Would we be better off putting our funds in a term deposit or
managed fund account?
Q.
We currently have $120k in our mortgage offset account. Without
the offset I have estimated we would be paying approximately $400
extra in interest per month. Would we be better off putting the
funds in a term deposit or managed fund account?
A.
The benefit of the offset account is that the interest is not
taxable and if it is paying you the same as the mortgage rate, you
will be getting the equivalent of nine percent per annum tax free.
No term deposit can beat that. If you wish to buy managed funds, I
suggest you borrow because the interest will be tax deductible.
Each week financial advisor Noel Whittaker answers your
questions.
