Trudeau Proposes First Time Home Buyer Savings Accounts With Tax Benefits

[Economy 52,844]

https://www.google.ca/amp/s/www.bnnbloomberg.ca/first-home-savings-account-has-rrsp-and-tfsa-tax-perks-but-questionable-prospects-1.1644839.amp.html

 

Justin Trudeau proposes that if re-elected he would implement a FHSA (First Home Savings Account) which is for individuals who do not own a home yet to save towards a downpayment for one

 

The account with be a best of both worlds of an RRSP and a TFSA

 

Like an RRSP, money contributed would have tax deduction benefits... but like a TFSA, money withdrawn would not be subject to taxes

 

The account can only be held until age 40. If an i dividual turns 40 and still has not been able to use the money for a home downpayment, the account would automatically be converted to a regular RRSP and all the applicable taxes and fees upon withdrawl

[Big Reputation 800]

I hate Trudeau with a passion. That sounds nice but there’s so much more with him I despise. Hopefully voting him out next month 

[Dojo 19,823]

Just now, Economy said:

The account can only be held until age 40. If an i dividual turns 40 and still has not been able to use the money for a home downpayment, the account would automatically be converted to a regular RRSP and all the applicable taxes and fees upon withdrawl

this seems a little ageist.

[Economy 52,844]

The idea isnt bad per say... just like the proposals for forein buyers taxes arent bad per say either...

 

But none of these things go to the root of the problem so they will only help marginally... our construction which has lots of red tape and slow approval processes is making it impossible for supply to keep up with population growth and hence Canada has some of the lowest housing units to population in developed world

 

We need more supply. Thats what will actually help more.

 

Forein buyers taxes, or savings accounts are just sprinkles on the cake. They dont solve the root problem and for many individuals this idea in particular is useless a higher downpayment still wont make a dent on homes selling for over $1M

 

Thoughts? @LaLa @OBEY @GagaSine @JustinTrudeau

[Economy 52,844]

4 minutes ago, Reputation King said:

I hate Trudeau with a passion. That sounds nice but there’s so much more with him I despise. Hopefully voting him out next month 

Thats the thing. It sounds nice, it wont do much to solve the problem as a whole

 

This will only benefit specific individuals that can "almost afford one now" and this little extra help maybe gets them in

 

But the higher bidding power of those individuals will also just make the overall market even hotter also partially offsetting some of the benefits of this to many

[Economy 52,844]

12 minutes ago, dojo said:

this seems a little ageist.

What are u talking about??? All these types of accounts RRSPs, TFSAs, Youth Accounts etc have always had age regulations for different stages of life...

 

This one is just another to add to the list... its no different?

 

Tho i would agree the age limit for this is set a little too low

 

Edit: @dojo actually 40 makes sense now that I think about it as most new mortgage amortizations in Canada last 25 years and at age 40 u have 25 years left to retirement

 

If u buy a home past age 40 u likely will still have a mortgage at age 65 so maybe they dont want to encourage that hence setting limit at age 40

 

As real estate becomes more and more insane in Canada and ppl get thenselves into trouble with very high mortgage debt, more and more advisors are starting to suggest if u have to stretch urself very thin to get a house, or take a mortgage into retirement it may make more sense to just rent and save up for ur future with other investments... a conversion of account to RRSP at age 40 would lock in your cash as retiremenr investment instead which in many cases makes sense after midlift to go that direction, but even when it doesnt, the money isnt gone, u just cant use it tax free in that moment anymore

[Big Reputation 800]

25 minutes ago, Economy said:

Thats the thing. It sounds nice, it wont do much to solve the problem as a whole

 

This will only benefit specific individuals that can "almost afford one now" and this little extra help maybe gets them in

 

But the higher bidding power of those individuals will also just make the overall market even hotter also partially offsetting some of the benefits of this to many

Exactly! Trudeau honestly needs to go and thankfully it seems like we’re gonna do that in this election 

[Economy 52,844]

1 minute ago, Reputation King said:

Exactly! Trudeau honestly needs to go and thankfully it seems like we’re gonna do that in this election 

Im gonna be honest tho... im not loving the other parties either rn especially conservatives...

 

I dont love Trudeau but i still think of the 3 main parties hed do the least damage

[Big Reputation 800]

11 minutes ago, Economy said:

Im gonna be honest tho... im not loving the other parties either rn especially conservatives...

 

I dont love Trudeau but i still think of the 3 main parties hed do the least damage

Oh really? I’m voting for O’toole. I think he’ll be much better than Trudeau. And his own policies are much more progressive than previous candidates from that party 

[Economy 52,844]

41 minutes ago, Reputation King said:

Oh really? I’m voting for O’toole. I think he’ll be much better than Trudeau. And his own policies are much more progressive than previous candidates from that party 

Sometimes i dont mind the Canadian Conservatives... on social issues they arent usually as problematic as US right wing conservatives and sometimes i like their pro business growth policies

 

But it depends in circumstances at the time and the platform and this time around i find their platform weak and wasteful

 

For example their idea of a GST holiday in December i think is totally dumb and a waste. Theres ways to get better bang for the buck on economic stimulus than to sacrafice tax revenue to prop up a sector (which on christmas is mainly retail) which is a sector that bleeds a lot of money from the nation cuz most retail items are imported. It wont ripple thru our economy for manufacturing or other sectors and instead mainly fuel forein manufacturers

 

I was also upset they wanna cancel $10 a day childcare plan in favour of a lump sum tax credit... child care is one of the few things Trudeau started i actually love. It has a great benefit to cost ratio for economy because not only does it help families financially directly (which they can spend elsewhere) but also encourage more parents especially women to return to work. Parents who stay years as stay at hone parents cuz they dont earn enough to make childcare worth it is a huge loss to productivity thru lost labor force participation

 

Having to wait all year for a lump sum tax credit (which doesnt even cover full cost of childcare in most cases) may not be inviting enough to get low earning stay at home parents to return to workforce

 

So i found their proposal weak and disapointing

 

The NDP i dislike simply because despite good intentions, they are too agressive against business and the business they will drive away will end up doing more harm than good i think. Some of their ideas in principal like raising capital gains tax so the very wealthy pay their fair share i think is a good idea but overall across the board i think some stuff goes too far

 

So i dont love Trudeau... but im kinda disliking the other 2 alternatives even more tbh

[LaLa 19,898]

oy, this seems like it's not going to change anything, honestly. Like, no harm in creating this, fine. But it won't do a ton for most people I think.

I still don't know what I'm going to do, voting wise. The Green party has an actually viable candidate in my riding, so I might go that way. My ultimate preference is NDP, but that seems like wasting a vote at this point. If I don't go Green it'll be Liberals again, just to try and make sure O'Toole doesn't get a majority. I'm pissed that an election was even called right now, but it is what it is I guess 

[Economy 52,844]

4 minutes ago, LaLa said:

oy, this seems like it's not going to change anything, honestly. Like, no harm in creating this, fine. But it won't do a ton for most people I think.

I still don't know what I'm going to do, voting wise. The Green party has an actually viable candidate in my riding, so I might go that way. My ultimate preference is NDP, but that seems like wasting a vote at this point. If I don't go Green it'll be Liberals again, just to try and make sure O'Toole doesn't get a majority. I'm pissed that an election was even called right now, but it is what it is I guess 

It really wont do much lol. I dont think it will cause harm but in the grandscheme of things the extra few thousand it helps u save from tax credits is gonna be a drop in the bucket to what homes cost

 

Also wasting a vote? Dont the NDP usually gain more seats than the Green party?

 

Personally i like some of the NDP proposals but not all... 

 

I think id stick with Trudeau... but that kinda says a lot of what i think of our options cuz i dont exactly love Trudeau Either

 

Also Trudeau needs to get a grip on finances too as we reopen. I get we were in an emergency fine. But even before pandemic he was already displaying a pattern of breaking original deficit pledges to overspend more than he originally planned and he did that twice before pandemic so u kind of see a pattern there. I dont want a repeat of the early 1990s in this Country

[PartySick 172,478]

1 hour ago, Economy said:

Thats the thing. It sounds nice, it wont do much to solve the problem as a whole

 

This will only benefit specific individuals that can "almost afford one now" and this little extra help maybe gets them in

 

But the higher bidding power of those individuals will also just make the overall market even hotter also partially offsetting some of the benefits of this to many

Aren't houses in Canada like stupidly expensive?

[Guest]

Not like I’ll ever own a house here.

[Guest]

23 minutes ago, PartySick said:

Aren't houses in Canada like stupidly expensive?

Sure are. And not much affordable housing for low income people, like me - AT ALL. I’ve been on an affordable housing wait list for almost the MINIMUM 7 YEARS. It’s now a minimum of 10 years, if people were to apply today.