Debt Recycling Series Chapter 1 : What is Debt Recycling & How Does It Work?
How I Used My Mortgage to Build Wealth and Unlock Tax Benefits
Debt recycling is a strategy that transformed my finances—it helped me grow my net worth by $450K in just 1.5 years. In this chapter, I’ll take you through what debt recycling is, how it works, and why I don’t pay off my mortgage or use an offset account against my home loan.
⚠️ Disclaimer ⚠️
This content is for educational purposes only and does not constitute financial advice. The examples provided are hypothetical and based on assumptions. Your financial situation and results may differ. Debt recycling involves risks, including market volatility and changes in interest rates. This content does not recommend or promote any specific financial product or service. Always consult with a licensed financial advisor, tax professional, or mortgage broker to ensure this strategy aligns with your personal circumstances.
What is Debt Recycling?
Debt recycling is a strategy that allows you to turn part of your home loan into an investment loan. It works by changing the purpose of a portion of your home loan—from personal use (e.g., buying your home) to investment use (e.g., purchasing shares, ETFs, or other income-generating assets).
In simple terms, it converts “bad” debt into “good” debt. Here’s why: