Unlock the Power of Offsets: Paying Less on Your Home Loan
The term “offset account” gets thrown around a lot, but what does it really mean for your homeownership journey? Let’s break it down.
Your Home Loan's New Best Friend
Imagine your offset account as a sidekick to your home loan. It’s a special type of savings account directly linked to your mortgage. Every dollar you stash in your offset account works to reduce the amount your lender uses to calculate the interest you owe. Less to pay interest on means more in your pocket!
The Perks of an Offset
Slash Your Interest Costs: This is the big draw of an offset. The more you have in there, the less interest you’ll pay over the life of your loan, potentially saving you thousands.
Everyday Access: An offset account is just like your regular savings account—you can use it for direct debits and BPAY and some even come with a snazzy Visa debit card.
Multiple Offsets, Multiple Goals: Some lenders offer multiple offset accounts, letting you separate your finances for different goals – maybe one for personal savings, one for a holiday fund or even one for the kids!
The Potential Catch
Fees: Offset accounts usually come with an annual fee, but the savings on interest often outweigh this cost.
Not Always 100% Offset: Double-check with your lender. Some offset accounts only reduce your interest-owing balance by a portion of your saved amount.
You First Finance: Making Offsets Work for You
Confused about whether an offset account is right for your situation? At You First Finance, we help you weigh the pros and cons and find the smartest strategies to optimise your home loan.
Get in touch and let’s explore how to make the most of your hard-earned money!
