For CareSuper member Martin, the First home super saver (FHSS) scheme made a meaningful difference. Martin and his partner were finding it hard to save a deposit with their everyday bank savings alone. Like many people, rent, living expenses and life getting in the way made progress feel slow. When he learned he could use the FHSS scheme, things started to shift.

Since the scheme was introduced, there have been more than 85,500 FHSS release requests and over $1.1 billion¹ released from super to help Australians purchase their first home, and Martin is one of them. Use of the scheme has been strongest among younger Australians, particularly those in their late 20s and early 30s.²

‘Saving a deposit was really hard. I’d already been making small extra contributions to my super, and then it clicked. I could access some of that money to help buy my first home.’

What is the First home super saver (FHSS) scheme?

The FHSS scheme lets eligible first home buyers make voluntary contributions to their super, then withdraw those contributions, plus associated earnings, to help buy or build their first home.

Because concessional contributions made through super are generally taxed at a lower rate than income earned outside super, the scheme can help you save faster than using a standard savings account alone. Under the FHSS scheme, these voluntary contributions can be made as:

• Concessional (before tax) contributions, such as salary sacrifice or personal contributions you claim as a tax deduction, and

• Non-concessional (after tax) contributions, such as personal contributions that you don’t claim as a tax deduction.

There are limits to how much you can withdraw under the scheme, including restrictions on the number of years of contributions you can access. Eligibility rules also apply, and there are caps on how much you can contribute to your super each year, so it’s important to understand how it works before getting started.

Martin’s experience

Martin did his own research using information from the ATO and CareSuper. One of his main takeaways is to check your contribution history early.

‘I logged into my CareSuper account in Member Online, downloaded my contribution history and matched it up with the ATO records.’

The application process itself happens through myGov, linked to the ATO. The first step is requesting a FHSS scheme determination, which tells you how much you’re eligible to withdraw. You can do this without committing to withdrawing the money straight away. Once Martin was ready, he applied for the release of his FHSS scheme amount.

‘The turnaround was pretty quick, around five business days. But I’d still recommend giving yourself plenty of lead time, especially if you’re buying at auction or working to a deadline.’

How much did it help?

Martin withdrew more than $40,000 through the FHSS scheme to put towards his first home deposit.

‘We honestly wouldn’t have been able to buy our home without it. It would have taken much longer to save that amount outside of super.’

For Martin, the FHSS scheme worked as a long-term strategy rather than a last-minute solution. He’d been contributing small amounts to his super for years, then increased those contributions once buying a home became a clearer goal.

What to be aware of

Martin says the scheme is straightforward once you understand the rules, but there are a few things worth knowing upfront. One is that after you buy your home, you need to notify the ATO within the required timeframe. Missing this step can create issues later. Another is understanding the tax treatment when money is released.

‘The amount you withdraw is added to your taxable income, but you also receive a 30% tax offset.’

Is it right for everyone?

Martin’s honest take is that the benefits can vary depending on your income and circumstances.

‘It doesn’t suit everyone. Generally, the higher your income, the more benefit you may get from the tax side of the scheme. That’s why doing your research and understanding the eligibility rules is so important.’

He also considered the impact of withdrawing money from super on his retirement balance, but felt confident that owning a home would support his long-term financial security too.

‘It still worked towards the same goal: financial stability. And for me, it was the right decision.’

Thinking about the FHSS scheme?

If buying your first home is on your horizon, the First home super saver scheme could be worth exploring. Understanding the rules early and planning ahead can help you decide whether it fits your situation.

Want to learn more about how the FHSS scheme works, eligibility criteria and contribution limits? Find out more and consider whether it’s right for your personal circumstances before making a decision.

If you have questions about your CareSuper account or want help understanding how the scheme works, we’re here to help. Contact us whenever you’re ready.