FHSA vs. RRSP vs. TFSA: which to use first to buy a house
There's a newer account that beats both old standbys for a first home — and most guides still don't mention it. Here's the order to use them in.
Written by the MoneyMolecule teamUpdated June 20266 min read
Canada gives you three tax-sheltered accounts, and for years the advice was “borrow from your RRSP.” Then in 2023 the government launched the First Home Savings Account (FHSA) — and quietly made the old playbook outdated. The trouble is the internet hasn’t caught up, so the most powerful account is also the most overlooked.
The three accounts, side by side
Here’s the whole decision on one screen. Watch the FHSA column — it’s the only one with a checkmark in every row that matters for a home.
FHSA vs RRSP (Home Buyers' Plan) vs TFSA
As of the 2024–2025 rules. Limits and details change — confirm current figures.
FHSA
RRSP (HBP)
TFSA
Tax deduction on contribution
Yes
Yes
No
Tax-free growth
Yes
Yes
Yes
Tax-free for a home
Yes
Loan only
It’s yours
Must pay it back?
No
Yes, 15 yrs
No
Annual room
$8,000
income-based
~$7,000
Lifetime cap
$40,000
up to $60k via HBP
grows yearly
The order to use them in
If you’re saving for a first place, stack them in this priority:
1
FHSADeduction in, tax-free out, no payback. Max it ($8k/yr) before anything else.
2
RRSP (HBP)Once the FHSA is full, the Home Buyers’ Plan adds borrowing room — just remember the 15-year repayment.
3
TFSAFlexible backup. No deduction, but withdraw anytime tax-free — useful for the parts of your down payment you may need fast.
~$200,000
of tax-advantaged room a couple can stack toward a first home by combining FHSAs and the RRSP Home Buyers' Plan
The best account for your first home launched in 2023 — and most advice still acts like it doesn’t exist.
About this guide: written and reviewed by the MoneyMolecule editorial team. Figures here are illustrative — your savings depend on your situation. Sources are linked inline. This is general information, not financial advice; for your specific case, compare official sources or consult a qualified professional.
