The Pros and Cons of the FHSSS

The idea of saving for your first home deposit can be a daunting task these days. Houses are so expensive, that many people are opting out of owning and sticking to renting. According to the 2016 census, there are almost as many Australians renting now as there are who own their properties – and that divide is only growing wider.

So, what exactly is the FHSSS and how could it help you obtain the Aussie dream of owning your own home?

In order to address the affordability issue, the federal government introduced the ‘First Home Super Saver Scheme’ in July 2017. Basically, the scheme allows you to make super contributions that are later accessible to put toward your first home deposit. The low tax nature of a super account is what makes this scheme attractive.

Sounds simple, right?

While the FHSSS is perfectly suited to some, there is a lot of fine print that may detract from its immediate appeal. If you are saving for your first home it’s definitely worth mentioning to your financial advisor, but in the meantime here’s our list of major pros and cons of the FHSSS:


  • You may save up to $30,000 under the scheme, or $60,000 if purchasing with another person, with added interest from the ATO.
  • You may make concessional (before tax) contributions under a salary sacrifice agreement with your employer. These will still be taxed, however the tax rate is generally lower than the rate normally paid on taxable income.
  • You may access your money saved under the FHSSS, even if you intend to purchase a property with someone who is not a first home owner.
  • Withdrawals made under the FHSSS will not be used in any ATO income tests. Meaning, it will not affect any debt or social security payments.


  • Super contributions must be voluntary, meaning you cannot withdraw any super paid by your employer under the scheme.
  • You may not contribute more than $15,000 per year under the scheme.
  • You must not have previously owned a home, and intend to live in your property immediately after purchase.
  • Tax is still payable upon withdrawal, though with a 30% tax offset.
  • If you change your mind about purchasing your home, you will not be able to withdraw any savings under the FHSSS. Rather, they will stay in your super account until retirement.