There was a time when money was scarce and when you fell short of money, you would ask family and friends for financial help. Loans otherwise meant going to the village landlord/moneylender who charged high interests often. Most of the people of those times were therefore careful with money. They would spend only on basic needs and a bit luxury while put away a major part of their money towards savings.
Today, with the advent of easy availability of loans and cards and online payment methods, things have reversed. More and more people now find themselves in more debt but fewer savings. Debt deprives us of many things in life such as peace, joy, fulfilling financial goals, etc. Get rid of debt now.
Don’t let EMIs harm your finances
Never take loans until you’re confident of paying EMI’s without hurting your finances. It is better to avoid taking loans unless you have no other alternative. Compare different EMI’s and lenders and select pocket friendly EMI’s. You can estimate your borrowing capacity by seeing how much money you’re left with after meeting your regular expenses such as savings, investments and taxes. Your EMI payments affect your credit score.
Select a flexible term and ensure there isn’t pressure to pay high EMI’s. Understand that your repayment capacity will rise if there is a rise in your income and vice versa. Upon knowing that you are struggling to pay EMI’s, ask your lender to increase your tenure to reduce EMI burden. Smart Financial Adviser Kuber Mindz says that paying EMI’s should not cost you your financial security. Continue investing for your financial goals.
If you take a huge loan you must have an adequate insurance cover to protect you from possible risks that can negatively impact your loan repayment capacity if uncovered. If you have a Term Insurance and have taken a loan, in case something happens to you, the Insurance Company will pay the EMI’s instead of your bereaved family.
Switch to reduce burden
Interest rates may not remain constant for the tenure so try reducing your EMI load by switching the loan to another lender. Have an understanding about when and where to alter to benefit the most and what other perks and quirks are there.
Managing multiple loans together is hard. Consolidation is better. Think out of the box regarding ways to consolidate your debt.
For more information visit www.moneymindz.com or give a missed call to 022-62116588.