First Home Saver Accounts | First Home Saver Accounts

mischa10 - It's good but is it enough?

| | 2008-04-08 06:20:12

i think it is a good step in the rite direction but i'm not sure it will let me save enough? where i live properties are still going up in value

ahmed

| | 2010-12-24 11:10:36

4 years law is a very bad law. When I opened the account I did not know that if I buy a property in between 4 years then the money will go to super. I reckon this is going to be very good if the law changes and allows the first home savers account holders to send their money to the mortgage not in the super. By the way I had to go thru a lot of trauma with this money which I kept in first home savers account.I signed a contract with a builder in 2009 and I went to ANZ bank to get my first home savers account money and then I was told by ANZ that I this law does not allow me to withdraw money before 4 years. Please change this law and please change it quickly. The tresure Mr. Wayne Swan said in May 2010 that the law will be changed but 7 months gone and the law has not been changed. Please change the law quickly and give us an opportunity to buy a house.

Sarah Guiver

| | 2008-04-14 20:32:02

Is this scheme available for us if we want to buy land and build our first home?

Abhishek

| | 2008-04-29 18:10:41

yes it is

Kwasik - salary sacrifice scheme

| | 2008-07-14 08:02:53

Is this available for salary sacrifice scheme

Chad R - Salary Sacrifice

| | 2008-10-01 22:40:20

No, deposits must be made after tax.

thomas - mr

| | 2008-04-15 12:14:58

hi i think its a great idea but the minimum four years is too long.. a three year minimum would attract far more people to the scheme..

Mark - Four years too long

| | 2008-05-20 20:27:48

Yes, I agree, coming up with a deposit is not that big a deal, even on a modest income - offering a strong incentive to start saving is what young people need. I think it should be possible to draw the money out after 24 months, or at a monetary threshold (Say $40,000) rather than four years regardless of what you have put in

Miranda - Too Long

| | 2008-07-16 00:18:14

Please don't put a time restriction on this - I have already been saving for 6mths and hoping that I can continue to put as much away in the next 12-18mths to afford deposit on a modest apartment. I have been looking up the first saver since heard about it in March thinking this might be the break I need but four years would make it useless to me - really disappointed.

Michelle

| | 2008-10-24 04:44:38

I agree. What if I find the perfect house next year? There should be no time restriction

Matt Fallon

| | 2008-04-16 08:47:54

I like the idea, but I also find the 4 years too long - it may be good in the future (for people just starting to save now) but I have been saving for 18 months already. I feel I will be able to buy in 1-2 years and it upsets me that although I have been doing everything I can the government will just overlook me

Anonymous - people who already saved are l

| | 2008-04-17 23:48:52

I agree with Matt. It may be good start for someone just beginning to save but, but for those of us who have already been saving for a deposit by putting away our hard-earned AFTER-TAX money only to be taxed again on the interest, there is no benefit to us at all!!!
Many people are well on their way and do not need another 4 years but still fall short of a deposit. I think there needs to be some kind of retrospective payment for people who can show regular savings in the past for a home deposit. And there should be no minimum period of time to hold the money there.

Phil - phil

| | 2008-05-07 02:50:43

Miranda - Phil

| | 2008-07-16 00:23:54

Phil - either you have really gone without to get anything you could in life or you bought a house when they were 45K, not 450K - please understand that cost of living is higher now than it has ever been. I can't think of one handout I have received from the Govt and yet GST, Super, HECS are all being paid out of my salary; all things my parents generation didn't have to worry about. I am extremely fortunate to be living in this country - it is much worse in almost every other country; however if this Govt can afford to have surcharges because we are all paying income & GST taxes and offer this kind of assistance i think its only fair that they do it right - without a time limit.

Bengt - Welfare for the wealthy.

| | 2008-10-01 07:32:15

I am a bit puzzled to why the scheme would exclude people who have been saving for years (and paid tax on their earned interest) and are ready to buy soon. While at the same time the sceme would mean that a wealthy family could qualify to get $850/year/child from the government by meerly transfering $5,000 into an account of each of their children every year. (and many of them will do this!!)
I would like to suggest the following changes to the scheme.
1) Scrap the 4 year limit. It is unfair.
2) Ensure that the $850 goverment subsidy (17%) is linked to the person saving from their earnings rather than just by receiving money from a rich family member. I don't think we need to provide goverment support to the already wealthy.

aspen - Re: $850 subsidy

| | 2008-10-27 22:28:18

Hi

Sorry - abit off teh topic, but could I have more info on this $850 govt subsidy please - where do I find more info? Ta!

Aspen

Matt Fallon

| | 2008-04-16 09:01:15

Also what happens if you do buy before the 4 years? Is the money then put into super? or Given to put on your house? I dont understand why there is a time limit anyway...

Yes it stops those that are well off using it as a method of getting a little more cash before they purchase there 1st home - But those that are well off will see it as a good way to get some extra cash into your super!!! and with the govt contributions favouring those on higher income tax levels this will let them get some money that the govt does not give with the super co-contribution (As it cuts out at about $50g). Why give with one hand and take with the other!

Leif Frauenfelder

| | 2008-04-16 09:09:42

Its a really good idea...but what about for us young people who are trying to get a head start now....u talked about that hypothetical that that girl would have a certain amount of money by the age 29...I'm currently 18, and just wanting to set my future now.... so this idea doesn't really work for me

Matt Fallon

| | 2008-04-18 08:08:10

Leif it works really well for you - Im not sure what more you are after. If you are 18 then 4 years of saving will be great for you timewise and lets you, as you say, set your future now.

LocalHero - 4 years is nuts

| | 2008-04-19 22:59:13

This scheme is only really attrractive to the very young. I plan to but in the next 4 years and having the money locked away is not attractive.

Melissa - I agree 4 year minium is too l

| | 2008-05-14 00:26:31

I agree that 4 years is nuts. I would not want to be locked in for that long with the only way of getting your money is via superannuation. What if i meet a partner who aready has a house? Then is a waste of money. I should at the very least A) use the balance for a house earlier than 4 years B) be able to get the principle back in the case i no longer require for a home, interest could be rolled into super and the goverment could take their contribution back.

ED	\| \| 2008-10-04 00:48:13

I agree - it is attractive if you are in your teens and want to start saving for the long term. I'm 25 and have already been saving for a while. It will not take me 4 years before I can afford a deposit, more like 18 months/ 2 years. It is disheartening that this scheme won't help. It is targeted at a very narrow section of the community.

Louise - What company is behind this we

| | 2008-04-26 20:58:59

Hi there, could you advise what company or agency is operating this website? Thank you

Kylie - Why not for investment if it i

| | 2008-04-27 19:57:19

Rick - early access - for couple

| | 2008-04-28 14:37:01

hi there,

in the FAQ section, I read the following:

My partner wants to buy a house next year. If I open a First Home Saver account, can I get access to the funds if we buy a house together?

It is possible for your balance to be released even if the four year conditions has not been met, if the account provider is satisfied that your partner meets that condition in respect of their own account.

My question is, what is this means?
"if the account provider is satisfied that your partner meets that condition in respect of their own account" ?

as in, as long as the couple have enough money for the down payment in their FHSA, they can access the money tax free?

please reply.

thanks

Tracey

| | 2008-05-05 21:13:16

I was a bit confused by this too and I am not certain I have got this right but this is what I assumed it meant when it says "the account provider is satisfied that your partner meets that condition in respect of their own account" means your partner must have had their account open for four years. So the scenario quote "My partner wants to buy a house next year" doesn't mean next year as in 2009 it is a question someone would be asking in say three years time. Does that make sense? Do others take it that way?

Lyndsay - nah they've got you there

| | 2008-10-16 07:00:19

No what I believe that means if your partner has held their FHSA for 4 years and then pulled the money out and you have only had yours for 2 yrs, you can take it out but one of you has to have filled the 4 yr requirement. Crap I know!!

Ken Lee - why 4 years?

| | 2008-04-29 00:30:11

why locked 4years?
when it first introduced should start with 1 year or less locked for person who started already.
1year later 1year, 2years 2years
should be 4 years or more after it introduced minimum period of 4years,

Or no minimum period.
why 4?
4years for next election?
4years for property investor?

karen - 4 year election

| | 2008-10-26 04:49:32

for us 18year olds who may not buy for 10 year,what happens in 4 years and rudd out. are contributions scrapt

karen - 4 year election

| | 2008-10-26 04:56:10

NO MORE CONTROBUTIONS

Rowan - Too restrictive for those who

| | 2008-05-07 06:31:57

Why restrict the use of this account to those who are needing to save for at least four more years? This needs to be made available to those of us who are a year or two away from accumulating an adequate deposit. We have been saving hard under the current economic conditions and should not be excluded because we have already made a start to saving a deposit.

john - So many questions

| | 2008-05-13 17:46:08

Can we transfer from one FHSA account to another provider? This is necessary to avoid banks hiking fees or lowering interest rate in the 2nd year.

Is the money guaranteed in the case of a bank or building society going bust?

Unused funds should not go to super. They should be returned but taxed at normal marginal rates.

What is this going to do to house prices when thousands of FHBs are withdrawing their money in 2012 an all bidding on a small number of houses for sale with $80K in their pocket. hint- expect house prices will go up by the same amount cancelling out any benefit of the scheme.

Investment returns should be guaranteed. Most young people are not aware that the sharemarket can provide negative returns even after 4 years, especially in this environment.

So much more needs to be investigated, by people with a bit of knowledge how things work.

Donna

| | 2008-05-14 01:25:34

I don't see the point at all. Funds added have to be after-tax money, so first you are paying your standard rate of tax on your money and then adding it to an account that if you choose not to use to purchase a house is going to be added to super and taxed again at the standard contributions tax rate, and all for the advantage of earning an additional $750 pa if you earn between $40,000 - $80,000. What a waste of time.

If the government wants to help, abolish stamp duty for all first homers and increase the first home owners grant to a more realistic amount based upon savings accrued at the time of the purchase or allow access to preserved super at the time of purchase.

Paul van der Loo - I see a house, I buy it I lose

| | 2008-05-19 03:29:24

I found there was a major disincentive to using this scheme in the FAQ the other day.

For example

"Is there a minimum time period that money is tied up?
First Home Saver accounts are designed to encourage people to develop good savings habits, and a requirement is that before an individual can withdraw their funds the account must have received contributions of at least $1,000 in each of four or more financial years."

My problem is I am a single income saver, I'm already saving but this scheme would help me to save more as I get taxed on my current savings. I already exhibit the ability to save but would still be subject to the 4 year term. Should I find a house at the right price before the 4 years I can't use the money I put into this scheme to pay for it. Not only that but it would go into my super instead, so I'd be in a worse financial position as financially it is better to pay off a home loan quicker than to put money into super.

So effectively I'm locked into 4 y...

Dani - It's not 4 years!!! It's 3 y

| | 2008-05-19 19:02:47

Taken from the official website:
"To withdraw their funds, minimum contributions of $1,000 need to be made over the course of at least four separate financial years"

Doesn't that mean you could deposit an amount over 3 financial years and a final amount on July 01 of the next year? (3 years + 1 day)

In the future, you could even deposit on the 30 June of one year, deposit for the next two years and deposit again on 1 July the next year. (2 years + 2 days)

Aren't I correct?

Jacob - 2 years + 2 days

| | 2011-09-11 12:01:53

I think you are 100% correct.

Greg - other factors at play

| | 2008-05-22 18:57:59

First and foremost, although this new scheme has elements of inflexibility and seems cumbersome in parts, it is good in principle.

It is encouraging a saving culture, higher deposits reduce risks of "negative equity" situations, which seems to be becoming more common in the past year.

I suspect that the housing boom and the subsequent "afforability crisis" has been caused by the unholy alliance of the 4 following factors:

- halving of CGT after 1 year. This should never have been introduced into housing investment. What's the point anyway? Housing investment is supposed to be long term, not a 1 year transaction.
- historically low interest rates
- abuse of "equity mate" and drawing down for depreciating purposes.
- reduced minimum deposit standards, there

I don't consider that negative gearing is a big factor here, it's been around since, well forever. The exception being a shortlived abolition in the 80's and it was quickly brought back in b...

Rob Robse - Good points Greg

| | 2008-05-28 09:57:04

I think you suggest some very good points, often people come out to knock or overtly praise such a Govt scheme as this, when most of us need to take a step back and look at the big picture. Of course the Government is not going to "fix" home affordability in one big stroke, it will take many many years and many many new government policies. However, at the abre minimum, this new saving scheme at least tires to introduce the whole concept of "saving" for a new generation.... whether it will work, well that is another question all-together :)

Sense - My two Cents

| | 2008-05-31 23:17:47

I think the scheme is a great idea but as many have pointed out it does have some major flaws.

* 4 year minimum time frame
* Gets rolled into SUPER
* Contributions come from post tax then is taxed again
* Is open to property speculators
* Only have to live in property for 6 months (open to abuse by speculators)
* Is open to being grabbed in lawsuits
* Is capped
* Tax incentive to save only makes sense for high income earners

I don't see this scheme making much difference to housing affordability. If the government were serious about helping Aussies into their own home they'd

* Crack down on what is at best a cozy little arrangement all levels of government have with developers. At worst it's a corrupt relationship
* Re-regulate the finance sector and enforce the tried and true 3.5 x income limit
* release land to First time buyers at cost (not for profit)
* level the playing field between investors and owner occupiers by either granting OO's the right to claim interest against t...

Trevor McDonald - Mr

| | 2008-06-08 08:08:44

I think you make the most sense, although i do think that it would be far simpler and have more impact if the first home deposit was tax free.

cj	\| \| 2008-06-08 08:17:04

why isn't the minimum $5000 savings tax free and 100% tax deductible?

Tuncay I - Agree

| | 2009-02-15 09:23:12

I think your right on the the fact that the interest should be tax free. 100% tax deductible. Asking for too much. Maybe boost the government contribution to 1,000 a year for 5,000 worth of investing.

Nat	\| \| 2008-06-06 01:21:59

I agree its a step in the right direction for first home buyers. However, I dont like the 4 year minimum idea or that our savings are taxed twice!

Ed	\| \| 2008-06-10 02:31:58

At first glance, this scheme looked good, and I would have opened such an account but having read the conditions, I won't as it has too much potential to leave me in a worse financial position than if I didn't use it. For me, the most significant flaws are that I won't be able to access my money before the four year minimum, and that it will go into super if I bought with other savings.

It also doesn't make sense to impose an limit on total individual contributions. If I were to buy a house on my own, it would be no less expensive than if I a couple were to buy, but my savings in this type of account would have been limited to $75000, whereas the couple could have saved $150000.

I also can't see why I shouldn't be penalised if I don't want to live in my first home. Buying as an investment could give me the same security, but I won't be able to afford to buy near where I work. It would make sense for me to buy further from the city, and rent closer in (less petrol, more time, less pol...

DickD

| | 2008-06-16 08:23:09

This whole 4 year committment thing is ridiculous....personal circumstances can change in 4 years (a number of respondants have already given relevant examples). I don't see why your money should be forced into a super fund if you don't go through with the full 4 years.

If the whole concept is to force savings, or improve savings habbits, why not simply have a normal savings account without any strings attached. Then...to receive the governmet 17%, you should just be able to show that its been there for 4 years. If you can't satisfy this requirement, at least you still have your money,are receiving bank interest and you can do what you want with it.

Forcing the money into super would be a major disincentive for the majority of Australians.

Ultimately, it should be up to the individual to save. If they don't have the responsibility to save on their own without the government forcing them, then after the 4 years, when they do get the money and buy a place, can they be trusted to...

Katie

| | 2008-06-18 18:13:48

Maybe the government should think more deeply into what type of housing they should be encouraging people to save for. As a south east Qld resident, all I hear about is the shortage of housing in our area. Yet, people keep borrowing money from banks to build concrete monsterosities with massive environmental impacts to the surrounding land. The government should be encouraging more eco friendly housing to be built and rewarding those people (with extra schemes and suppliments) who choose to head in that direction.
By the way, capping the solar panel scheme left a bitter taste for me with the Rudd Government.
Does no one realise that if we keep wiping out trees, building massive houses and estates, and building our houses with non renuable energy sources, in a few decades time there will be no clean air for us to breath in our suburbs?
Come on everyone, wake up and start thinking about the planet we live on, rather than the selfish thoughts of your 'dream' home! We have a beautiful...

Melissa

| | 2008-06-18 20:53:03

Kylee

| | 2008-07-13 01:39:58

I LOVE TO BUILD HOME THAT IS ENVIROMENTAL BUT WE CAN NOT AFFORD TO DEPOSIT 1000 IN THIS STUPID SAVERS ACCOUNT i THINK IT WONT WORK. bUT IF I COULD SAVE, MY FIRST HOUSE WOULD BE ENVIRONMENTAL SO WE CAN SAVE MORE ADN INSTEAD OF PAYING MORE

Anna	\| \| 2008-11-26 23:29:21

Re the solar panel scheme cap. My family (av income) invested in solar panels on our house in 1983 when there was no rebate and panels were a higher capital outlay relative to know. Since then all our hot water comes from the panels, which have never had to be repaired in over 20 years. The house is in Melb so much less sunshine than Qld.It has saved us money many times over.
By all means govts should encourage environmentally friendly building practices but it is a bit rich suggesting that households with incomes of >100K can't afford solar panels which ultimately save them money as our family demonstrates.
Australia has become addicted to middle class welfare. The first home savers account gives higher interest than any other term deposit on the market (17% + the account interest of at least 5%) and better short-mid term returns than any other investment I can think of in the current enviro. The downside is the wait time, which favours younger savers. Still with house prices over...

Kristy

| | 2008-06-23 07:18:30

It seems a common theme - There should not be a four year requirement, nor should unused funds be deposited to super. Why can't this account be opened at my current bank I use?
I think it is great saving is being encouraged but why can't we just prove this is being done from current savings and gain rewards/assistance this way? We pay tax on eveything else in life?

maria barreras - mrs

| | 2008-06-28 06:45:39

I thought first home buyers can make contributions to the first home buyer saver account from the pre-tax income which is similar to super in structure? please advise

nhay	\| \| 2008-06-30 08:27:44

i was excited when i first saw an article about this in our community newspaper just yesterday. however, four years is too long, this program is basically useless for those who are planning to buy their first homes this year or the next - like me. why only benefit those who will start their good saving habits now? what about us who have saved years before this and are now ready to buy our first home?

mike H - first home saver - four years?

| | 2008-07-01 09:59:36

Lots of people are talking about the 4 year aspect for the new first home saver accounts. Just for the first 4 yrs of the scheme couldn't the government let people who already have savings, put that into a first home saver account and withdraw it earlier? Like the transitional arrangements for superannuation rule changes? That'd help get more people saving to buy their first home and make this idea a winner.

katie

| | 2008-07-02 01:52:23

So this scheme will allow us to afford a deposit... we still have to pay off the rest of the loan, and with house prices at ridiculously high levels this is just too little. An extra $15 000 or so will not help people to buy first homes in Sydney. If anything it will get people into a loan they can

John - salary sacrifice contribution

| | 2008-07-03 02:00:03

FHSA is gradually losing its attraction. The reason is simply like that most of fund operators are losing money for last half-year. Government contribution is not enough to overweight the bad performance of management fund. If the net return rate is less than after-tax bank interest rate, why first home savers put their money into heavy-regulated fund, rather than term deposit in bank?

Kwasik - salary sacrifice

| | 2008-07-14 08:01:23

Exciting plan. can contributions be used in salary sacrifice scheme.

Thank you

Matthew Bird - Mr

| | 2008-07-16 03:23:15

Your survey does not include a comments section... do you really want to hear from us or do you want a bunch of numbers. The scheme has the right idea, although taxing it at 15 cents in the dollar actually means I will pay more tax rather then less, not very well designed in this regard.

Disappointed - May as well use a normal savin

| | 2008-07-16 10:32:28

This is a good example of someone taking a worthwhile idea and turning it into something pointless. Even if I put the maximum $75k into this account the benefit would be more than eaten up by inflation costs after 4 years. I would be better off using a normal savings account and withdrawing after 2 years!

Graham Barber

| | 2008-07-30 20:27:41

The four year time frame for withdrawals discriminates against those people who have been doing the right thing and saving and are ready to buy in the next few years. The government should be doing more to make houses more affordable like making state governments abolish stamp duty for owner occupiers (was this not suppossed to go with the introduction of the GST?). I know there is a first home owners concession in NSW but it is only up to $500k then phased out. Not too many houses in Sydney under half a million these days....

Fiona Tucker - 4 year minimum for withdrawal

| | 2008-07-30 21:14:14

I also find the 4 year mimimum for this account to be too long. I would like to purchase a house within the next 2 to 3 which would make this account useless to me and many other australians as mentioned in the above comments.

The fact that your forcing people to put their saved money into supperannuation if they choose to purchase a home before the 4 year is rediculous that money should be used for what it was intended that being to purchase a first home. The guidelines to this account dissapoint me as Familys are struggling to save money for a house deposit while paying rent as it is.

Andrew - If your ready to Buy within 4

| | 2008-07-31 21:36:54

I WILL WAIT WITH GREAT ANTICIPATION ABOUT THE DECISION SURROUNDING INDIVIDUALS WHO MAY WISH TO BUY WITHIN 4YEARS. IF IT DOES NOT DISADVANTAGE THESE INDIVIDUALS, I BELIEVE THE IS A LOW RISK WAY OF SAVING A DEPOSIT FAIRLY AGGRESSIVELY.

Devils advocate

| | 2008-08-03 19:11:56

I think the 4 year minimum is appropriate. That is how long it realistically takes to save a deposit. Too many people expect to be able to save for a deposit in a year or two, it is simply unrealistic. And if you can save for a deposit in one or two years, you probably don't need government help anyway. A longer savings timeframe means you can invest it in something with a better return anyway, something that will keep pace or even grow faster than the housing market. It is pointless saving for 1-2 years as your only investment option is cash, which of course will not keep up with house prices.

Anonymous

| | 2008-08-04 05:26:29

What about those who have been saving for 2,3,4 or 15 years already and are getting close but would like say 2 more years of saving?

Devils advocate

| | 2008-08-04 19:15:54

If someone only needs two more years of saving, by putting in the home saver they are only going to get an extra 2x$850 (plus less tax on interest earnt). If they have been previously saving in a high growth vehicle like shares - which they should be if they have saved for a long time - it wouldn't be worth their while selling up and moving it to the home saver as they will incur capital gains tax. If they are so close that they can buy in 2 years time they probably don't need help anyway. All the scheme will mean is they could buy a month earlier than otherwise.
Whenever you introduce something new, someone will have just missed out. If you open it to people for 2 year term then people who want to buy in 1 year will complain. The home saver is a long-term savings vehicle, hence 4 year min is appropriate.

KAREN - CRY

| | 2008-10-26 06:32:09

GOOD ON YOU . BE PROUD TAKE YOUR 21.000 GRANT . SOME PEOPLE DIDNT GET THAT BUT DO THEY CRY POOR ME

Graham Barber - No Time Limit

| | 2008-08-04 20:11:32

I don't buy this argument that people who have been saving and can afford to buy in two years time do not deserve or need help anyway. Why should people who have been doing the right thing and saving probably for a lot longer than 4 years not have the benefit of some extra help even if it is only $850 per year it is better than nothing. Where do they come up with four years from anyway i can tell you on a single income in Sydney it takes a lot longer to save a deposit than 4 years even on above average income. If the scheme is going to be fair for all Australians then there should be no time limit everyone who is doing the right thing and saving to buy their first home should be treated equally.

Anonymous

| | 2008-08-04 20:22:06

But remember this is Labour Government - they look after those who dont look after themselves and punish those who do. They will prob introduce some new tax to get those who buy a house with less then 4 yrs saving!

Devils advocate

| | 2008-08-04 21:14:55

Actually people who have already have substantial savings can benefit more from this than those who do not - so long as they are willing to wait the 4 years. If I had $60000 in cash saved, I could put it in the first home saver account upon opening. Earning 8% interest, I would save about $720 in tax per year having it in the first home saver rather than normal bank account. Then I put $5000 in per subsequent year, each year I would get the $850 on top of the $720 tax savings (which increases each year, ~$900 by 4th year, which note is more than the $850 govt contribution) tax savings. Whereas the person opening the account with no savings to put in initially only gets the $850.

klog	\| \| 2009-03-03 23:49:22

is it not capped at 75000

Anonymous

| | 2009-04-04 21:17:41

Yes it's capped at 75K and also, if you put 60K upon opening, depending on your bank interest, you may not be able to fulfill the requirement that you have to make contributions for 4 years. What'll happen with your money then?

Devils advocate

| | 2008-08-04 21:23:48

Anonymous

| | 2008-08-04 21:44:13

well done you yr 10 economics graduate. Now you have read a book get out in the real world and experience something.

Most people say growth assets have a 7 year minimum timeframe (so should the minimun term be 7 years for this house deposit?)

Inflation lateley is around 4%, online savings around 7%, shares are down what about 20% and housing (depends on where you live) but havent moved far.

So from this high interest saving accounts have done best and are beeting inflation and house price movements - so there is nothing wrong with them and this is the best place to have money if you plan to buy in 1,2,3 and maybe even 4 years - why cant the govt just help these people also! It should have no time frame and just help every1 - or no1

Devils advocate

| | 2008-08-04 23:17:11

In the 'real world', time existed beyond one year in the past (some people seem to forget this), over the last 10 years the sharemarket would have got you 13.3% p/a, residential property 11.6%, high interest savings account 6.4%, CPI 2.9% (source Russell Investments long-term investing report). I dare say the next 10 years won't be much different, as history shows most 10 year periods have similar returns. This is not purely academic textbook stuff, these are real world figures.

If you saved 7 years for a deposit in a conservatively geared (LVR

Devils advocate

| | 2008-08-04 23:19:12

As rocky as the sharemarket rollercoaster has been recently, those poor people in western Sydney losing their homes now would have been ok had they continued saving a bigger deposit and invested it in the sharemarket, at least they would still be in the black overall, and in a few years time will have made back their loss plus some more. Instead they have lost everything and are living in their friends garage. On a small deposit and large loan, all it takes is loss of job or illness and a mild drop in house prices and a family has lost everything.

What is the rush to buy a home when you are going to pay it off for the next 20+ years? Why do people feel they are somehow entitled to govt handouts, even when they are capable of saving enough money for a deposit on their own? Aussies have become a bunch of whingers.

Graham Barber

| | 2008-08-05 00:16:56

I am not really sure what point the Devils advocate is trying to make here, apart from that we should all be investing in the sharemarket (are you a stock broker?). First you argue that those people currently saving "probably don't need help" yet if you are prepared to save for 4 years or more then getting a hand from the Govt is ok, but now we are all a pack of whingers anyway who shouldn't get anything.

I agree with the Devil that no it should not be an emotional matter as to who deserves it or not, that is exactly why taking the time limit off will remove any such feelings from those people who have been saving and want to buy in the next 4 years.

Governments from both sides have acknowledged that one of the best ways of encouraging people to make "forced savings" in the long term is to invest in their own home. Whether it is purchased within or after a four year time frame most people will be paying off the mortgage over at least a 20 year period so your conc...

Devils advocate

| | 2008-08-05 02:43:40

Devils advocate

| | 2008-08-05 02:45:09

I concede perhaps you are right about allowing a waiver on the 4 year rule initially, if only for political popularity. It will open it to abuse from people probably don't need it, possibly push house prices up a tinsy bit, but it will make people happy and any negative effects will be short-term, while the long-term savings culture benefits will prevail.

chewie

| | 2008-08-18 05:39:07

what about the admin costs involved in providing the loan for less than the 4 years? And you would have to check everyones savings history and set a benchmark that needs to be met which might also be costly.

Alex	\| \| 2008-09-18 23:35:07

Could you please provide a list that tells you which banks, super funds are involved in the scheme?

Devils advocate

| | 2008-09-21 22:01:56

ANZ and Commonwealth bank will have accounts ready 1 Oct. There are other smaller institutions, but I have not seen a list.

Chad R - List of FHSA providers

| | 2008-10-01 23:04:31

http://www.apra.gov.au/Policy/First-Home-Saver-Accounts-July-2008.cfm

ADIs and Life Companies that have notified APRA of their intention to offer FHSAs:

AMP Bank Limited - ABN 15 081 596 009
Australia and New Zealand Banking Group Limited - ABN 11 005 357 522
Australian Defence Credit Union Limited - ABN 48 087 649 741
B & E Ltd - ABN 32 087 652 088
Big Sky Credit Union Ltd - ABN 51 087 651 358
Commonwealth Bank of Australia - ABN 48 123 123 124
Companion Credit Union Limited - ABN 82 087 649 947
Defence Force Credit Union Limited - ABN 57 087 651 385
Holiday Coast Credit Union Ltd - ABN 64 087 650 164
Hume Building Society Ltd - ABN 85 051 868 556
Hunter United Employees' Credit Union Limited - ABN 68 087 650 182
Laiki Bank (Australia) Ltd - ABN 44 093 488 629
Mecu Limited - ABN 21 087 651 607
Melbourne University Credit Union Limited - ABN 16 087 651 590
Members Equity Bank Pty Limited - ABN 56 070 887 679
MyState Financial Credit Union of Tasman...

Chad R - more FHSA providers...

| | 2008-10-01 23:05:09

New England Credit Union Ltd - ABN 21 087 650 360
NSW Teachers Credit Union Ltd - ABN 30 087 650 459
Plenty Credit Co-operative Limited - ABN 29 087 651 643
Police Association Credit Co-operative Limited - ABN 33 087 651 661
The Police Department Employees' Credit Union Limited - ABN 95 087 650 799
Victoria Teachers Credit Union Limited - ABN 44 087 651 769
Wagga Mutual Credit Union Ltd - ABN 35 087 650 860
Wyong Council Credit Union Ltd - ABN 29 087 650 897

RSE licensees that have been authorised to offer FHSAs:

Currently no RSE licensees have been authorised to offer FHSAs.

Sara Fraser

| | 2008-09-24 19:01:03

You cant access the money for four years??? That's ridiculous! We are ready to buy in the next couple of years, why should we be penalised for wanting to buy earlier???

Labors farcical populism is si

| | 2008-09-27 21:40:43

Wealthy real estate investors get your chequebooks ready.

An increase in demand not seen since the succession of rate cuts earlier this decade is about to fall upon your fortunes.

Only a Labor government has the contempt for the average citizen to dictate such ridiculous investor welfare policies.

Next up on the chocolate wheel of socialist investor welfare, AussieMac and RuddyMae.

Global financial crisis here we come...

Katie

| | 2008-09-29 02:33:53

Do you have a calculator people can use to put in their contribution, interest rate and time so that they can see the figures?

Steven Shaw - Labour pumps up the property m

| | 2008-10-01 10:45:00

Well, I imagine that the housing bubble will have well and truly burst by next year. Some say that the bottom will be in 2010 (not good for FHSA savers). I reckon it will be more like 2012. This could be good for FHSA savers but remember there will be many FHSA savers in the market in 2012...

This is a waste of tax payer money.

Perhaps tax on savings could be abolished. Someone mentioned above that the FHSAs will be "double taxed" but this is the same for all savings accounts (FHSA will be taxed at a lower rate than most people's marginal rate - 15%). Tax on savings seems unfair because income tax has already been paid once and inflation is not taken into account when calculating "real interest earned". If we didn't tax savings then perhaps our banks would have enough deposits to finance loans and wouldn't need to see additional funding offshore.

Chad R - No Investment style FHSAs avai

| | 2008-10-01 22:55:44

I've been looking forward to opening an FHSA account, but I'm disappointed to see that all the accounts available today appear to be interest-based deposit accounts.
No superannuation entities have issued a product offering yet, which is where I would expect more investment options to be available.
I think it's a great time to buy into equities markets while prices are low, particularly for people with a longer savings time frame, so I'm hoping we will have some decent diversified investment options available for FHSAs soon.

Ains - First Home Buyers

| | 2008-10-03 19:39:56

I think that although it sounds like a good idea on paper it is ludicrous that if you wish to purchase a home earlier than the four years that you cannot access your own money as it must go into your superannuation. Surely the interest you earn could be granted at a lower rate for early withdrawal rather than the government dictating where your savings should go? If you want to add to your super salary sacrifice. If you want to save for a home use a high interest savings account as this is only helpful to those starting out not those wishing to increase their savings potential.

Tiffany

| | 2008-10-06 02:37:48

It all looks good, apart from the four-year restriction... What if I want to buy a home in 2 years? I lose all my savings - i.e. to super, which I can't access for 30-40 years! What value is there in this????

Naomi - 4 years are they kidding?

| | 2008-11-27 00:23:39

Who wants to be forced to wait 4 years? how ridiculous! People should be free to buy when they can why would you put on a restriction of a minimum of 4 years it is obvious that the longer you have the account the benefit from the government you get why should they care if your circumstances enable you buy sooner? I won't be opening an account until they take this restriction off.

Steven Shaw - shoring up the banks

| | 2008-10-06 21:45:26

Naomi, maybe it's more to do with shoring up bank deposits. The more deposits the banks have the less they have to use the wholesale mortgage market. This allows the banks to offer better rates.

I can't see how the 4 years is beneficial to first home buyers.

I heard somewhere it was because FHSA were going to be managed fund account that invest in shares. It perhaps makes sense then however even if you invested in a FHSA investing in australian shares, wouldn't it be up to the good judgement of the person who did so? i.e. not some imposed govt regulation!

Since the only accounts available are _cash_ account, it makes sense to remove this restriction - at least for those cash accounts.

ash - what exactly is 4 years

| | 2008-10-09 23:00:23

The common belief for the minimum savings account period is that of 4 years. However it actually says that you must make contributions in at least 4 financial years. So while 4 calendar or anniversary years seems a long time, this could mean that the minimum time is actually 2 years and 2 days (open your account and deposit $1000 on 30/6/09, then each year after that until your last deposit on 01/07/11 and then close it to buy your home). Can anyone confirm this?

If this is allowable, this raises my next question: if the govt contributions are received after an individual files their tax return (say 4 months after the end of the tax year), then how is the last contribution paid if you do take the money out on 01/07/11 to buy a house? Do you have to make a separate declaration at the time of closing your account to prove you've made that last contribution or do you wait up to 16 months until you file your next tax return?

There's absolutely no information on how this scheme ...

Karen Davoren - AGE RESTRICTION

| | 2008-11-09 20:08:52

Why is there an age restriction? Why can't parents put away money for their younger kids, or even teenagers wanting to save for the future??

Lyndsay - comforting to know others feel

| | 2008-10-16 07:09:08

I would just like to sayit is very comforting to find others in the same position as me. I was very excited when I first heard about this scheme only to be disappointed when I read the fine print. For those in our mid twenties keen to own in less than 4 years it is really not helpful and i love the idea of being able to pull out in 24 months even if it meant slightly reduced interest. At this stage a term deposit is far more appealing. My only point in writing on this site is in hope that someone in authority reads these messages and uses the views of the people to influence ammendments to this scheme.

Amanda

| | 2008-10-16 13:51:53

4 Years is too long to wait and takes the flexibility out of this scheme when compared with what all other savings institutions offer. If it was reduced to 1 year or even 2 I would be very happy to take up this scheme.

katie

| | 2008-10-16 18:54:21

I just want clarification on who pays the 15% tax? In the banks pds it says they are obligued to, but in your online calculator you deduct the 15% tax?

Louise - 4 Year Restriction

| | 2008-10-16 21:42:26

Sorry to say but life just aint that predictable sometimes. For a single person my circunstances will change significantly if I meet a partner. On a single income it is not possible for me to borrow enough money to buy a house but on a double income it is possible. Then buyers need to be responsive to the market, it might be good buying in two years time, we dont know what is going to happen to the market and we need the flexibility to make decisions based on the market and our circumstances not what Government dictates.

Cheers

Mandy

| | 2008-10-18 08:34:27

After 3.5 years (Which is really how long it takes to get into the 4th financial year, yeah?) my hubby and I will have paid over 50K in rent so yeah, I think that negates the advantage of saving with this account. If you've got a deposit in 2 or so years why spend all that money on rent?

storm05 - renting

| | 2008-10-18 08:54:21

why spend all that money on rent?

Because its better than spending double that amount on interest repayments when you could save and invest the difference and have a larger deposit in 4 years time.
Even more beneficial now that house prices are going to be falling over the next 3-4 years.

Sugi - Mr

| | 2008-10-20 01:17:15

The scheme says that this is similar to superannuation style accounts ( As told by the Labour Ministry before elections)but it is not so. You can save this amount from the income that is already taxed.

IF THAT WAS ALLOWED BEFORE TAX THEN I REKON MANY PEOPLE WOULD HAVE JUMPED AT THAT OFFER.
So what is the fun.And you cannot use it before 4 years. Then how is that going to ease the pain of all the people who are suffering from high rent.It will be another 4 years before a first home saver can purchase a house.

Also by that time the prices of the houses can differ.

Rachel - Why 4 years?

| | 2008-10-21 19:05:17

I don't understand why there is the need for saving for 4 years. I am prepared to rent for 2 more years to save my deposit, but I certainly don't want to wait 4 years - what is the advantage of this requirement? It seems to me that it will deter people like me as absolutely no advantage for me.

Melissa

| | 2008-10-28 21:39:38

I totally agree!

Charles Chung - First Home Savers Account is r

| | 2008-10-25 03:06:22

I saw so many posts complaining about the 4 years requirement.

I somehow understand that for most people, if they can afford buying a house in 1-2 years, why ask me to wait 4.

But you are making an assumption that the property price that you are going to buy is rising or at least stable so you think renting is wasting your money. In fact, this assumption can be wrong, now US and UK property market is dropping and it may happen to AU market (I personally think very likely) as well.

Imagine if your house costs your 500k, 50k drop already covers the rent already, plus you do not need to pay mortgage interest, water and council rate, and you can invest with your savings.

I think most people joined this account will stay away from buying a property in at least 4 years, thus limiting the demand, so why not just having more patience to wait some more years if it is of our advantages?

karen - rudd gone

| | 2008-10-26 06:00:14

as an 18 year old,i would not buy for maybe 10 years.would i still get contrbutions if rudd was out in 4 years

JOE - HELP

| | 2008-10-26 06:20:42

PEOPLE SHOULD NOT THING A DEPOIST FOR THE LARGEST PURCHASE OF MOST PEOPLES LIFES CAN BE SAVED IN 1 TO 2 YEARS .TO BE SAVE PEOPLE SHOULD SAVE AS MUCH AS THEY CAN BEFORE JUMPING IN 20% . Think of the future are you going to loss a wage when your wife has childern. people want ever thing today .

claire - miss

| | 2008-10-26 22:25:29

the idea behind this is great but what about the people who dont want to tie up money for four years. why not remove the time constraints to saw a year.

Melissa Burton - Time Period

| | 2008-10-28 21:38:48

I think you should be able to withdraw your money earlier than 4 years if its to purchase a house. The 4 year period that you have to wait is stupid.

Caitlin Dobson - hmmmm

| | 2008-11-02 17:29:38

I think that this is an awsome idea.
as a 19 year old, i will not be looking to buy a house for about another 5 years.
i think that there are many spoilt people on here who have been given everything so they just expect to be given this - Their way.
but sorry guys it don't work like that.
This is the best thing the Government has done for young people in a very very long time..
I knew Kevin 07 would pull through

Matt - Caitilin Dobson - 19 no idea

| | 2008-11-02 21:33:53

Jeremy Power

| | 2008-11-04 02:14:13

4 years is way too long! Considering the increasing flexibility of managed funds and online accounts this plan is pretty poor in comparison. Lower the minimum time period to 24 months and heaps of people will jump on board, Including me!

ruz - hit or miss

| | 2008-11-06 22:12:45

I like it, dont love it, but i am grateful.

17cents to the dollar up to the first $5000 saved is not an interest rate, it is more a yearly bonus payment.

ANZ bank are offereing 0.01%pa paid monthly, plus an additional 6.49%pa paid monthly should you deposit $10 or more that month.

If you were to save 5000 in the first year of opening an account , you would on that 5000 receive $850 from government at 17cent per dollar, as well as 6.5% interest which totals roughly $325 (not considering compound) totalling $1175 which is equivalent to 23.5% interest for the first year. Thats insaaaaaane!!

The second year you'd start with $6175, and if you saved another 5000, you would receive again 17cents to the dollar on 5000 which is $850. You would also receive 6.5% on the total $11175 from ANZ totaling $726 (not considering compound) totalling $1576 equivalent to 14.1%pa.

This patterns continues and very roughly speaking ends up at some over 8%pa by the 8th year.

So this still lo...

Jules

| | 2009-03-07 08:22:01

The percentage of government contribution decreases as the year goes as your money grow but government contribution stays at a maximum fixed amount. Using your scenario, you would have $3473 in earnings on your $20K contribution, so your money actually grow at 4.3% in average annually.

The higher percentage bracket for high income earner also means even if they deposit the same amount of money as lower income earner, their percentage is bigger because of the higher goverment contribution (I'm not taking into account the fact that they are taxed higher on their income, from what I can see each of the income bracket are being compensated with 15% 'tax break').

I could be wrong on these though, I was just playing around with the calculator and putting in different scenarios into it. This scenario is also based on a single person, not couples.

The highest annual growth percentage I can see so far is around 0.3-0.5 higher than average bank interest, and maximum interest earning you can...

ruz - hit or miss cont.

| | 2008-11-06 22:15:10

So i could potentially have 40000 dollars in this account, not have access to the funds unless for the specified purposes, and i would receive NO interest. This would prevent me from quite alot of money especially if this continued.

Secondly, with few major banks actually making this First Saver Account available, whats going to keep interest rates competetive?

All in all though, i believe this is a great scheme and i have applied for an account and will make good use of it.

Bob E

| | 2008-12-08 03:47:01

Does the Govt pay the interest of 17% on a compound basis year after year until the amount reaches max of $75000 and if the bank pays 5% this means you receive 22%. If you put in $5000 each 1st July you would have $75000 within 6/7 years for your contribution of less than $35000. Plus you have the benefit of the tax breaks. The calculater they provide does not agree with above WHY?

g	\| \| 2008-12-12 02:21:07

The govt does not pay 17% compound interest. They pay 17% of the amount of your deposit.
Eg. in year 3 your balance is $6100, then you put in $5000 making a total balance of $11100, they give you 17% of the $5000, not 17% of your account balance.

Kayleigh - 4 year minimum of holding the

| | 2009-01-01 00:47:45

The price of houses is likely to increase in four years time which is not likely to be covered by the contributions provided by the gov... which is approx $3,400 ($850 given for $5,000 a year for 4 years) - nice but nothing compared to spending $350,000 plus on a house (or $400,000 in 4 years time).

Many of us may want to buy sooner than 4 years and this insentive may only be beneficial to those people who will definately not be able to buy in the next 4 years.

These are the people who the government aims to help and knowing how many homeless people there are and how many people and families are struggling so hard to live - they are the people who need the help.

I guess the rest of us need to suck it up and be thankful for what we have and recognise that if we do not find this scheme beneficial there are others who will (obviously already recognised by the Rudd Government).

As I look around at possessions I want to fill my new home with I think LCD TV $1000, Playstation and...

les Saunders - Can the money in the account b

| | 2010-07-16 14:00:03

The information I've read says that the money in the account can earn interest or be invested in managed funds. Does anyone know who offers the accounts invested in managed funds?

Charlie - 4 years

| | 2009-03-14 20:04:07

I agree with the previous comments that the four year time frame is not workable. It too great a risk to tie down my money for 4 years when I may want to buy sooner.

Kaye	\| \| 2009-03-17 19:42:46

The four year limit is too long - particularly if the amount in the account has to then be allocated to Super. A couple saving hard could easily save a deposit in less than 4 years and with the current housing market would be mad to wait that long (when house prices are sure to be rising again). I thought it was a great idea but won't be recommending it to me daughter.

Dave - Mr

| | 2009-04-18 10:11:33

This scheme does not do very much to help first home buyers. The four year limit is far too long. If in 2 years time you are in a position to buy you should be able to access the funds. Forcing people to wait 4 years only means that they may miss opportunities to buy a home when circumstances are good (ie low interest rates). They are stuck and locked in for 4 years under this scheme which is not fair.

Also the calculations shown on your page are not current and are misleading. They assume a 6% per annum interest rate payment from the bank on the accounts. At the moment Commbank is offering only 3.5% for First Home buyer accounts. I doubt anybody out there is offering 6%pa. There is a big difference between the interest earned at 3.5% pa and at 6%pa (which you show). That's very false and very misleading advertising to people who are just trying to save up for a home. I should call ASIC. First Home Buyers being badly treated. :(

Admin

| | 2009-04-20 00:20:04

The calculator on this website is designed as a simple demonstration of the unique features of First Home Saver accounts, being tax concessions on earnings and bonus government contributions. By assuming the same earnings rate in both the regular savings account and the First Home Saver account, the relative affect of these features can be isolated.

The assumed earnings rate is similar to that used by ASIC in its own First Home Saver Account calculator, where a 5.5% p.a. return on deposit accounts is assumed.

As noted on the calculator page, “The outcomes provided by the calculator do not represent any particular product, and should not be relied upon in making any individual investment decisions.”

Chomps

| | 2009-06-16 18:40:00

I think it's irresponsible to encourage first home buyers to risk sending their savings to super if they don't buy a house after all. A saver's personal circumstances can change so much over 4 years - they could lose their job, or take a job overseas, or move in with someone who owns their house, or have children so their house buying potential is reduced etc. For some of those reasons, the most responsible thing the govt can do is allow the saver to have their money back, when they need it. So, why not just pay savers a bonus IF they use the money for a house deposit at the end of a saving period (say, between 2 and 8 years after they start the account), where the bonus increases with the amount saved? Under that system, if the saver opts to use the money for something else they can have their money back as cash but they miss out on the bonus. The net result is that people will have an extra motivation to save and the scheme offers a leg-up for house buyers who have to come up with th...

michael - 4 year rule

| | 2009-06-17 13:01:33

it seems we all agree the 4 year rule is bad. personally i wouldnt mind it, if you could use that money to put into your homeloan once its matured, if youve happened to buy a place within that four years. The fact that you cant even though you have been saving for a first home is a major flaw in the bill. if they changed this 4 year rule we would all be keen to open an account.

I happen to live in Wayne Swan's electorate so i wrote him a long email about this issue the other night. There are many, many people on this site with the same opinion, if we each contact our local parliamentry representatives and tell them our concerns we might possibly be able to affect some change. this is a democracy after all.

ajay	\| \| 2009-07-18 11:59:35

yes , it's good but i don't think i can save that much but i can try...

drdp	\| \| 2009-09-27 13:18:51

I agree with what most ppl have said here, and that is: the time!! It's ridiculous. Such a near-sighted step by the govt. People don't think "hmm, I think in four years I'll buy a place in this / that area", how absurd. the govt. needed to realise that by putting a time cap on this scheme they have kept ppl from committing to it (eg: me - 28 yrs old, trying to save wisely, but how can I possibly commit to waiting for four years?! What if the market is terrible for buyers then? What if I lose my job / move interstate, internationally in 2 years time? They're not going to, but they SHOULD get rid of the time restriction (the truth is it was thought up by middle-aged / older govt. ppl who own their own property and have no idea / recollection of how hard it is to begin from scratch).

PeterR - The Calculator Does Not Refle

| | 2009-11-10 09:57:12

There have been comments about the rate used the calculator being too high. This is only a minor issue. If you look closely at the calculator details, you will note that one of the fundamental assumptions is that the interest rate is the same for both the First Home Saver Account and the alternative. In reality, there is a significant difference between the rates on offer from financial institutions for Home Saver Accounts compared to Cash Management and Term Deposits. This makes a much greater difference than the absolute interest rate assumed.

AdamH - 4 years is stupid

| | 2009-11-21 08:06:36

I've already saved started saving and want to buy before the stupid 4 year limit, but the tax on my normal savings ridiculous, coupled with HELP repayments. People like me are stuffed in this country!

Why does it have to be 4 years! Why is there a time limit at all? Good idea, bad implementation as usual from any Australian government

Walker - How long it takes to received

| | 2009-11-28 10:29:28

Have anyone received the 17% goverment contribution yet?

I deposited $5K into the FHSA with Commonwealth Bank on 30th June 2009 and received 2008/09 tax refund on 11th Nov 2009. As of today I am yet to receive the $850 goverment contribution.

I was told by the customer service representative in Commbank that The ATO should take 2-3 weeks to transfer the money into my FHSA and I just need to wait for it to come through patiently.

If the money remains absent by next week,I doubt the effectiveness of this scheme created to help first-home buyers to save more money for their first home, given that some account holders might not received the money and lose out on the associated compound interest.

Kerri - Kerri

| | 2010-07-16 13:58:25

with regard to the govt contribution, I have contacted ATO. Apparently, the banks have until 31/10 to provide the information to the ATO as to the amount of deposits made for the 6/09 financial year. The ATO had 60 days (to 31/12) to process the payments, which were then sent to the banks, who have 30 days to deposit to each account. So, you will probably not see the govt contribution in your account until end Jan!! ATO advised that they do send letter confirming contribution amount.

Ben Mueller - The 4 year waiting period is a

| | 2010-01-01 06:58:13

The only thing from stopping me from taking it up is the restirction of the four years.

It seems rediculous that I have to save for a full four years before I get access to my money. To me the fair thing would be to either:

1. Allow a person to use their Savings Account as part of security /equity of their purchase; OR
2. Allow the person to at least withdraw the principal sum they have put in.

The reason for the restrictions is probably due to budgetary restraints or to minimise the cost of the scheme. If people withdraw early they would loose the benefits of the additional contributions and interest and this go back to goverment, Therefore loosing nothing.

The end result in the return of the principal sum is that the person gets what money they put in, and the government receives its money back. Seems fair to both parties in this situation wouldn't you think?

Zheng - Tax deductable?

| | 2010-01-11 14:10:29

I am wondering if the money that contributed to FHSA can be deducted from gross income when doing tax return.

Which section should I use to claim this deduction in the E-tax reture software if it is deductable?

Anybody can help with this question?

Peter R

| | 2010-01-27 15:30:28

First home saver accounts don't work the same as superannuation for contributions. So no tax deduction is available when you put money in, but you do get good tax benefits by having savings in a FHSA vs a regular account. And $ is tax free when you take it out...

James SRS

| | 2010-02-09 14:06:00

Which one can you recommend as the best provider (Bank, Credit Union, Superannuation, Building Society, ect..) for FHSA? And why? Thank you.

Samuel - best interest

| | 2010-05-31 13:11:52

hey James, just go for the one with the best interset.
Its quite easy to switch even once you've started saving.

Dylan - 4years a joke

| | 2010-07-16 13:57:23

Four years a joke why would it be in the governments or the first home buyers interest to put a restriction on of 5 years. We need help to save for a deposit and this is no help.

Please explain!

Anne	\| \| 2010-04-22 12:47:08

I am really disappointed because I have been saving for a deposit for 5-6 years and only just found out about this. However I am aiming to buy a house in the next year - 2 years. So I miss out because of timing even though I saved really hard and other people get it through my tax money. Not fair.

Manuel - Only need to save for 2 years!

| | 2010-05-28 17:20:35

You open the account and deposit:
1000 dollars on june 30th of year1;
1000 dollars or more before 30th june of year 2;
1000 dollars or more before 30th june of year 3;
1000 dollars or more on 1st july of year 3.
You had the account for 2 years and 2 days and you can access the $$$$$$$!!!!!

Jdawg - RE: Only need to save for 2 ye

| | 2010-05-29 00:50:09

in response to Manuel's comment:
if you did do that, would the government still contribute 17% in the final year? (and if so when would that contribution come through?)

Manuel - Don't know about the final ye

| | 2010-06-18 15:16:35

I haven't deposited the money for the final year, so I don't know if you get the 17%. What I do know is that I got 17% from the Government for having the initial $1000 in the bank for 1 day (30th June of first year).

Anonymous

| | 2010-08-17 00:16:37

bugger! missed out by 1mth

Samuel - exactly

| | 2010-05-31 13:09:02

Hey Manuel agree!
Thats exactly what me and my partner have both done.

brett

| | 2010-07-17 11:22:04

Please be aware that this scheme is not simply to help first home buyers financially, but to teach people the benefit of compound interest, and more importantly to prepare people for a long and sometimes difficult juggle of mortgage life.

brett

| | 2010-07-17 11:25:17

4 years of preparation for a 25 year mortgage = lesson learnt (hopefully)

neil - mr

| | 2010-07-23 11:40:48

if i have owned a home before but my partner has not can we qualifiy for first home buyers grant

John	\| \| 2010-07-24 13:07:53

hey,

is it possible to purchase a first home without using your first home saver account yet, and wait until after you have saved up the maximum amount and put all the money into the house afterwards?

Anonymous

| | 2010-08-17 00:14:09

no read the fine print

Schuy - Gillard Government, lets recon

| | 2010-07-24 15:58:15

The latest data shows that out of the projected 750000 people who were to take this savings system up, only 15400 have done so. At this rate, the funds allocated to finance the scheme (1.2Bn) will last 48 years! For an 18 year old on very low wages, 4 years is a reasonable time frame to save for a first home. Most wage earners who are seeking to use this system have a slightly higher income and are able to save within 2 years for a deposit. Most people do not want to wait 4 years to use their OWN money as a deposit. Taking this into consideration, the government should place an end date on this scheme, and look at placing the money back into the FHOG, which is a proven assistance scheme.

marina

| | 2010-07-28 16:27:08

I think this is an excellent program and would love to see it extended to people under 18. My 16 year old twin daughters have just started working and would like to put their salaries into this scheme so that they can save for a home. At the moment they put it into a normal savings account which is readily accessible and hence the temptation is there for them to keep withdrawing to buy the most ridiculous things.

Phil	\| \| 2010-09-07 06:37:29

It is quite effective to discourage people from even thinking of buying a home. Shame on you Gillard govt.

Matt	\| \| 2010-09-07 11:24:06

I posted in april 2008 and just got an email from this site so I checked back... I didnt have a full house deposit at that time so I looked into this scam (sorry scheme). I didnt and still dont like the 4yr term as you never know what the future holds.

I ended up buying land (less deposit needed) holding it for a while and then building (allows you to pay small parts as you go) This worked really well for me, and made me money!

At the time I started looking I wasnt earning great pay but being young in a new career I have had many pay rises and the now house isnt too much of a financial burden.

Good luck to others still looking - this wasnt at all for me. My advice is just do something - normal savings or this if you want to lock into 4yrs

paul	\| \| 2010-09-08 15:19:59

If the changes go through I am definitely interested

Confi Dential - Lack of liqudity versus minisc

| | 2010-09-10 18:14:14

Lack of liqudity versus miniscule difference between normal savings account results, and the FHS program, makes this a bad bet! No wonder the uptake has been incredibly low. What happens if someone wants to buy a place after one year? two years? three years? No, you must wait four. Get real you meddlers! And get flexible.

gc - Accounts for under 18's

| | 2010-09-13 14:49:54

As a parent or guardian can open a super account for a child under 18, I believe that a parent or guradian should be able to open a HSA for a child. A child over 16 if working (and receiving Super G'tee), can open a Super Account and make their own decisions, so they should be able to do the same at least with a HSA.

Leanne - Fair break

| | 2010-10-14 07:17:16

Great opportunity that my children can take up but as a single mum who lost her house in a divorce settlement I'd love this opportunity as well in many ways I'm a first home buyer it's the first home I'd be buying on my own!!! I've never bhad the incentives of gem y! No baby allowances, no first home buyer grant, time we got a break or you'll be paying us full pensions when we retire.

Stock Market Investing - Nothing Fantastic

| | 2010-11-20 10:37:08

I think that the scheme is OK for a young couple who are just starting off with saving for a home, but and this is a big but, it's nothing fantastic if your a hard core saver and investor. The Government is trying to kill a number of birds with one stone here, it's only motivation is just not for first home savers/buyers. I would like to see even less 'fine print' in the scheme, don't get me wrong the scheme is somewhat better than what it was, but to say its a fantastic opportunity is getting just a little excited.

Aaron - 4 year to use the money is too

| | 2010-12-11 22:48:42

It is not flexible for me, a single full time employee with few hundred dollars income each week. I would like to take the chance of falling property price in Brisbane in recent 2 years.

anon - agreed

| | 2011-09-13 12:26:22

yeah, im in the same boat and apparently low earning singles will never get into the property market.

anon	\| \| 2011-01-02 16:40:02

would be keen to use this scheme - if only the money could be rolled into mortgage after 4 years if a home was purchased too early, rather than into super.
hope the proposed changes are made, i would open an account immediately to use alongside my online savings accounts.

Else - Miss

| | 2011-01-11 08:31:34

Hey - I want to start a home saver account--- BUT, what happen's if in the future I get married to a guy who owns a home... am I aloud to withdraw the money from my first home saver account and deposit it on the morgage of my husbands home????
Without this as an option, as a girl it seems somewhat risky starting an account :-(

Jenna

| | 2011-02-22 09:29:17

I hope your comment isn't serious. What if you're guy and marry a woman who already has a house? Why the sexism?. Dont plan your life around relying on finding someone with a house. Look after youself, dont expect others to do so..

cassie - FHA's need a reduction in lim

| | 2011-02-08 18:33:52

The problem with the FHSA as highlighted by many others, is the 4 year length. Even if the the money goes to your mortgage rather than super (which is just ridiculous and the reason only 20000 odd people have taken up the scheme)the waiting period is just too long. You still have to wait 4 years to put the money toward your mortgage if you buy a house before the 4 year period is reached. The answer as I see it is to reduce the house savings minimum to a 2 year period. Even if it is initially introduced until people become more aware of the existence of FHSA's. At the moment, most poeple already have savings and to wait for 4 years (on top of the the period of having saved funds already) is not a wise investment decision, because by the time one enters the property market capital growth on property over the required 4 year period of saving has far outweighed any interest that may have been gained in the FHSA. Having already acquired savings and later discovering the existence of FHSA...

Liz Turner

| | 2011-02-09 18:39:05

FHSA is a great idea, but why cant you open one from the age of 15 or 16 when you can get a tax file number. My son will be working full time from the age of 16 (Apprenticeship) and I was going to put the board money that he is paying us into a FHSA for him so he would have a good deposit ready for him when he is ready to buy a home. The change to the minimum 4yrs rule is definately needed, but why is there a 4 yr rule in place at all. Housing markets move up and down and if you have to wait 4yrs to get your savings you may end up buying a house in the high market when you could have possibly purchase in a lower market.

Arnaldo - FHSA comment

| | 2011-03-06 11:12:48

It is not good to put too much money to buy a property as if in case you need the money or change your mind not buying a property, you won't be able to access your money.

With house prices going up, more savings is erquired and if one morning we wake up and the property prices is not afordable and your FHSA savings was not abel to keep up with the house affordability then people will not be encourage to put more money on the account.

I myself would probably be comfortable putting only a small amount of money as I do not know in the future if I cna still buy a property here in Australia therefore I cannot just put all my saving on the account.

If they can make it flexible like we cna withdraw money from it like 2x a year maybe then I would be encounrage tio put all my money on the FHSA rather than puttign it on the normal bank account.

Effy Lee - Mmm 17% vs 15% tax p.a

| | 2011-05-06 21:04:21

Well can anyone clarify ...you get 17% on whole yearly amount up $5500 but get 15% tax on the whole interest p.a ??
So 2% profit? or a loss if you saved 10-20k in a year compared to a regular fixed term account and rolled over new amount each term of the deposit??

And yes the 4 year rule does suck but the roll over features to super are a good protection idea ...

Nathan

| | 2011-10-26 13:47:17

17% of your deposit and15% of the interest
It is not 2% profit

If you deposit 4000 in a year government contribution would be 680

And you will earn some interest 4-6 %.

Tax would be 15% of that interest not the deposit.

Rob Nicholson - Bill awaits royal assent

| | 2011-05-17 17:07:46

OK so now we can almost buy a property inside the 4 year restriction without it going into super. How long does royal assent normally take? I would really like to buy my property now and the money in my FHSA go into my mortage once my 4 years has elapsed. I wish there was some sort of offical site for these sorts of things.

Rachel White - Four Years Minimum

| | 2011-05-19 21:54:02

Why is it a four year minimum? I would like to put a deposit on a house in less than four years but I don't want to pay mortage insurance so I'll need the money in the account to pay a large deposit.

It's a great opportunity but it just feels too restrictive.

Francis Rivero - Mr

| | 2011-08-06 09:13:40

The 4 year rule makes no sense.. You should be able to buy a property when ever... I hope to have 3 property's over the next 4 years not just buying my first one

Simon - Age Restrictions

| | 2011-09-10 11:49:42

This is a great incentive, but why is there an age restriction of 18 years?

You can be employed by Maccas as 15, but can't open one of these accounts.

My son is 10 and earns money from mowing lawns and pressure washing driveways. I'd like to encourage saving for a first home, but to wait another 8 years is crazy.

Wouldn't it be better to lower the starting age so that people will actually have enough money for a house deposit before they are 50?

Rebekah Hudson - 4 Years is Too Restrictive

| | 2011-11-03 15:06:10

We too are hoping to buy a home is less than 4 years (roughly 2 years), and it seems crazy that while I can now access the money before super, if I buy in less than 2 years, I still can't put it straight into my mortgage. Obviously it is in the government's and bank's interests to keep the money and earn interest off it themselves, but it's certainly not in our interests to tie up too much that may go towards a deposit in this account, when I can't even pay it off my mortgage for another 2 years after purchasing the house. How frustrating!

chrissy - investment house

| | 2011-11-30 10:11:06

i have first home saver account and wish to keep that for my first home. however, i am also looking around to get my first investment house and worry that i will get penalised by FHSA once i got my investment house. So the question is can I still keep my FHSA active for my first home and get an investment house (without touching my FHSA)?

Heather - Which banks?

| | 2011-12-08 15:06:02

HI- The commbank no longer run this scheme- has anyone opened an account recently at a bank?

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