Offset Account Savings Calculator

An offset account is a transaction account linked to your home loan. The balance in the offset reduces the loan balance that interest is charged on. If your loan is $500,000 and your offset has $30,000, you only pay interest on $470,000.

Both save the same amount of interest. The key difference is accessibility — offset funds can be withdrawn anytime, while extra repayments into the loan may need a redraw facility and could be restricted with fixed-rate loans.

Offset accounts typically come with packages costing $300-$400/year. If your offset balance saves more interest than the fee costs, it is worth it. At 6.5%, even a $10,000 balance saves $650/year — well above the fee.

Some lenders offer multiple offset sub-accounts linked to one loan. This can help with budgeting (e.g., separate accounts for bills, savings, emergency fund) while all balances offset your loan interest.