88. Savings vs offset vs investing: How each stacks up at 6% interest rates
About this episode
The episode discusses the impact of rising interest rates on savings, offset accounts, and investment strategies.
A few years ago mortgages were under 2% and cash earned you nothing. Now rates sit around 6% and every option looks different: savings accounts are suddenly respectable, offsets feel like a guaranteed win, and borrowing to invest looks scarier than it maybe is. Dave and Hayden work through how a high-rate environment reshuffles the deck, and the mental shortcuts that lead people astray in both directions. In this episode we'll discuss: 💸 Savings accounts are back, but interest is taxed at your marginal rate, and plenty of high earners forget that 5% is really more like 3% 💸 A quick test for whether you're carrying too much debt: how nervous do you get before RBA meetings? 💸 Dave's peak-debt confession: millions owed in his twenties, and why a 2% rate rise would have broken the strategy 💸 The offset trap: why "a guaranteed 6% return" isn't permanent (it moves with rates), and why "6% tax-free equals 10% invested" is the wrong comparison. Compare after-tax returns to after-tax returns 💸 Waiting for rate cuts before investing: why asset prices reprice on the way down, and if everyone has the same plan, you need to be early for it to work 💸 Dave's counterintuitive maths on…
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