Offset Savings Calculator

[2kindsofsorrow]

I recently created this offset account savings calculator in Excel, to analyse how I might repay my home loan sooner with different scenarios.

It calculates the instalment schedule based on the loan amount, term in years and interest rate.

It then allows you to run up to 3 different scenarios and determine your interest saved and term reduction based on your initial offset balance, ongoing contributions and whether you wish to settle early once your offset savings are equal to the outstanding loan balance.

Hopefully others might find this useful or interesting. Feedback is welcome.

https://www.personalfinatics.com/post/slice-your-home-loan-in-half-with-an-offset-account#viewer-1t21d9125

https://preview.redd.it/8fgxshk26go...bp&s=1570a403bd747b2cb64fb8ad65032908e0be56cd

 

[len1973]

@2kindsofsorrow Handy. It's always cool to see how much you save if you do it really early on. Just saving an extra $5k in the first year can be tens of thousands over the loan.

 

[hopeon]

@len1973 That's the function of time? Putting 5k away in year 1 means it's reducing the loan over 29 years. Doing the same in year 25 only reduces it over 5.

 

[len1973]

@hopeon The point is more that if you have the means to save, do it as early as you can.

 

[edwardcruri]

@2kindsofsorrow Nice tidy spreadsheet, well done.

Try proof checking outputs against https://figura.finance/ and see how it goes.

 

[antcart]

@2kindsofsorrow Nice work. The dashboard was easy to fill in.

Feedback:

• The 2 shades of blue for scenarios #2 and #3 might be hard for some people to differentiate (not enough contrast)
• Would it change the trajectory if the loan was repaid fortnightly?

I was using the figura finance one, but this one is more visually engaging and simpler to use.

 

[2kindsofsorrow]

@antcart Appreciate the kind words.

For fortnightly repayments, the instalment would be slightly smaller (in monthly terms) as the total interest costs would be less, due to the earlier payments vs a monthly frequency.

The trajectory would therefore be flatter, but not sure how meaningful/apparent that would be.

 

[timmdogg]

@2kindsofsorrow As some feedback, this doesn't seem to work with Google Sheets. Would make it a lot more accessible to a bigger audience if it was. A very cool, simple visual aid though. I like the graph and being able to compare the different scenarios are nice.

 

[2kindsofsorrow]

@timmdogg Thanks for the feedback. Didn't think about making it Google sheets compatible, will give it a try.

 

[nadira]

@2kindsofsorrow Aren't most loans with offset accounts permitted higher interest?