FREE MONEY in the form of First Home Saver Accounts…
I absolutely love FREE MONEY and think that we should all try to get a piece of it, whenever we can. First Home Saver Accounts were introduced relatively recently, and probably won’t be around forever, but basically they’re there to help young people save for, and buy their first home.
What is First Home Saver Account?
Most banks offer a First Home Saver Account, allowing you to deposit up to $6,000 a year, of which the government will then contribute 17% extra straight into the account. That’s $1,020 of free money. You’ll also earn interest as per usual, at the rate offered by the bank you choose.
Pretty amazing right? And you can do this for up to 4 years. This means that over that period, the government will give you, for FREE, over $4,000 toward your first home purchase.
The only catch is, you have to use the money toward a property. You can’t change your mind and take it out to go on a holiday, so it’s really only for those of us who are 100% keen on owning a property.
If you did decide not to purchase a property, it’s not like you lose the money or anything, but it can only be deposited into your superannuation. This is certainly not a bad thing, but admittedly most young people won’t be keen on seeing there hard earned savings get locked away until they turn 65!
The chances are you’re going to need more than this for your home deposit, so using another high-interest online savings account to accumulate the rest of your savings is a good idea.
Although you can put more than $6,000 a year into your First Home Saver Account, the government will only provide the 17% contribution on the first $6K, so there’s no use in risking locking away anymore than you need to.
Just arrange an automatic transfer of up to $500 per month into your First Home Saver and then put the rest of your savings into your other online account.
Grab the opportunity
As I mentioned earlier, I don’t believe these First Home Saver accounts will be around forever, so it’s definitely something worth checking out, if you’re interested and committed to saving for a home.
Be sure to do your own research before selecting which bank to use, check out any fees that may be applicable and get some advice from a professional if you’re not sure.