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07 OCTOBER, 2022
Financial planning is a crucial aspect of life, particularly when you have various expenditures like rent or utility bills to manage. However, unanticipated events cannot always be planned. Such events usually require additional funds. Here’s where personal loans come in handy. Besides providing instant funds, personal loans can also help consolidate multiple debts and Equated Monthly Instalment (EMI) payments into one. But before you click on the ‘personal loan apply’ option on the lender’s website, ensure to plan out your borrowing using an online personal loan EMI calculator to avoid the chances of default later and manage your finances in a better way.
Read on to be aware of how a personal loan EMI calculator can assist you to optimise your personal loan better.
When you have multiple credit card bills and EMIs to pay, tracking them can be a stressful job. There are chances you may miss out on one or two repayments, which may incur penalties and be costly. You can manage such multiple pending payments by consolidating them. A personal loan comes across as a smart solution because it permits you to repay your existing dues in their entirety and make just a single payment every month. You can use an online personal loan EMI calculator to get a thorough break up of your personal loan EMI. Based on your income and budget, you can make changes to the added variables on the EMI calculator and derive the preferred result that is manageable for you.
An EMI calculator even grants access to an amortisation schedule, which assists you to compute the details of your personal loan repayment timeline. The schedule contains principal and interest outgo details post every EMI. This information can help you when budgeting and at times when you are looking to opt for partial prepayment. This data can allow you to identify the perfect time to make prepayment and save the interest constituent.
Personal loan interest rates are the major parameter impacting your personal loan EMI. This interest rate dictates your borrowing cost and differs with every lender. The higher the personal loan rate, the higher the borrowing cost. Likewise, your personal loan EMI is even impacted by your repayment tenure and loan amount. Using an online personal loan calculator, you can compute your EMI depending on such parameters. When you use the online calculator, you can adjust and tweak the variables like loan amount, interest rate, and tenure to fetch the most affordable EMI as per your profile.
As stated previously, your EMI is impacted by your tenure. With the online personal loan EMI calculator, you can compute your EMI outgo for distinct loan tenures. If you are looking for an affordable EMI, go for a longer repayment tenure. Note that doing so even increases your overall interest outgo. Alternatively, if you are looking to reduce your interest burden, opt for a shorter repayment tenure. Do keep in mind, however, that while your overall interest outgo will be lower here, your EMI will be higher. Thus, always ensure to opt for a suitable loan repayment tenure as this gives you the financial breathing room required to manage your repayments with ease.
Proper personal loan EMI planning not just lowers your chances of defaulting on the loan in the future, but also helps you to manage your finances with ease. However, proper EMI planning is not enough, you must also ensure to choose the correct lender to make the most of the personal loan. Zeroing in on the right lender allows you to attain an optimal loan amount at a low interest rate and other favourable loan terms.
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