This week we return to our podcast episodes recorded prior to Coronavirus. In this episode, we discuss offset accounts, God’s gift to mortgage strategy!
The effective use of offset accounts is one of our Top 5 strategies for creating wealth through property, it greases the wheels of the other mortgage strategies – optimisng tax deductions, ability to hold and accumulate property, money management system, risk management and offset accounts.
In this episode David Johnston, Cate Bakos and Peter Koulizos take you through:
- Optimising tax deductions, how utislising your offset account will help you to save tens of thousands in future tax deductions over your lifetime.
- How offset accounts can help you to hold property you would have otherwise needed to sell. This alone may add $1,000,000 to your bottom line in retirement.
- Calling all upgraders, how you can put your best foot forward and maximise your ability to keep your current home as an investment when you upgrade.
- Why offset accounts and your mortgage strategy are fundamental to your risk management. Counter intuitively, as we have said for a long time, a lower forced payment allows you to build up more savings via your offsets without costing extra interest, allowing you to build up savings buffers and have additional surplus monthly cash flow.
- The government and banks targeted mortgages during this crisis to help the economy. Great to see the government and banks get on board with our long-held mortgage strategy during a crisis!
- An offset account is not the same as redraw; and misappropriation could not only cost you tax deductions, you might also get in trouble with the ATO! There is a critical difference which confuses many and could cause you to fail the ‘purpose test’.
- How offset accounts provide the platform for your Money Management System
- Many lenders now offer multiple offset accounts that can be linked to the one loan keeping more dollars in your pocket through interest savings and better tracking of your spending.
- Interest earning accounts V offset accounts and why an offset account has greater financial benefits to you.
- Interest only V principal and interest – How your repayment strategy can provide you with choice and flexibility whilst optimising your tax deductions, managing risk, growing your cash savings buffer, and enhancing your ability to keep and accumulate property. Counter intuitively, sometimes paying less is more in the long run – if you are using offset accounts of course.
- And of course, our ‘gold nuggets’!
We wish you and your families the best of health and say a big thank you to all our health workers during this time.