Offset or La Trobe Financial Term Deposit for Qantas Points?

Lrliu on 21/03/2024 - 14:20
Last edited 21/03/2024 - 20:08 by 1 other user

Hi all, I need your guys brains!

Received the email about the Qantas 12 month term investment, it said:

Make your money work harder and earn Qantas Points with La Trobe Financial^. To qualify you must make an eligible investment of a minimum of $10,000 in La Trobe Financial’s 12 Month Term Account. Variable rate at 6.65%p.a. (reviewed monthly).

We have some extra money saved in offset account rate at 6.19%. Feel like it is good deal. Can anyone kindly point out if we are wrong :) Thanks in advance.

Thanks for all the reply!

Update the reasons I am asking:

1. I remember the investment longer than 1 year, only 50% the profit will be taxable.

2. Putting in the offset account, but the monthly repayment will remain the same. But put in the term deposit we will get some extra income. (Although we can choose to put in redraw to lower the repayment)

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  jv on 21/03/2024 - 14:38

  Please post on OzFinancialAdvice.

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  blonky on 21/03/2024 - 14:39

  +4

  youll get taxed on the interest income from la trobe. but no tax applicable on the offset reduction

  • 

    Duckie2hh on 21/03/2024 - 14:42

    +1

    @rliu they are also not a bank (ADI license) and therefore your money is at risk if things go belly up.

    Money in offset however is guaranteed by the government*

    *Up to 250K per person per ADI license (bank)

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  Smulder on 21/03/2024 - 14:41

  +3

  You will pay tax on interest income earned on a Term deposit. You won't pay tax on interest saved because the money is in an offset account.

  Depending on your income and financial circumstances this might be something to consider.

  • 

    Smulder on 21/03/2024 - 14:42

    +1

    Yeah what Blonky said…

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  brad1-8tsi on 21/03/2024 - 14:54

  +6

  The 50% discount after 1 year applies to realised capital gains, not interest which is income.

  Just leave your money in the loan offset account

  • 

    rliu on 21/03/2024 - 14:56

    clear now!!! many thanks for the help!

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  trapper on 21/03/2024 - 15:52

  +1

  Offset is a far better option.

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  Drakesy on 21/03/2024 - 16:35

  If you're making less than 9% on your investments you're better off putting it in your offset ;)

  • 

    trapper on 21/03/2024 - 19:58

    Even then a 12 month term investment locks the money away. Offset account is liquid.

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  suti1 on 23/03/2024 - 22:16

  You have been tricked into thinking la trobe offer "term deposits".

  One can only use the word "deposits" if they are a bank/credit union/building society (ie an apra regulated adi). La trobe is not in this category hence they use the phrase "term accounts" .