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First Time Homebuyer Question #1

Blog by Diane Cardoso | October 25th, 2011

How can I easily save for my downpayment?   Generally the best way to save your downpayment is with an automated savings plan.  Set a budget for an amount that you can afford from each paycheque and you will watch your downpayment build quickly.  You may also consider looking at a Tax Free Savings Account (TFSA) or direct your automated savings to a Registered Reitrement Savings Plan (RRSP).  First time home buyers can withdraw money free of charge from a TFSA and you can contribute up to $5000 per year into your TFSA.   Under the RRSP Home Buyers Plan, you can withdraw up to $25,000 from your RRSP tax free to use as a downpayment on a home, providing you pay back the plan within 15 years.  For more info on the RRSP Home Buyers Plan go to www.cra.gc.ca and search Home Buyers Plan.   It is advisable to speak with your banker, mortgage broker or financial advisor on which is the best savings option for you.  Your downpayment will be there before you know it!