# First home saver account - poor man's superfund



## son of baglimit (15 May 2009)

this info was passed onto me recently - a nice little earner for those that qualify, and in practice it becomes a poor mans superfund - for someone who will never own a home (for whatever circumstances), would like to put money away for rainy days (retirement) but cant really afford to.

to qualify for this poor mans superfund....as opposed to the FHSA.

aged between 18 & 65.
have a TFN.
never owned a home.
happy to put the money away until they reach the age where they can qualify to withdraw it again from super.

now ignore all the info - just use this calculator......

http://www.fido.gov.au/fido/fido.nsf/firsthomesaver

on the initial page, to avoid the qualifying questions, just answer yes.

on the next page the only field to change is the "how much can you save?"

enter $1 (hence the poor mans superfund)

the interactive graph on the right shows the balance growing, but at an amazing rate considering the measly $1 per financial year being contributed.

AND THAT MY FRIENDS IS THE FUN.

click on "show working" and move to the 8th column - government contribution.

the government will pay a 17% co-contribution to the account (maximum $850). 
17% of your $1 is not much, BUT the good old government (assuming for admin reasons) pays a minimum co-contribution of $20.

hence you get a $20 government contribution on your $1.

yes folks it aint much for the ASF crowd, but as a poor mans superfund, its money for nothing.


*****to avoid moving off topic, please dont post political comment on this thread (despite the need of many of you)


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## Kryzz (20 November 2010)

*Re: First home saver account - poor mans superfund*

Does anyone know if the govt pays 17% per year on _contributions only_ or the balance as well? 

Seems unlikely it would be the balance, because 22% (inc. bank interest) a year guaranteed (obviously making the presumption interest rates don't move) sounds too good (ie, the govt wouldnt give you 17% on balances of 20k for example, in latter years surely not?)

http://www.commbank.com.au/personal/accounts/firsthomesaver/


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## drsmith (20 November 2010)

*Re: First home saver account - poor mans superfund*

The guff.

http://www.homesaver.treasury.gov.au/content/fact_sheet/Account_Holders.asp


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## c-unit (20 November 2010)

I still haven't received my government contribution for the money i put in last financial year. Looks like Swanny has empty pockets after blowing $100b on wasted stimulus money so the good savers amongst us will be missing out!


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## son of baglimit (21 November 2010)

c-unit said:


> I still haven't received my government contribution for the money i put in last financial year. Looks like Swanny has empty pockets after blowing $100b on wasted stimulus money so the good savers amongst us will be missing out!




thanks for the political comment c-unit.

the contributions are paid in january at the earliest.


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## c-unit (21 November 2010)

son of baglimit said:


> thanks for the political comment c-unit.
> 
> the contributions are paid in january at the earliest.




No problem.

Thanks for the info though, I couldn't find any details as to when they pay it. Commbank didn't even know. Appreciated. Any idea why it takes so long? Not that it really matters given it's a long term scheme.


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## poverty (21 November 2010)

I'm poor and really like this account 

An instant 17% on $5500 (it goes up with indexation) and then interest on your whole balance makes for some pretty awesome compounding.  I'm going to max it out each year for my wife and I.

On top of $1000/year co-contribution for wifes super and around $300 for mine it makes for over 3K of government charity for us each year.


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## akkopower (21 November 2010)

c-unit said:


> No problem.
> 
> Thanks for the info though, I couldn't find any details as to when they pay it. Commbank didn't even know. Appreciated. Any idea why it takes so long? Not that it really matters given it's a long term scheme.





I rang the ato the other day, trying to find out when they will pay their contribution.

they said
<60 days after u lodge yr tax return they will send the contribution to your bank and then the bank has no longer than 30 days to put the funds into yr acct.


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## maffu (22 August 2011)

akkopower said:


> I rang the ato the other day, trying to find out when they will pay their contribution.
> 
> they said
> <60 days after u lodge yr tax return they will send the contribution to your bank and then the bank has no longer than 30 days to put the funds into yr acct.




Thanks for that. When I signed up the Commonwealth Bank employee had no idea how quick the government would pay the contribution, and its not in any of the paperwork. I assumed it would be pretty slow.

I lodged my tax return last night, so I will wait and see how long it takes.

In other news, the Commonwealth Bank is no longer offering these accounts because so few people took them up.
http://www.news.com.au/money/proper...ome-scheme-fails/story-e6frfmd0-1226118607888


> Belt tightens as first-home scheme fails
> 
> EXCLUSIVE by Ben Pike
> From: The Daily Telegraph
> ...






I think they are great 18% Co-Contribution is an incredible risk-free return for the patient saver, however most people I have mentioned these accounts to have not taken up the offer because they are perceived as too complicated.


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## RandR (22 August 2011)

I too also think the accounts are great, am just going through the process of setting up one for myself, and the girlfriend. Both achieving 20% plus returns on up to 11000 a year in a bank account is pretty damned hard to pass up. A couple of years of that accumulating and compounding will be moving faster then real estate prices imo over the next 5 years.

We were actually looking at CBA, but now there withdrawing it leaves us between a toss up of ANZ or ME Bank.

Anybody with accounts with either of the providers above have and positive/bad experiences with either ? Were leaning towards ANZ, but only because we've used them before and have not yet dealt with ME bank for anything


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## Julia (22 August 2011)

I've been with ANZ for my base account for all my life and have never once had a problem with them.
Great service from the local branch, call centre is staffed by people who speak Australian English and who are polite and helpful.

Downside is that interest rates can be lower than other institutions for deposits.


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## danago (23 August 2011)

> Mr Smith said: "People are largely unaware that the FHSAs exist. It has not been marketed to the public. While they have made changes to the scheme to make it easier, it has not been publicised to the same extent as the First Homeowner's Grant."




This is pretty much what i have observed. I have a FHSA with CBA, and i think it is a great product, especially since i am set on buying a house soon after i graduate from university. More often than not (much more often), whenever it has come up in conversation, people have never heard of the scheme; at first they think i am talking about the first home buyers grant until i explain otherwise.


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## maffu (22 May 2012)

maffu said:


> Thanks for that. When I signed up the Commonwealth Bank employee had no idea how quick the government would pay the contribution, and its not in any of the paperwork. I assumed it would be pretty slow.
> 
> I lodged my tax return last night, so I will wait and see how long it takes.




I thought I would bump this thread as we near the end of the financial year and I am about to make my second deposit, it gives time for those that were not aware of this product to sign up if it makes sense to them.

To answer my prior point, the Government Co-Contribution was put into my account 3 months after I submitted my tax return.

Deposit: $5000 27/06/2011
Gov: $850 15/11/2011
Accrued Interest: $250
Total: ~$6100 in 1 year so a nice 22% return for the year is excellent. A bit disappointing the interest rates had dropped down to 4.25% during the year.

I also put the cash into my partners account, so we both earned the 22% return.

Is anyone aware of the maximum deposit that can be made this year? I believe it was inflation adjusted so is above $5,500 this year? Will check at the bank if no one is sure.


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## jono1887 (23 May 2012)

maffu said:


> I thought I would bump this thread as we near the end of the financial year and I am about to make my second deposit, it gives time for those that were not aware of this product to sign up if it makes sense to them.




Seems like all the big banks aren't offering this account anymore. Which bank have you got this account at?


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## robz7777 (23 May 2012)

maffu said:


> Is anyone aware of the maximum deposit that can be made this year? I believe it was inflation adjusted so is above $5,500 this year? Will check at the bank if no one is sure.




Fairly sure it remains at $5500 this year.. Only gets indexed every $500 so it will be a couple of years before going to $6k..


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## maffu (23 May 2012)

jono1887 said:


> Seems like all the big banks aren't offering this account anymore. Which bank have you got this account at?




I am with Commonwealth, I know they stopped issuing more accounts, but I assume some of the others are still offering the product, unless the Government cancelled on new accounts.



robz7777 said:


> Fairly sure it remains at $5500 this year.. Only gets indexed every $500 so it will be a couple of years before going to $6k..




Thanks for that.


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## Junior (24 May 2012)

maffu said:


> I am with Commonwealth, I know they stopped issuing more accounts, but I assume some of the others are still offering the product, unless the Government cancelled on new accounts.
> 
> 
> 
> Thanks for that.




Given the latest budget and scaling back of FYOG it wouldn't be surprising if these accounts aren't available any more.


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## maffu (25 May 2012)

Junior said:


> Given the latest budget and scaling back of FYOG it wouldn't be surprising if these accounts aren't available any more.




A quick search showed ANZ & Commonwealth have stopped these accounts.

http://www.mebank.com.au/personal/savings_accounts/first_home_saver.html
Me Banks still offer them, although to be honest I have never heard of ME bank.


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## Jester (4 June 2012)

I opened one up with ME bank in December last year and have about 3k in there now, all good so far


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## maffu (28 November 2012)

akkopower said:


> I rang the ato the other day, trying to find out when they will pay their contribution.
> 
> they said
> <*60 days after u lodge yr tax return they will send the contribution to your bank and then the bank has no longer than 30 days to put the funds into yr acct.*





2011:
Tax lodged 21/08/2011
Gov Contribution Received 15/11/2011

86 Days between tax lodgement and receiving government payment.

2012:
Tax Refund Recieved: 21/08/2012 (so I would have lodged a week or two earlier.)
Gov Contribution: Missing In Action.

It's been over a 100 days since my girlfriend and I lodged our tax returns, and we have not received the government contribution. I wonder who is holding it up... 
I'm not sure if it is worth speaking to the bank or ATO about, or if it will come through soon.


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## matty77 (28 November 2012)

Just finally got my tax sorted:

2009-10
2010-11
2011-12

and the wife had
2010-11
2011-12

Accountant put the claim in and we got paid 14 days afterwards (funds cleared into our Bank Account)

I nearly fell over in shock it was that quick, totally unexpected!


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## maffu (7 December 2012)

Wow, Matty that was quick.

I found this on the ATO site



> When the payment is credited to you
> We calculate and pay the government contribution in a lump sum once a year. Before we can do this, we need information from you and your account provider. Once we have that information, we have 60 days to work out and pay your contribution.
> We make the payment after:
> your account provider has lodged their activity report with us (due by 31 October each year)
> ...


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