Dear Lifehacker, Like thousands of other Aussies, I have a First Home Saver account which will be cut from next year (thanks Abbott!) I was wondering what other good alternatives might be available for people who want to keep saving for a house, but aren’t quite ready to take the plunge. Thanks, House Hunter
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For those not in the know, the First Home Saver Account was an Australian government scheme designed to assist first home buyers to save for homes by offering eligible savers 17 cents of government support for every dollar of savings during a financial year, up to a cap of $935, along with tax concessions for those eligible to open an account in the first place. There were limits on how you could withdraw the money — essentially it had to be for buying a new home, and you had to have contributed at least $4000 over 4 separate financial years.
The removal of the First Home Saver Account is part of the politically contentious 2014-2015 budget, but the reality is that providers have stopped processing new applications so it is effectively dead. In your case, because you’ve already got an open FHSA, you’ll still get the tax concessions until the 1 July 2015.
Saving for a house remains a worthwhile goal, however, so the single best bit of advice despite the First Home Saver Account biting the dust is to keep on saving as hard as you can. Our monthly Ratehacker column rounds up the best deals in everything from credit cards to savings accounts, so that would be a good first port of call.
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