The First Home Savings Account (FHSA) has been live since April 2023, and by 2026 it's clear: for eligible first-time buyers, the FHSA is the single best tax-advantaged account in Canada.
The three accounts in one table
- FHSA: $8,000/year, $40,000 lifetime. Contributions deductible (like RRSP). Withdrawals tax-free for first home (like TFSA). 15-year time limit.
- RRSP: 18% of earned income, max $32,490 for 2026. Deductible. Withdrawals fully taxable. Home Buyers' Plan allows up to $60,000 tax-free but must be repaid.
- TFSA: $7,000 for 2026, cumulative room since 18. Non-deductible. Tax-free growth and withdrawals. No time limit.
The 2026 priority order (for first-time buyers)
1. Employer RRSP match — fill to the match. Free money. 2. FHSA $8,000 — deduction + tax-free first-home withdrawal. Best of both worlds. 3. RRSP up to your bracket — especially if you're in the 38%+ band. 4. TFSA — lifetime tax shelter; max if you have room. 5. Non-registered — for anything beyond.
Why FHSA first
You get the RRSP-style deduction (saving 30-50% of contribution in marginal tax) AND the TFSA-style withdrawal for a qualifying first-home purchase. No repayment required (unlike HBP). Unused room carries forward 1 year only — don't miss it.
The FHSA time limit
The FHSA must close in the earlier of: 15 years from first contribution, age 71, or end of year after first qualifying withdrawal. If you don't buy a home, you can roll it to RRSP/RRIF tax-free — no tax loss.
For non-first-time buyers
Skip FHSA. Order becomes RRSP match → RRSP (if bracket > TFSA-withdrawal-tax) → TFSA → non-registered.
Combining FHSA + HBP
You can use both for the same purchase. FHSA up to $40,000 + HBP up to $60,000 = $100,000 tax-advantaged down payment support.
Our tool
The Canadian Retirement Calculator lets you model FHSA + RRSP + TFSA contributions side-by-side across your working years. Run the numbers — for most 25-35-year-old Canadians on the path to a first home, FHSA-first is a clear win.