Super vs Mortgage Calculator
Got a bit spare each month and torn between tipping it into super or throwing it at the home loan? Pop in your numbers, pick how you'd use the mortgage side — parking cash in an offset account or paying the loan down directly — and see which path leaves you further ahead.
| Super After-Tax Return | — |
| Mortgage Effective Return | — |
| Extra Super — Value at Horizon | $0 |
| Mortgage Benefit | $0 |
Offset, Extra Repayments, or Super — What's Actually Different?
Once the household budget has a bit of slack in it, the same question turns up at every barbecue: does the spare cash do more good in super or against the home loan? And within the mortgage camp there's a second fork — leave the money sitting in an offset account, or make extra repayments and knock the principal down directly. This calculator handles both, which is why the mortgage strategy is a toggle rather than a separate page.
The interest saving from the two mortgage strategies is identical, dollar for dollar — a dollar in the offset stops the same interest as a dollar off the principal. What differs is access. Offset money stays yours to withdraw tomorrow, no questions asked. Extra repayments lock the money into the loan: getting it back means applying for redraw (which lenders can restrict or suspend, and often do on fixed loans) or refinancing. In exchange, extra repayments shorten the loan itself, and there's real value in owning your home outright sooner.
Super plays a different game entirely: instead of a guaranteed saving at your loan rate, it offers a tax concession up front and market returns over time — with the money preserved until age 60 for most people.
How It's Calculated
The comparison is run on a same-take-home-cost basis, which is the honest way to do it. If you have $500 of after-tax money spare each month, the mortgage side simply gets $500 a month. The super side salary sacrifices the pre-tax equivalent — at a 30% marginal rate that's $714 of gross salary, which costs you the same $500 in take-home pay. The fund receives that $714 less the 15% contributions tax, so $607 a month lands in super. Earnings inside super are then modelled net of the 15% accumulation-phase earnings tax, so a 7% gross return is treated as 5.95%. The mortgage saving needs no tax haircut at all: owner-occupier interest isn't deductible, so the saving at your loan rate is entirely tax-free.
Worked Example — Offset Strategy
Say you have $500 a month spare, a salary of $120,000 (30% marginal rate), a 6.0% mortgage, a 7% expected super return, and 15 years to compare. In the offset, $500 a month compounding at the loan rate reaches $145,409 — that's $90,000 of your own deposits plus $55,409 of interest you never paid. Via salary sacrifice, $7,286 a year lands in super after contributions tax and grows at 5.95% net, reaching $168,938. Super finishes ahead by about $23,528 — but the offset money was reachable the whole time, and its return was guaranteed.
Worked Example — Extra Repayments Strategy
Same person, now with a $450,000 loan that has 25 years to run at 6.0%. The standard repayment is $2,899 a month. Adding $500 a month clears the loan 6 years and 10 months early and saves $130,722 in interest over its life, against the same $168,938 on the super side after 15 years. One wrinkle worth knowing: the interest saving accrues over the remaining life of the loan, which here runs a few years past the 15-year super horizon — and once the loan is gone, the freed-up repayments can be put to work too, which this calculator doesn't model.
| Offset account | Extra repayments | Extra super (salary sacrifice) | |
|---|---|---|---|
| Return | Loan rate, guaranteed | Loan rate, guaranteed | Market returns, not guaranteed |
| Tax on the way in | None (after-tax cash) | None (after-tax cash) | 15% instead of your 16–45% marginal rate |
| Tax on returns | None | None | Up to 15% in accumulation phase |
| Access | Immediate | Redraw or refinance | Preserved until age 60 (most people) |
| Side benefit | Flexibility, emergency buffer | Loan paid off years earlier | Bigger retirement balance, annual tax saving |
When the Offset Beats Extra Repayments
Since the interest saving is the same, the offset wins whenever flexibility might matter — which for most households is most of the time. An offset balance doubles as an emergency fund, can be moved to a new loan when you refinance, and avoids redraw risk entirely. Extra repayments make more sense when the discipline helps (money you can't reach is money you won't spend), when your loan has no offset facility or charges a package fee for one, or when being debt-free by a particular date is the actual goal.
When Super Beats Both — and When It Doesn't
Super's edge comes from the gap between your marginal rate and the 15% contributions tax — at a 37% or 45% marginal rate, each dollar of take-home sacrifice puts substantially more than a dollar into the fund, and that head start compounds for as long as the money stays invested. The salary sacrifice calculator shows the annual tax saving on its own. The trade-offs are real, though: returns aren't guaranteed, the money is preserved until age 60, and salary sacrifice only works within your concessional cap room ($32,500 for 2026–27, including the 12% Super Guarantee your employer already pays). The closer you are to preservation age, the smaller the lock-up drawback — and the stronger the super case becomes.
A Combined Approach
Nothing forces a single answer. A common pattern is to hold a comfortable buffer in the offset — three to six months of expenses — then direct the rest into super, sized to your remaining cap room. Worth modelling a few splits here and in the extra contributions calculator before settling on one.