Forum Topics Debt Recycling
Vandelay
2 years ago

I just read about debt recycling. Does anyone implement this strategy? My understanding is you can redraw against your principal place of residence home loan, use that money to invest and then claim the interest as a tax deduction (on the redraw portion).

Does anyone know if the maths works out beneficial if you keep aggressively paying down the loan and redrawing until the entire home loan interest is a tax deduction? Opposed to just investing your spare money straight away?

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Vandelay
2 years ago

Thanks for the response Trev. Yes I'll definitely be asking my accountant.

I would use the re-draw money to invest in stock (not investment property). I assume it would have to be stocks / etfs that pay a dividend to classify it as an income producing investment to be able to make the ongoing interest payments deductible?

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Vandelay
2 years ago

Thanks @Trev & @Maaxweell

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