Which strategy should I choose?

This comparator shows the trade-off, not a recommendation — the right answer depends on your numbers, tax rate and how soon you need the money. Super's tax treatment tends to produce a larger balance over long horizons, but it's the least accessible option of the three, so a larger projected figure isn't automatically the better outcome for your situation.

Why does the offset account compare against my mortgage rate?

Money in an offset account doesn't earn a taxable return — it reduces the interest calculated on your mortgage. Saving interest at your mortgage rate is economically equivalent to earning that rate tax-free, so that's the fairest comparison to the other options.

Does the mortgage balance stay the same for the whole comparison?

No — it amortises on the level repayment implied by your balance, your rate and the years you have left, and that matters more than it sounds. An offset only saves interest on the part of your balance the loan actually covers, so as the loan shrinks the cap falls with it. At the defaults on this page ($400,000 over 25 years at 6.3%, $1,000 a month for 20 years) the loan is down to about $136,143 by year 20, while your contributions alone come to $240,000 — so the offset passes what is left of the loan well before the horizon and part of it earns nothing from then on. The results card names how many months that was true for, and if the loan is discharged inside your horizon it says which month.

Is putting extra money into super always better for tax?

Concessional super contributions are taxed at 15% instead of your marginal rate, which is usually a saving for anyone on more than the lowest tax bracket. But you're locking the money away until preservation age, and you're still capped by the annual concessional contributions limit.

Does this model include capital gains tax on the ETF strategy?

Yes, since August 2026. It taxes the ETF's distributions each year, grossed up for franking credits at your marginal rate, and then deducts the capital gains tax on selling the whole holding at the end of your horizon. The gain is worked out one parcel at a time — every monthly contribution and every year's reinvested distribution is its own parcel with its own acquisition date — because the rules turn on that date: a parcel acquired on or after 1 July 2027 gets no CGT discount at all, and a parcel held across that date has its cost base reset to market value then, with only the earlier part of the gain discounted at 50%. Two things are left out and both mean the real tax could be higher, not lower: the cost base is not indexed for CPI (that would need a CPI forecast, and this tool does not forecast), and the 30% minimum tax on capital gains is not applied because it depends on your total income for the year.

Why is the ETF's cost base higher than what I contributed?

Because reinvested distributions form part of it. The distributions are assessed as income in the year you receive them, and the units they buy have a cost base equal to what was reinvested — which is why ETF investors have to keep their reinvestment statements. Ignoring that would tax the same dollars twice: once as income and again as a capital gain. At this page's defaults the cost base comes to $355,386 against $240,000 of contributions, so leaving the reinvestments out would invent $115,386 of tax base that does not exist.

What happened to the property deposit option?

It was removed in August 2026 because it was not really a fourth strategy. It ran the same compounding as the ETF with the tax line deleted, which made it arithmetically the ETF plus all of the ETF's tax, so it came first for every possible input — set the marginal rate to zero and the two were equal to the dollar. Saving a deposit is a genuine question, but it is a savings-goal question rather than a differently-taxed investment: use the Home Deposit Calculator for how long it takes, or the Savings Goals Calculator for a target amount.

How accurate is a single growth-rate assumption over 20 years?

Not very, in the sense that markets never grow at a smooth constant rate — some years fall sharply and others rise sharply. The growth rate here is a simplifying assumption to make the strategies comparable, not a prediction of actual year-by-year performance.

Investment Strategy Comparator

Compare an ETF outside super, extra super and a mortgage offset

Same contribution, same horizon, three completely different tax treatments

Inputs

Monthly contribution, horizon and assumptions

Monthly contribution ($)

Horizon (years)

Growth rate (% p.a.)

Your marginal tax rate (incl. Medicare levy)

ETF cash dividend yield (% p.a.)

Your assumption, not a published rate. Assumed fully franked and reinvested — this is what drives the ETF's annual tax drag.

Mortgage rate (%) - for offset

Mortgage balance ($) - for offset

Years left on the mortgage

The loan is repaid over this term, so its balance falls — and the offset stops earning on anything above what's left of it.

Strategy comparison

Wealth after 20 years, ranked

ETF (outside super, after CGT)$428,293

$261,375 in today's dollars

You contribute: $240,000
Growth: $225,979
Tax paid: $37,686

Offset (mortgage)$416,837

$254,383 in today's dollars

You contribute: $240,000
Interest saved: $176,837
Tax paid: $0

Super (concessional)$356,941

$217,830 in today's dollars

You contribute: $240,000
Growth: $179,930
Tax paid: $62,990

Totals are in future dollars. Each today's-dollars figure converts its total back over 20 years at 2.5% inflation, so you can read it against what money buys now.

The ETF's capital gains tax, if you sold the whole holding on 2046-08-18

Proceeds: $462,585
Cost base: $355,386
Taxable gain: $107,163
Tax on the gain: $34,292

Your mortgage over the same period

Monthly repayment: $2,651
Balance at your horizon: $136,143
Months your offset exceeded it: 77

Capital gains tax on the ETF is worked out parcel by parcel — 260 of them, one for each contribution and one for each year's reinvested distribution — against the acquisition date each one actually has. 250 were acquired on or after 1 July 2027, so they get no CGT discount at all: the discount percentage for a listed security is 0% from that date. 10 are held across 1 July 2027, so their cost base is reset to market value at that date and only the pre-reset part of the gain is discounted at 50%.
The reset cost base is not indexed for CPI here, because indexing it would need a CPI forecast out to your horizon and this tool does not forecast anything. Real indexation would reduce the ETF's capital gains tax, so its total is the low end of a range rather than the high end.
The 30% minimum tax on capital gains (s119-10) is not included. It depends on your total income for the year, which this tool does not collect, and it can only add tax — never reduce it.
Reinvested distributions are included in the ETF's cost base. They were already taxed as income each year, so counting them as a capital gain as well would tax the same dollars twice.
$106 of capital losses on individual parcels are not offset against other parcels' gains here, so the ETF's capital gains tax is overstated by up to $34. A real return would net them off. It happens because a distribution drops the unit price, so a parcel bought shortly before one can still be below its cost at the horizon — and it grows into the whole portfolio if the yield you entered approaches the total return.
For 77 of the 240 months your offset balance is larger than what is left of the loan, so only part of it is earning the mortgage rate. The loan is down to $136,143 by the horizon.

Super is shown as a fund balance you cannot access until preservation age, and no tax is deducted from it on the way out — for someone over 60 taking a lump sum from a taxed fund, none is due.

Official sources

The statutory figures here are the 15% super contributions tax, the 15% tax on a fund's accumulation-phase earnings, the 30% franking rate and the capital gains rules in Treasury Laws Amendment (Tax Reform No. 1) Act 2026, which from 1 July 2027 removes the CGT discount for listed securities and resets the cost base of anything held across that date. The ETF's capital gains tax is computed parcel by parcel under those rules. Growth, your marginal rate, the dividend yield, the mortgage rate and the years left on your mortgage are your assumptions, not forecasts.

How to Use This Calculator

1Enter the amount you can contribute each month and the time horizon you're investing over
2Set an expected annual growth rate and your marginal tax rate
3Add your mortgage rate, balance and the years left on it if you want the offset account included — the remaining term is what makes the balance fall, and a falling balance caps what an offset can earn
4Compare the after-tax wealth each strategy produces at the end of your horizon, with the ETF shown after the capital gains tax on selling it

What does this comparator model?

This tool compares three common places to put extra money in Australia, using the same monthly contribution and time horizon for each so the comparison is apples-to-apples: an ETF or share portfolio outside super, additional concessional superannuation contributions, and a mortgage offset account.

Each option is taxed completely differently, which is the whole reason to compare them rather than just comparing headline growth rates. An ETF held outside super pays tax on its distributions every year — grossed up for franking credits, taxed at your marginal rate, then reduced by the credit, which is a refund rather than a bill if your rate is below 30% — and then capital gains tax when you sell, which is deducted from the figure shown. Extra super contributions are taxed at 15% going in and the fund pays up to 15% on its earnings after that. Money in an offset account earns no taxable return at all — it reduces the interest you're charged, which is why saving interest at your mortgage rate is the fairest comparison, and why the benefit stops growing once your offset balance reaches what is left of your loan.

The ETF's capital gains tax is where the 2027 reform bites hardest, and it is the reason this comparison is not simply "super wins over long horizons". From 1 July 2027 the CGT discount for a listed security is 0% (Treasury Laws Amendment (Tax Reform No. 1) Act 2026), so on a long horizon most of an ETF's parcels are taxed on the whole gain at your marginal rate. Parcels you already hold on that date are treated differently again: their cost base is reset to market value at 1 July 2027 and only the gain up to that point keeps the 50% discount. This tool works that out one parcel at a time, on the acquisition date each contribution and each reinvested distribution actually has.

None of this accounts for market volatility — the model assumes a steady annual growth rate for the whole horizon, which real markets never actually deliver. Treat the output as a comparison of the tax and structural differences between strategies, not a forecast of what any of them will actually return.

What actually separates these strategies

Tax treatment: Super's 15% contributions tax and 15% earnings tax are the comparison, and they do not change on 1 July 2027. The ETF does: from that date its distributions are still taxed at your marginal rate each year, and the whole capital gain is taxed at your marginal rate on sale with no discount, which widens the gap. Whether that decides it depends on when you can actually access the money.
Access and liquidity: Super is locked away until you reach preservation age; an ETF portfolio and an offset account are both accessible at any time, which matters if your horizon might change.
Risk profile: An offset account has zero market risk — the return is a guaranteed reduction in mortgage interest, capped at whatever is left of your loan. That cap is the thing people forget: the loan is being repaid the whole time, so an offset balance that overtakes it stops earning anything on the excess.
Time horizon: The tax advantage of super compounds the longer you leave it, which is why it tends to look best over 15-20+ year horizons and least attractive if you might need the money within a few years.

Getting a realistic comparison

•Use a conservative growth rate — the 6.1% this page starts on is a common long-run assumption for diversified shares, but any single number smooths over the real volatility you'd actually experience
•If you're likely to need the money before preservation age, the ETF and offset options stay accessible while super does not — factor that into how you read the raw numbers for super
•Extra super contributions are still subject to the concessional contributions cap — check the super contributions tracker before assuming you can add an unlimited amount
•An offset account's 'return' is really just interest saved, so compare it against your actual mortgage rate, not a market growth assumption — and enter the real years left on the loan, because the benefit stops the moment the loan is discharged

Frequently Asked Questions

Official Sources

Estimates only. Not financial or tax advice. Full disclaimer for your rights and our limitations of liability.

About this calculator

This calculator exists to show you the arithmetic. It applies published Australian rates, thresholds and formulas to the numbers you enter and shows the working, so you can check it. That is all it does — it produces a number and describes what the number is. It does not recommend anything and it holds no opinion about any financial product.

What can move this result

It only knows the figures you type in. Offsets, deductions, prior-year losses, other income, your partner's position and anything you have not entered are not in the result, and any of them can move it a long way.
Rates and thresholds change, sometimes mid-year and occasionally with retrospective effect. Each calculator shows the financial year and the verification date it is working from — outside that year the result is wrong rather than approximate.
Assumptions are set to a reasonable default and every non-statutory one can be changed. Defaults are not predictions, and a small change to a growth or inflation assumption compounds into a large change in a long projection.
Where a result reaches two or more years into the future it is shown in today's dollars as well as future dollars, because a future-dollar figure overstates what the money will actually buy.
It is a generic calculator. It is not built around any particular product, it does not compare the market, and it cannot tell you whether a product is suitable for you.

Why these default assumptions are reasonable

Investment growth rate — 6.1% a year. ASIC Moneysmart's published net return for a balanced portfolio, shared with the FIRE planner deliberately so the site never assumes two different returns for the same asset class on different pages. Outside super your own tax applies to distributions and realised gains, which the comparison models separately — so the growth figure stays a pre-personal-tax scenario setting you should vary. Source · You can change this input.
Mortgage rate — 6.3% a year. The RBA's published average variable rate on outstanding owner-occupier loans (statistical table F6, June 2026) — what an existing mortgage actually pays on average, which is the loan this comparison pays down. Your own rate is the figure that matters and replaces it. Source · You can change this input.

This calculator is not intended to be relied on for the purposes of making a decision in relation to a financial product. Before you make a financial decision, consider obtaining advice from someone who holds an Australian Financial Services Licence. We do not, and we cannot advise you.

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About this calculator

What can move this result

It only knows the figures you type in. Offsets, deductions, prior-year losses, other income, your partner's position and anything you have not entered are not in the result, and any of them can move it a long way.
Rates and thresholds change, sometimes mid-year and occasionally with retrospective effect. Each calculator shows the financial year and the verification date it is working from — outside that year the result is wrong rather than approximate.
Assumptions are set to a reasonable default and every non-statutory one can be changed. Defaults are not predictions, and a small change to a growth or inflation assumption compounds into a large change in a long projection.
Where a result reaches two or more years into the future it is shown in today's dollars as well as future dollars, because a future-dollar figure overstates what the money will actually buy.
It is a generic calculator. It is not built around any particular product, it does not compare the market, and it cannot tell you whether a product is suitable for you.

Why these default assumptions are reasonable

Investment growth rate — 6.1% a year. ASIC Moneysmart's published net return for a balanced portfolio, shared with the FIRE planner deliberately so the site never assumes two different returns for the same asset class on different pages. Outside super your own tax applies to distributions and realised gains, which the comparison models separately — so the growth figure stays a pre-personal-tax scenario setting you should vary. Source · You can change this input.
Mortgage rate — 6.3% a year. The RBA's published average variable rate on outstanding owner-occupier loans (statistical table F6, June 2026) — what an existing mortgage actually pays on average, which is the loan this comparison pays down. Your own rate is the figure that matters and replaces it. Source · You can change this input.