in Canada, the FHSA is, on paper, more advantageous than the Home Buyers' Plan. Firstly, you can use up to $40,000 with the First Home Savings Account vs $35,000 of your RRSP savings using the HBP for a first home purchase. Secondly, the FHSA doesn't require you to repay the amount withdrawn, whereas the HBP mandates that you put back the withdrawn amount within 15 years from withdrawal.

All your contributions (maximum of $8,000 a year and $40,000 lifetime) into your FHSA reduces your taxable income similar to an RRSP. Of the money you invest or seek out interest or income,  you earn this tax-free similar to a TFSA. When it comes to withdrawal to purchase your first home, they don't need to be paid back. And you can contribute up to $8,000 each year, up to a max of $40,000 in total.

Perhaps  the main 'disadvantage' of FHSAs is that you must purchase a house within 15 years of opening one. It doesn't necessarily mean you will lose your savings and the tax benefits if you don't use the funds to purchase your first home as you can roll your FHSA contributions into an RRSP without impacting your RRSP contribution room.

The Home Buyers’ Plan has a “minimum holding period”. Unlike the HBP, the FHSA has no limitations as far as a minimum period of time that money must be held in your FHSA before contributions can be withdrawn.

According to the federal government rules: "Your maximum participation period begins when you open your first FHSA and ends on December 31st of the year in which the earliest of the following events occur: the 15th anniversary of opening your first FHSA; you turn 71 years of age; the year following your first qualifying withdrawal from your FHSAs."

Although as a parent you can't contribute directly to your child's or grandchild’s FHSA, you can gift the funds to that child so they can make a deposit into their own personal FHSA. The main consideration is that all the benefits and tax deductions will be in the name of the child and none attributed to the parent or grandparent.

According to the federal government rules on December 27, 2023: "you must not have acquired the qualifying home more than 30 days before making the withdrawal. You must be a resident of Canada from the time that you make your first qualifying withdrawal from one of your FHSAs until the earlier of the acquisition of the qualifying home, or the date of your death."

The FHSA adopts an important feature of the Tax Free Savings account which is that all your investment gains are "tax-free". On the other hand, with the FHSA, similar to an RRSP you get a tax deduction for your contribution made whereas with the TFSA you don't get a tax deduction. Lastly, the FHSA only allows a maximum contribution of $40,000 lifetime whereas the TFSA allows continuous contributions beyond $40,000. Ultimately whether the FHSA is better than the TFSA depends on your investing and saving goals. However, if your main goal is to put a down payment on a home and get a tax benefit today for doing that, the FHSA is a great way to start. Keep in mind as well, you can also use the TFSA to add to the $40,000 you use from the FHSA to have a bigger down payment...if you had already started using a TFSA to save.

Only the individual qualified FHSA holder can contribute to their own account — not a spouse or common-law partner. Similarly, if the spouse gifts money to their spouse, only the eligible First Home Savings Account holder (spouse) can claim the accompanying tax deductions for contributions to the account.

If you use your FHSA to make your first home purchase, you can withdraw the entire amount from your account tax-free similar to a TFSA. However, there is a lifetime limit of $40,000 and an annual limit of $8,000. When you make a withdrawal, the investment income or interest earned is added to the amount you contributed. It's always good to make a plan that takes into account your overall financial picture.

Just like a Tax Free Savings Account, you can get standard interest rate like you would in a savings account at your local bank. However, you can invest in other types of investments like mutual funds, GICs, stocks and bonds which would be related to your appetite for risk and how long you need to save the money for. To find the "best" rate of return you require it's important to have a conversation with an advisor like Blue Alpha Wealth.

Yes, similar to a TFSA and RRSP, you can have multiple First Home Savings Accounts. As long as you remain within the yearly maximum of $8,000 and the lifetime maximum of $40,000, you can have as many as you want. One way in which you could use multiple FHSA accounts is to spread out the risk of investing your money. Because you want to grow your money more than the bank interest rate you can use $4,000 for example to buy medium to long term (5 years) investments like mutual funds and stocks. You can then use the remaining $4,000 to buy more 'safer' investments like a Guaranteed Investment Certificate (GIC) that pays a reasonable interest rate for example 5% compounding for 5 years. 

For a legally recognized union or common-law status in Canada, homeownership applies to both partners regardless of whose name is on the deed. However, if you do have an FHSA when you get married or become common-law, you will still be allowed to contribute to it if you wish, and its timelines and rules will remain the same.

According to the FHSA primary residence and qualified withdrawal rules, a property you intend to live in and partially rent out could qualify for a tax-free withdrawal, but only if it is primarily used as your home and secondarily as a rental property.

As the name suggests, the First Home Savings Account, the use of the plan can only be applied to your "First Home" and based on your age and residency. In addition, any withdrawals you make can only be used towards the purchase of a qualifying home. Otherwise, your withdrawal would be taxed unless it's transferred without affecting your contribution room to an RRSP.

Not directly. An FHSA can only be opened and be for the use of one qualified person as who is at least 18 years old, a resident of Canada and as long as you haven't lived in a qualifying home owned by either yourself or your spouse or common-law partner either this year or in the previous 4 calendar years. Another individual can gift you money to make a contribution but they will not have the tax benefits attributed to them.

To withdraw your funds, you must follow the qualification rules which establish that you be a first time home buyer buying or building a qualifying home in Canada, have a written agreement to buy or build before October 1 of the year subsequent to the year you make the withdrawal and intend to move in within a year of buying and building. You can withdraw funds from your FHSA for the purchase of your first home at any time. Funds must also be used to purchase, build or renovate a qualifying home within 15 years of the date of application.