A simple way to calculate is to work out if the savings it will bring you each year will cover the ongoing fees. Here’s a simple calculation:
- Annual fee for offset account (or loan package fee) = A
- Home loan interest rate = I
- A ÷ I = the average amount of money you need to have in your offset account to save the cost of the annual fee
Eg. $350 annual fee ÷ 5% home loan interest rate = $7,000 on average you need to have in your offset account to save $350 annually.
Please contact Jonathan Cornish, one of our credit advisers, for more information. Got your own question? Ask us now!