See how much interest an offset account balance can save you each year.
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Change loan balance to see how estimated annual interest saved responds.
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Estimated annual interest saved is included so you can interpret this estimate and make a better-informed comparison.
Interest charged with offset is included so you can interpret this estimate and make a better-informed comparison.
Interest without offset is included so you can interpret this estimate and make a better-informed comparison.
Interest after planned redraw is included so you can interpret this estimate and make a better-informed comparison.
An offset account reduces the loan balance interest is calculated on, without actually reducing your minimum required repayment — so every dollar sitting in the offset account effectively earns you your loan's interest rate, tax-free.
Interest without an offset is calculated on the full loan balance. Interest with the offset is calculated on the balance minus your offset amount. The difference between the two is your estimated annual saving.
This is a simplified annual snapshot — it doesn't account for the offset balance or loan balance changing during the year, or how the saving compounds into a shorter effective loan term if you keep repayments the same.
Keep as much everyday cash as practical in your offset account rather than a separate savings account, since the saving is effectively equal to your loan rate rather than a taxable savings interest rate.
Australia-specific contextFigures use AUD and current published rates and thresholds.
Reviewed for clarityUpdated 3 August 2026.
ImportantFor planning and educational use — not tax, legal or financial advice.
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No — because it's a reduction in interest charged rather than interest earned, it isn't assessable income, which is why offset accounts are often more efficient than savings accounts.
An offset is a separate transaction account linked to your loan; redraw lets you access extra repayments you've already made directly from the loan itself. Both reduce interest, but they behave differently.
A 100% offset offsets the full balance dollar-for-dollar as used here; a partial offset only offsets a percentage of your balance, so check which type your loan has.
The interest saved effectively goes towards principal faster, which can shorten your loan term even though your calculated minimum repayment doesn't change.
Rules and thresholds used by this calculator are labelled for 2026–27 or formula-labelled period. Review the primary guidance before making a filing, borrowing, benefit or investment decision.
Last source review: 3 August 2026. Calculator results are estimates and may exclude circumstances described in the methodology.
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