Calculators
Offset account calculator
Every dollar in an offset account reduces the balance you're charged interest on. See how much interest and time your savings could knock off your home loan.
The loan
Your offset account
Savings, emergency fund, salary parked before bills — all of it counts.
Net of what you spend, i.e. what actually stays in the account.
Interest you could save
$276,338
Keeping $25,000 in offset and adding $500 a month means you're effectively debt-free 9 yrs 9 mths sooner.
Time saved
9 yrs 9 mths
Effectively debt-free in
Instead of 30 yrs
20 yrs 3 mths
Monthly repayment
Unchanged — the offset just redirects it from interest to principal
$3,597.30
Interest saved in year one
$25,000 offset at 6.00%
$1,500
Interest without offset
$695,029
Interest with offset
$418,692
Email me these resultsPlus a quick note on what a lender would actually do with them.
What you effectively owe (loan minus offset)
- No offset
- With offset
Under the bonnet
Assumptions & how we calculate
We show our working so you can judge the number, not just read it. Every lender applies its own policy on top of maths like this.
- The offset is 100% (full offset) and interest is calculated monthly on the loan balance minus the offset balance.
- Monthly repayments are fixed at the standard principal & interest amount for the loan with no offset.
- The offset balance is never withdrawn, and your monthly contribution is added at the end of each month.
- The loan is treated as effectively paid off once the offset balance equals the amount owing.
- The rate stays the same, and package fees or rate loadings for offset products aren't included.
The information on this website is general in nature and does not take into account your personal objectives, financial situation or needs. Before acting on any information you should consider whether it is appropriate for you. Terms, conditions, fees, charges and normal lending criteria apply. Rates are subject to change.
FAQs
Questions people ask
How does an offset account work?
It's a transaction or savings account linked to your home loan. The balance is subtracted from what you owe before interest is calculated, so $50,000 in offset on a $600,000 loan means you're charged interest on $550,000.
Is an offset account better than a savings account?
Usually, for home owners. Offset 'earns' your home loan rate, and because it's a saving rather than income, it isn't taxed. A savings account's interest is taxable at your marginal rate.
Do offset accounts cost more?
Often they come with a package fee or a slightly higher rate than a basic loan. If your offset balance is small, the fee can outweigh the saving — something we check when comparing loans.
Does an offset reduce my repayments?
Typically no. Your repayment stays the same, but more of it goes to principal because less is needed for interest. That's what shortens the loan.
Can I have more than one offset account?
Many lenders allow several linked offset accounts, which is handy for separating bills, savings and emergency funds while still offsetting the full amount.
Next step
Numbers looking good? Let's turn them into a pre-approval.
A calculator can't read a payslip or a lender's policy. Sachin can — book a free call and we'll check these numbers against 50+ lenders, then tell you what's actually possible.
Free, no obligation. General information only — not credit advice.