- New tax-advantaged registered savings plan for first-time
home buyers that combines the benefits of RRSPs and TFSAs
- BMO Real Financial Progress Index reveals that among those
planning to use a home buyer assistance program, 21 per cent plan
to use a FHSA to purchase their first home
TORONTO, Nov. 6, 2023
/CNW/ - BMO today announced the launch of its First Home
Savings Account (FHSA), a new tax-advantaged registered savings
plan that empowers Canadians to invest and save towards the down
payment on their first home.
The FHSA combines the benefits of a Registered Retirement Saving
Plan (RRSP) and a Tax-Free Savings Account (TFSA). FHSA
contributions are tax deductible, earnings are tax-sheltered, and
withdrawals are tax-free when used towards qualified first-time
home purchases. First-time home buyers can contribute up to
$8,000 a year, with a lifetime
contribution limit of $40,000.
"Homeownership continues to be important to real financial
progress, security and wealth creation for many Canadians and their
families. We are excited to offer first-time home buyers more
flexible paths to home ownership, including tax-efficient
strategies that allow them to put their investments to work and
effectively grow their savings for their down payments," said
Nicole Ow, Head, Retail Investments,
BMO. "We encourage customers to work with a professional advisor to
help them understand the investment opportunities available and
create a personalized plan to help them make progress towards their
financial goals."
According to insights from the BMO Real Financial Progress
Index, among the 46 per cent of Canadians who are planning on
using home buyer assistance programs, 21 per cent plan on using the
FHSA for their home purchase. However, only 38 per cent of
Canadians are aware of the account's features and benefits.
Customers can learn more about FHSAs and set up an account in a BMO
branch, over the phone or through their investment advisor.
BMO also offers tools and resources to help customers throughout
their homebuying journey:
- BMO SmartProgress: Customers can learn more about
FHSAs in a new learning module available in BMO SmartProgress'
homeownership playlist. BMO SmartProgress is an online education
platform where Canadians can learn more about how to manage their
finances.
- Pre-Approval: For homebuyers, getting
pre-approved provides a cushion for due diligence when purchasing a
home. In addition to visiting a local branch to speak with an
advisor, BMO allows homebuyers to apply for mortgage pre-approval
online. To give extra time for house hunting, BMO offers the
longest rate guarantee period at 130 days of any major Canadian
bank (as of September 5, 2023).
- Pre-Qualification: To get started with their
homebuying journey, prospective homebuyers can get a mortgage
estimate in one minute with a 130-day rate hold. Using a soft
credit check that will not affect their credit scores, customers
will be able to know how much they can potentially afford for a
home based on information such as income, assets and debt.
For more information about BMO's FHSAs, please visit:
www.bmo.com/fhsa.
About BMO Financial Group
BMO Financial Group is the
eighth largest bank in North
America by assets, with total assets of $1.25 trillion as of July
31, 2023. Serving customers for 200 years and counting, BMO
is a diverse team of highly engaged employees providing a broad
range of personal and commercial banking, wealth management, global
markets and investment banking products and services to over 13
million customers across Canada,
the United States, and in select
markets globally. Driven by a single purpose, to Boldly Grow the
Good in business and life, BMO is committed to driving positive
change in the world, and making progress for a thriving economy,
sustainable future, and inclusive society.
SOURCE BMO Financial Group