Of course, there are many different ways to save a first home deposit. The benefit of doing it within your super is that you may end up paying less tax, which means you can save a deposit faster.
You can actually save on tax in two ways.
Firstly, you only pay of up to 15% tax on whatever earnings your super contributions make. Outside of super, in another type of investment account, you would have to pay your marginal tax rate on those earnings.
Secondly, if you make before-tax super contributions (such as salary sacrifice contributions), you’ll only have to pay 15% on those contributions as well – and you’ll reduce your taxable income by the total amount of your contributions.
The higher your marginal tax rate, the more you can potentially save.
You can take as long as you want to save a first home deposit with the FHSSS. When you’re ready, you can withdraw up to $15,000 of the contributions you made each financial year with a maximum total withdrawal amount of $50,000 plus associated earnings.
If you’re buying a home with your partner, they can use the FHSSS as well. That means you could potentially withdraw up to $100,000 plus associated earnings to put towards your first home.