7 Golden Rules for Borrowing
A little debt won’t hurt you, thats how the borrowing habit starts.
If everyone has enough money for all their needs, then borrowing is not required at all, but we don’t live in an ideal world. Borrowing becomes compulsive when we have huge aspirations, impulsive spending and peer pressure.
When banks, NBFC’s offers easy borrowing, loan offers, quick disbursals and easy processes, consumers are always lured. But keep these pointers in your mind when you are about access loans.
- Borrow less when you buy depreciating assets with loan ( Car EMI can be 15% and Personal Loan EMI Can be at 10% of your monthly earning – Never exceed this )
- Never borrow more than you can repay
- Keep the tenure as short as possible ( Remember – In long term EMI – The interest outgo is very high )
- Ensure timely and regular repayment ( As Irregular payment affects your CIBIL Score )
- Don’t borrow to splurge or for investment plans
- Read the fine prints for charges and loads on prepayment and other conditions
- Take insurance with high ticket loans ( Like home loans )
For most of the people, Borrowing is more of a habit than needs. Debt costs money, even in impulsive credit card spending too.
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