Find the calculator under Tools → Calculators → Debt recycling calculator. On each visit or reload, read the Advanced user warning: tool in beta and linked financial services guide (FSG). Choose I have read the FSG and agree to continue, or Back to safety to return to the calculators hub. Your choice is recorded in your account’s audit log.

The calculator opens on Setup, which contains the Household, Mortgage and Investment strategy input panels. Choose Edit, change the figures, then Apply to update the charts. Cancel discards edits to that panel. Available profile figures are starting points to check. Your simulation does not update your saved financial profile. Invalid numbers stay visible with an explanation; correct them before selecting Apply. Switching to a single household keeps the second person’s last applied details, rather than applying hidden edits.

Use the information icon beside each assumption for a plain-language explanation and example. Hover, focus with your keyboard, or tap the icon.

Set your assumptions

• Household: salary, salary growth, age, retirement age and living costs. Salary stops at retirement; no pension income is assumed. Each owner’s marginal tax rate is estimated from their starting salary and levies. Switching to Couple uses both salaries and family Medicare levy surcharge thresholds, so the automatic estimate can change. An entered rate overrides the estimate and is kept when household settings change. The rate stays fixed within each projection for investment income, deductions and gains.
• Mortgage: existing balance, interest rate and remaining term. P&I payments are calculated monthly and maintained after the initial cash repayment.
• Investment strategy: cash available, recycling chunk size, investment loan rate, capital growth, cash dividend yield and franking percentage. Franking defaults to 100% and can be changed. Additional borrowing defaults to $0; entering an amount explicitly increases the loan ceiling.

Both strategies start with the same cash. Invest with cash buys shares outright. With debt recycling pays that cash into the home loan, then redraws whole chunks into the investment loan and buys shares. The model assumes the investment loan and investments have matching ownership and interest is deductible.

For example, with a $500,000 mortgage, $100,000 cash and $50,000 chunks, recycling starts with a $400,000 home loan, a $100,000 investment loan and $100,000 invested. The cash strategy starts with a $500,000 home loan and $100,000 invested outright. Their starting net wealth is equal.

Each month, repayments reduce the home loan. Available redraw is the loan ceiling minus the combined home and investment balances. The redraw is the largest whole multiple of the chosen chunk that fits. With $73,000 available and a $50,000 chunk, draw $50,000 and leave $23,000 reducing home-loan interest until another chunk is ready. When the home loan reaches zero, the final redraw may be smaller. This assumes a suitable loan facility permits reborrowing up to that ceiling. Without additional borrowing, total debt never exceeds the original loan.

Choose whether to reinvest spare salary cash, dividends and tax benefits. The cash strategy buys shares directly; recycling first pays down and redraws home debt. Once the home loan is repaid, selected cash buys shares directly. Available cash limits contributions; a deficit is shown rather than automatically borrowed.

Read the results

Switch from Setup to the results tabs to view full-width charts and tables. Assumptions, after Calculations, opens with return and rate scenarios, followed by the Important assumptions, grouped into forecast and inputs, borrowing and lender approval, and tax, cash flow and exclusions. Switching tabs keeps unfinished input edits until you apply or cancel them.

Strategy opens with the potential-benefit chart. Expand What could you do today? to see the initial repayment, redraw, both loan balances, remaining chunk capacity and first-year activity. The 4× gross salary indicator is a rough total-debt benchmark, not a minimum borrowing entitlement or loan approval.

The after-tax column chart compares investments after indicative CGT, less both loans, plus accumulated unspent cash or funding shortfalls. Unspent cash earns 0%. Both strategies use the same starting cash, household income and living costs. Property and other assets are excluded from both; the result is a strategy difference, not total household wealth.

What debt recycling could do (potentially) compares the two strategies after estimated sale tax and cash flow. A positive benefit means recycling finishes ahead; a negative amount is a shortfall. This is not personalised financial advice. Discuss your circumstances with your financial adviser before acting.

The comparison table includes Portfolio balance CAGR, calculated from each starting and ending portfolio balance over the selected years. It includes new cash contributions and redraws, excludes debt and CGT, and is not an investment return. It is unavailable when the starting or ending balance is non-positive, or after selling the portfolio. Annualised after-tax advantage vs cash is (recycling net position / cash net position)^(1 / years) - 1. This compares ending outcomes; it is not a CAGR for either strategy. It needs both ending positions to be positive. In particular, a negative opening net position cannot be used to produce a meaningful ordinary net-position CAGR.

Under Assumptions, Test your return and rate assumptions shows lower-growth/higher-interest and higher-growth cases, holding dividend yield and franking unchanged. Compare the result with cash shortfalls as well as returns.

Mortgage, Investment and Cashflow show loan repayment, portfolio compounding and household cash flow. The comparison tables start at the forecast horizon. Use the settings icon after Assumptions to choose another year or return to the forecast horizon. Hovering over charts shows yearly values without changing the comparison year. Charts and Calculations use the same annual data. Cashflow uses stacked columns: money received is positive and payments are negative. Only surplus / deficit is shown as a line. The cash-investment and unallocated-surplus rows show the selected year’s values; a fully reinvested surplus sits at zero. Interest coverage uses the labelled right percentage axis, while loan interest uses the left dollar axis.

The Mortgage table separates scheduled principal, extra repayments, annual redraws, both loan balances, total debt and capacity waiting for the next chunk. Investment includes direct cash purchases. Household separates dividend tax, franking credits and the interest tax benefit. After tax reconciles both strategies’ cash and net positions. The Today row shows balances after the initial repayment and redraw. Download data exports both strategies and inputs.

Sell investments and repay investment loan sells at the end of the year the home loan is repaid. CGT is deducted before repaying the investment loan. Any remaining debt stays visible; surplus sale proceeds stay in cash at 0%. The CGT table also shows a hypothetical sale each year when no sale occurs.

Save and return

Save stores your simulation immediately with a default name. Open Saved simulations to see its saved date, rename it with the pencil button, or reopen it. Editing and saving again stores a new result under the same simulation. Save as appears after the first save and creates a separate copy; you can rename the copy in Saved simulations.

Archive removes a simulation from your active list while retaining its history. Download report exports the saved result as a PDF; save changes before downloading. Maximise expands the workspace.

Saved results keep the inputs and tax reference used when they were run. Reopening a result does not replace its tax rates with today’s reference. Changes and a new save use the current reference shown in the calculator. Older simulations retain their original additional-borrowing model and are read-only. Choose Start a cash-recycling simulation to create a separate simulation under the current model.

Tax and modelling limits

Borrowed principal is not income; principal repayments are not tax deductions. Interest is assumed fully deductible at the selected fixed marginal tax rate. Dividend yield remains separate from capital growth because dividends are taxed as they arise, while unrealised growth is not taxed annually.

Franking credits are grossed up and offset once. For a cash dividend D, franked fraction f, company tax rate c and marginal tax rate m:

• Franking credits = D × f × c ÷ (1 − c).
• Dividend tax after credits = (D + credits) × m − credits.
• Interest tax benefit = investment interest × m.

At 47%, $6,000 interest produces a $2,820 tax benefit. A $3,000 fully franked cash dividend at a 30% company rate carries $1,285.71 in credits and $728.57 in net personal tax. Combined, the interest and dividends reduce salary-only tax by $2,091.43. Partial franking reduces the credit proportionally. See the Parliamentary Budget Office’s franking explanation.

The engine uses Rask’s shared tax reference for salary tax, levies, company rate and CGT discount. Investment marginal rates and that reference remain fixed. CGT tracks parcel holding periods, with no carried-forward losses. Returns, distributions and tax cash flows are modelled monthly; this assumes tax benefits are available during the year. Annual refund timing can change compounding. Fees, low-income adjustments, HELP, pension income, market volatility and future tax-law changes are excluded. Property values, LVR, lending approval and franking eligibility are not tested. The model assumes the selected loan structure and investment use support deductibility.

Using your Rask information

A new simulation can prefill your recorded name, age, household type, salary (excluding super), and an eligible principal-and-interest home loan. If you have more than one eligible loan, choose which one to use. You can review a living expense subtotal before applying it; bank and offset balances are a reference only. Choose your own amount to invest.

Opening a saved simulation keeps its saved inputs. Prefill calculator explicitly refreshes the available current facts without changing that saved run. Other settings remain assumptions for the simulation. After prefilling, the information panel minimises. Select Your Rask information to reopen it and review the available details.

After you save, Update your Rask account too? may offer changed salaries and current details for your selected home loan. Nothing is selected automatically. Choose only details that reflect your current situation, then select Update selected details. You can dismiss the window or select Keep simulation only; your simulation remains saved and your profile is unchanged.

Names, dates of birth, household status, budgets and account balances are not updated by this review; edit those records in Fact Find. Modelling assumptions stay with the simulation. If your profile has changed in another tab, refresh the review and select your changes again before saving them.