Calculators
Offset account calculator
See how much interest money in an offset account could save, and how much sooner you could repay your home loan.
Average balance kept in the offset account
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Interest saved over the loan
$135,869
Loan repaid in 26 years 11 months, 3 years 1 month sooner
- Interest saved this month
- $153
- Repayment (unchanged)
- $3,636 / mth
General information and estimates only. Assumes a principal-and-interest loan with interest calculated and repaid monthly at a constant rate, and no fees. Your lender’s calculation, rate changes and fees will change the result. Not financial product advice. Assumes the offset balance stays the same for the life of the loan and is fully offset (100%).
How the saving is estimated
The calculator compares two versions of the same loan: one without an offset and one where interest is charged only on the balance above your offset amount. The repayment stays the same in both, so the offset version is repaid sooner.
When the RBA raises the cash rate, an offset balance saves more because the rate it offsets is higher. See the next RBA decision or compare with extra repayments.
Common questions
How does an offset account work?
An offset account is a transaction account linked to your home loan. The lender subtracts its balance from your loan balance before charging interest. Your repayment usually stays the same, so more of each repayment goes to the principal and the loan is paid off sooner.
Is an offset account better than making extra repayments?
At the same interest rate, a dollar in a full offset account saves the same interest as a dollar of extra repayment. The difference is access: offset money stays in your own account, while extra repayments may only be reachable through redraw, which can have limits. Offset accounts sometimes come with higher rates or package fees, which can outweigh the benefit on small balances.
Is the interest saved taxed?
Interest saved through an offset account on your home is not income, so unlike interest earned in a savings account it is generally not taxed. Investment loans can be different; check with a tax adviser.
What if my offset balance changes?
This calculator assumes the balance stays the same. In practice interest is calculated daily on the actual balance, so keeping your salary in the offset and paying expenses from a credit card you clear in full can increase the saving.