Access matters more than people admit
Mortgage repayments improve your position today. Super improves your position later. That sounds obvious, but it is the reason the decision is hard.
Money in super is generally locked away until you meet a condition of release. For most people, that means your preservation age and retirement, or turning 65. Money in an offset account is accessible. Money you have paid into the loan is harder to access unless you have redraw available and the lender allows it.
So you are not only comparing returns. You are comparing liquidity and rules.
Age Pension interactions are real
Your principal home is exempt from the Age Pension assets test. Super is not always exempt. Before Age Pension age, super in accumulation phase is generally not counted under the assets test. Once you reach Age Pension age, super becomes assessable for most people.
This is why two people with the same net worth can have different Age Pension outcomes depending on where the money sits. A dollar inside the home is treated differently from a dollar inside super once you reach Age Pension age.
Key point: If you are likely to be near the Age Pension means test thresholds later, the structure can matter. The home is exempt. Super is assessable at Age Pension age. This can change the trade off.
Run your own numbers
Use SuperCalc Pro to test your retirement plan with Australian super, Age Pension rules, and historical market stress tests.
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