Smith Maneuver Calculations
This page provides detailed calculations using a sophisticated Smith Maneuver calculator. The purpose of this page is to provide you with:
- Some of our most popular calculation requests including: (1) Excellent case outcome (2) Moderate case outcome (base case) (3) Poor case outcome/ a ‘stress test’ for break even.
- An idea for how the Smith Manuever operates, and the variables involved.
- How to get a free, personalized calculation by booking an appointment in the calendar below.
Excellent Case Calculation
| Input | Assumption |
|---|---|
| Amortization | 20 YRS |
| Mortgage Rate | 4% |
| Starting Mortgage Balance | $500.000 |
| HELOC Rate | 5% |
| Marginal Tax Rate | 29.65% |
| Return on Investment | 9% |
| RESULT: Tax Savings | $81,423 |
| RESULT: Total Investment Value | $1,114,483 |
| RESULT: Net Profit | $614,483 |
Moderate Case Calculation
| Input | Assumption |
|---|---|
| Amortization | 20 YRS |
| Mortgage Rate | 4.5% |
| Starting Mortgage Balance | $500,000 |
| HELOC Rate | 5.5% |
| Marginal Tax Rate | 29.65% |
| Return on Investment | 6.5% |
| RESULT: Tax Savings | $89,138 |
| RESULT: Total Investment Value | $813,993 |
| RESULT: Net Profit | $313,993 |
Break Even Case Calculation
| Input | Assumption |
|---|---|
| Amortization | 20 YRS |
| Mortgage Rate | 7% |
| Starting Mortgage Balance | $500,000 |
| HELOC Rate | 8% |
| Marginal Tax Rate | 29.65% |
| Return on Investment | 3.2% |
| RESULT: Tax Savings | $126.979 |
| RESULT: Total Investment Value | $501,426 |
| RESULT: Net Profit | $1,426 |
Disclaimer: Past performance does not guarantee future results. The information on this page is for education and illustrative purposes only, and is not intended to be used as, or construed as investment advice. Seek the advice of a licensed investment processional before investing.