Are you considering buying your first home? It's often challenging to break into the housing market with a substantial down payment. The RRSP Home Buyers Plan (HBP) is designed to help; it allows first time buyers to use money from their RRSP to purchase their first home. You can currently withdraw up to $20,000 tax free to put towards your first home. That number is increasing to $25,000 with the new budget. And if you are purchasing your home with a spouse, you can each withdraw that amount.

You then have up to 15 years to replace the money withdrawn from the RRSP starting the second year after the withdrawal takes place. It's important to note that one fifteenth of the borrowed amount must be paid back to your RRSP each year or it will be added to your income.

I'm often asked if first time buyers must purchase the home for themselves. The home can be purchased for you or a related person with a disability as long as the home is more accessible to that person than their current home or is better suited to their needs. And one final point of interest is that only money contributed to the RRSP over 90 days before the withdrawal date can be used towards the HBP.