most recent 30 from http://www.ourluckydime.com 2010-08-01T04:26:26Z http://www.ourluckydime.com/feeds/tag/emergency-fund http://www.creativecommons.org/licenses/by-nc/2.5/rdf http://www.ourluckydime.com/questions/23/what-are-the-advantages-and-disadvantages-of-a-mortgage-offset-account avm 2009-09-28T09:17:00Z 2009-10-21T22:17:49Z

<p>I have a mortgage offset account with 100% offset. I also have enough money in this account, that I am not paying any interest on the mortgage. I don't want to prepay as there is a pre-payment penalty clause. Also, the amount in the offset account is what I use as an emergency fund and an opportunity fund. </p> <p>I have other investments in bonds and equity, but due to the large mortgage offset, the cash component of my portfolio is quite high and skewing the asset allocation.</p> <p>I wonder if I am really getting the best deal out of the offset account and want to see what other's opinions and experiences are. Even though there is no interest, paying the principal will still take another 6 years to finish off the loan. I am effectively getting a return of 7.5% on the offset amount, while still having it liquid. In comparison, the government bond (tax-free) is 8%, but locked for 5 years.</p>