Australians are getting smarter with their mortgages – and the latest numbers prove it.
According to APRA, the nation’s banking regulator, borrowers are putting more money than ever into offset accounts. In the June quarter, the average borrower had $11,435 sitting in offset for every $100,000 they owed on their loan. That’s up from $10,647 just a year earlier – a meaningful jump that highlights how households are working to cut the cost of interest and take back some control.
What Exactly Is an Offset Account?
Think of an offset account as a regular bank account that’s tied to your mortgage. You can use it for your salary, savings, and everyday spending, but here’s the kicker: every dollar in the account offsets your loan balance, meaning you’re charged interest on a smaller amount.
For example:
If your home loan balance is $500,000 and you keep $20,000 in offset, the bank charges you interest on $480,000 instead of the full amount. Over a 30-year loan at 5.68%, that could add up to savings of $100 or more every month – and tens of thousands over the life of your loan.*
Why More Aussies Are Turning to Offsets
With interest rates shifting and cost-of-living pressures still high, households are looking for ways to stay ahead. An offset account is flexible – you can dip into the money anytime you need it – but it also rewards those who regularly keep a healthy balance. It’s like having your savings quietly working for you, reducing your interest bill day by day.
When an Offset Account Works Best
✅ You’ve got a decent savings buffer or regular income flowing through the account
✅ You want the flexibility to access cash anytime without locking it away
✅ You like the idea of shaving down interest while still having liquidity
When an Offset Might Not Be Worth It
❌ Your balance is usually low – the monthly or annual fees could cost more than the savings
❌ You’d be better off with a simple home loan at a lower interest rate (without the offset feature)
Offset accounts aren’t a one-size-fits-all solution – but for many Australians, they’re proving to be a powerful tool in the fight against rising costs. Whether you’re an investor, a first-home buyer, or simply looking to manage your loan smarter, understanding how offsets work could make a big difference to your financial future.
📲 Curious if an offset account could work for you? Let’s chat about your situation and crunch the numbers together.
*Example only – actual savings depend on your loan, rate, fees and personal circumstances. This isn’t financial advice.
