CostPrioritize the FHSA first if you're starting from scratch — its contributions are tax-deductible like an RRSP, but withdrawals for a home are never taxed and never need to be repaid. The RRSP Home Buyers' Plan is best used for money you'd already saved for retirement, since it must be repaid over 15 years.
How the FHSA works
The First Home Savings Account, introduced in 2023, lets first-time buyers contribute up to $8,000 per year and $40,000 lifetime. Contributions are tax-deductible, just like an RRSP contribution — but unlike an RRSP, qualifying withdrawals used toward a first home are completely tax-free and never need to be repaid. It combines the upfront tax deduction of an RRSP with the tax-free withdrawal of a TFSA, which is why it's often the best first stop for first-time buyer savings. Unused contribution room can carry forward, and the account can stay open for up to 15 years or until you turn 71.
How the RRSP Home Buyers' Plan works
The Home Buyers' Plan lets you withdraw up to $60,000 from an existing RRSP, tax-free at the time of withdrawal, to put toward a first home. The catch is that it's technically a loan from your own RRSP: you must repay it over the following 15 years, with a minimum of roughly 1/15th of the withdrawn amount due each year starting the second year after you withdraw. Miss a year's repayment and that year's minimum amount gets added to your taxable income instead — a detail that trips up more borrowers than you'd expect.
See your full 15-year repayment schedule on the RRSP Home Buyers' Plan calculator.
Using both together
Combined maximum for a couple, both first-time buyers
| FHSA (each, $40,000 lifetime) | $80,000 |
| RRSP HBP (each, $60,000) | $120,000 |
| Combined potential down payment funding | $200,000 |
The FHSA and RRSP HBP aren't mutually exclusive — you can use both for the same home purchase, and this is exactly what makes them powerful together for a couple. See your projected FHSA balance and refund on the FHSA calculator.
Which to prioritize
If you're saving new money and haven't touched either account yet, the FHSA generally comes first: the tax deduction is identical to an RRSP's, but the withdrawal is truly free money with no repayment obligation, versus the HBP's 15-year repayment clock. The RRSP HBP makes the most sense for money you'd already accumulated in an RRSP for retirement and are choosing to redirect — since that money exists already, borrowing it back to yourself under the HBP rules is usually better than leaving it untouched while you save a down payment from scratch elsewhere.
Model your FHSA growth on the FHSA calculator, or see your RRSP HBP repayment plan on the RRSP Home Buyers' Plan calculator.