Offset vs dividend shares

Discussion in 'Investment Strategy' started by 1stepcloser, 28th Nov, 2019.

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  1. 1stepcloser

    1stepcloser Well-Known Member

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    Perth
    Hello everyone.

    The time has come for me to rent out my PPOR, i have about $20,000 sitting in an offset account saving me anywhere from $15 - $20 a month on interest.

    $180 to $240 a year roughly.

    If i rent it out there is no point keeping money in the offset account when i could put 20g on a shares returning 5% making $1000 pa.

    Correct??

    Thanks Matt.
     
  2. Trainee

    Trainee Well-Known Member

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    Your only paying 1.2% interest? Doubt it.

    Risk is not the same.

    Offset is worth more for ppor loan because the interest is not tax deductible. Offset against ip still has benefit. Shares can go down.
     
  3. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney

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    Depends.

    Where are you moving to?
    Whats your interest rate?
    will your shares increase or go down in value?
     
  4. 1stepcloser

    1stepcloser Well-Known Member

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    Location:
    Perth
    3.26% interest.
    PPOR is a 4/2 house.
    Moving into a unit down the road,

    While it was a PPOR i was paying maximum i could off loan and putting extra in offset

    Terry probably drop who knows was mainly focus on the dividend. And building portfolio with extra i use to pay off loan.
     
  5. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney

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    Is the unit paid off?
     
  6. 1stepcloser

    1stepcloser Well-Known Member

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    Sorry the unit isnt mine renting it off someone else.

    So ill have investment properties but own no PPOR.
     
  7. Terry_w

    Terry_w Lawyer, Tax Adviser and Mortgage broker in Sydney

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    ok, in that case it if you think you can get a better return on investing the money than you pay in interest it might be worth investing.