An FHSA can hold the same kinds of qualified investments as a TFSA or RRSP: cash, GICs, bonds, mutual funds, and stocks and ETFs listed on a designated exchange. What sets it apart is the timeline: the money is usually meant for a home purchase on a known date, so the mix can be matched to how many years are left. This page covers what is allowed and ways to invest by timeline. For the account itself, see the FHSA guide and the FHSA guides directory.
Qualified investments
| Investment type | Examples | Notes |
|---|---|---|
| Cash and savings deposits | FHSA savings accounts | Offered by banks and credit unions |
| GICs | Terms from a few months to five years | Offered inside an FHSA by many issuers |
| Government and savings bonds | Federal and provincial bonds, savings bonds | |
| Mutual funds | Index and actively managed funds | Check what your institution offers |
| Canadian-listed ETFs | All-in-one, equity, bond and money market ETFs | Listed on a designated exchange |
| Stocks on a designated exchange | Canadian and US listed shares | US dividends may have US tax withheld |
| US-listed ETFs | Broad US index ETFs | Listed on a designated exchange; US withholding may apply |
| Certain small business corporation shares | Specific conditions apply |
What an FHSA can’t hold
| Investment | Why not |
|---|---|
| Cryptocurrency held directly | Not a qualified investment (a listed crypto ETF is) |
| Real estate held directly | Property is not a qualified investment |
| Most private company shares | Not listed on a designated exchange |
| Gold or silver that isn’t qualifying bullion | Only bullion coins and bars that meet CRA’s purity and source rules are qualified investments |
Leveraged and inverse ETFs are listed securities and so are generally allowed, but they are built for short-term trading and carry more risk than most FHSA holders take on.
Non-qualified and prohibited investments. If an FHSA acquires a non-qualified investment, CRA charges the holder a tax equal to 50% of its fair market value at the time. The tax can be refunded if the investment is disposed of, or stops being non-qualified, by the end of the following calendar year, unless you knew or should have known it was non-qualified when it was acquired; income earned on it remains taxable to the FHSA trust. A prohibited investment carries the same 50% tax, plus a separate tax on the income and gains it produces.
US dividends inside an FHSA
The Canada-US tax treaty exempts US dividends paid into an RRSP from US withholding tax. That exemption doesn’t extend to the FHSA (or the TFSA), so 15% US withholding generally applies to US dividends paid into an FHSA, and it can’t be recovered. For a US-dividend-heavy holding, that makes the RRSP the more efficient home.
| Account | US dividend withholding |
|---|---|
| RRSP | Exempt under the treaty |
| FHSA | 15% generally withheld |
| TFSA | 15% generally withheld |
Investing by purchase timeline
A market drop the year before you buy can shrink a down payment, while money held in cash for a decade gives up growth. One approach is to scale risk down as the purchase date nears:
| Years to purchase | Common approach |
|---|---|
| One or less | Savings account or short GICs maturing before closing |
| One to two | GICs, money market or short-term bond ETFs |
| Two to four | A balanced mix, for example a 60/40 all-in-one ETF |
| Four to seven | A growth mix, such as an 80/20 or all-equity ETF |
| Seven or more | An all-equity ETF |
A qualifying withdrawal is one-way: it creates no re-participation room, and the account has to be emptied by the end of the following year, so there is no rebuilding a balance that fell just before the purchase. (A taxable withdrawal is different, as covered in withdrawing from an FHSA not for a home.)
Worked example
Someone opens an FHSA, plans to buy in about seven years, and contributes $8,000 at the start of each year into an all-equity ETF. If that portfolio returned exactly 7% a year:
| Year | Contribution | Balance at year end |
|---|---|---|
| 1 | $8,000 | $8,560 |
| 2 | $8,000 | $17,719 |
| 3 | $8,000 | $27,520 |
| 4 | $8,000 | $38,006 |
| 5 | $8,000 (lifetime limit reached) | $49,226 |
In years 6 and 7 there are no more contributions, and a holder following the timeline above would move toward a balanced mix and then GICs or cash ahead of the purchase. Real returns vary from year to year, and can be negative. To model your own numbers, use the FHSA calculator.
FHSA, TFSA or RRSP: what to hold where
| Account | Holdings that suit it | Why |
|---|---|---|
| FHSA | Matched to the purchase date | Tax-free for the home; a fixed horizon |
| TFSA | Longer-term growth | Tax-free for any purpose; withdrawals return as room |
| RRSP | US dividend payers | Treaty exemption from US withholding |
Which account to fund first is covered on FHSA vs TFSA vs RRSP.
All-in-one ETFs often used in an FHSA
| Allocation | Examples |
|---|---|
| About 60% equity / 40% bonds | VBAL, XBAL, ZBAL |
| About 80% equity / 20% bonds | VGRO, XGRO |
| 100% equity | XEQT, VEQT, ZEQT |
Fees and holdings for each are on their review pages and in best ETFs in Canada. For short timelines, current GIC rates are on the EQ Bank GIC rates and best GIC rates pages.
Where you hold it
| Provider type | What you can buy | Costs to check |
|---|---|---|
| Discount brokerage | ETFs, stocks, GICs | Trading commissions and currency conversion |
| Robo-advisor | Managed ETF portfolios | Annual management fee plus fund fees |
| Bank branch | Often the bank’s own funds, GICs and savings | Fund fees |
Providers are compared on best FHSA accounts.
Related guides
Sources
The figures and rules on this page come from these sources, last checked against them between August 29, 2026 and October 12, 2026. How we check facts.
- BlackRock iShares: iShares Core Equity ETF Portfolio | XEQT
- Canada Revenue Agency: FHSA: Investments in your FHSAs
- Canada Revenue Agency: FHSA: Participating in your FHSAs
- Department of Finance Canada: Convention between Canada and the United States of America with Respect to Taxes onβ¦
- Vanguard: Balanced ETF Portfolio | Vanguard Canada
- Vanguard: Growth ETF Portfolio | Vanguard Canada