Australian Government is trying to make it simpler to buy your first home.
With their launch of the First Home Saver Account in October 2008 many financial institute including major banks and credit unions introduced it helping people save for their first home.

What is First Home Saver Account?

If you meet the eligibility and savings criteria, the Government will not only tax your savings at a lower rate, but they will contribute to them.

You need to be a first home buyer aged between 18 and 65. There is no minimum to  open a special First Home Saver Account, some institutions are paying higher interest rates than others, shop around will help you build funds.

You will be able to withdraw your savings tax-free and buy or build your first home. Make personal after tax contributions of at least $1,000 a tax year (that’s 1st July to 30th June) for four financial years. You must provide your Tax File Number to the account provider.

You can save up to $75,000
Your savings will only be taxed at 15% instead of the usual marginal tax rate
The tax will be paid trough the account provider from interest earned, not you.
The Government will contribute 17% up to $5,000 of the contributions you make each year. So if you save $5,000 in a year you will receive a Government contribution of $850. This help you build funds.

Withdrawals will be tax-free for your first home to live in. Remember, you need to save over at least four years to be eligible to withdraw your savings tax-free so don’t delay.

If your circumstances change and you decide not to buy, you can transfer your funds to your superannuation fund.

Your can still claim the First Home Buyer’s Grant if that is applicable

We advise you to visit Australian Government’s First Home Saver Account site for more information and changes.

 Talk to your Mortgage Expert Today.