A smart mortgage offset account can save you thousands, if not tens of thousands, of dollars in interest over the life of your loan. Using the $400,000 loan with $50,000 in a linked offset account as an example.
On a loan with a 3.00 percent annual interest rate, a 25-year term, monthly repayments, and no money in the offset account for the first two years, you would cut your loan term by about 4 years and save nearly $44,000 in interest. That’s also just by making a one-time payment to the offset account; by making recurring contributions, such as by tying your paycheck to the offset account, you may earn a lot more.