Maintain your Pension Bonus Scheme....................................................................................18

reducing the interest you pay on your mortgage. We recommend that you deposit an initial amount of $XXX from your YYY cash / investment account to open the offset.

Benefits:

 This will assist to meet your goals by reducing the level of interest payable over the term of the loan; we estimate the term of your loan to reduce by XX years.  As interest is calculated daily on your mortgage, any deposits that offset the loan value, will reduce the interest payable. We estimate the 1st year reduction in interest to be $X.  You may pay off your mortgage sooner by reducing the interest expense.  Your salary and income can be automatically redirected to your offset like a bank account.  You will continue to have access to these funds as you need for day to day living and unexpected expenses.

Points to Consider:

 There will be fees to set up the Offset account as well as ongoing fees to maintain it. We estimate establishment costs to be $X and the ongoing fee to be $X p.a.  [No credit licence] We are unable to make specific product recommendations for the selection of your Offset account. Please seek specialist lending advice on this.  Access to your funds may vary from one offset account to another. Check what the requirements are so that you can continue to meet your cash flow needs.

28. Increase the Frequency of your Loan Repayments

We recommend that you increase the frequency of your loan repayments. We recommend that you change from monthly / fortnightly to fortnightly / weekly repayments to be in line with your salary payments.

Benefits:

 We estimate that implementing our recommendations will reduce your loan term by XX years and interest expense over the term of the loan by $YYY. Please refer to our financial projections at the end of the SoA for further details.  You will not need to adjust your current lifestyle to implement the recommendations.  By simply increasing the frequency of your repayments, you can make significant savings.

Points to Consider:

 Changes in interest rates will impact the estimated outcomes of our advice.  Changes to your cash flow should be reviewed by our office immediately as this may impact the appropriateness of our advice.  There may be limits on how much you can repay and the frequency of repayments. This is especially the case with fixed loans.  We have not considered in this advice if your current mortgage is the right mortgage for your situation. This advice only focuses on the cash flow impact to your situation.

29. Increase your Loan Repayments

We recommend that you increase your loan repayments. We recommend that you increase your repayment from $XXX to $YYY per fortnight / month to utilise your cash flow surplus to reduce your loan quicker.

Benefits:

 We estimate that implementing our recommendations will reduce your loan term by XX years and interest expense over the term of the loan by $YYY. Please refer to our financial projections at the end of the SoA for further details.  You will not need to adjust your current lifestyle to implement the recommendations.  Your surplus cash flow will help to reduce your mortgage.

Points to Consider:

 You will have less cash flow surplus at your disposal for unexpected expenditure.  You will need to change your banking transactions to include this increase in payment.