 "Choose the right type of credit this festive season: All you need to know")
1. Purchase of a consumer durable can be done through a wide variety of loan options - personal loan, consumer durable loan, or a top-up home loan.
2. Compare the interest rates of the loan options you are eligible for.
3. A loan of Rs 500,000 taken at 12 per cent for a five-year tenure will result in an interest cost of Rs 167,333.
4. The same loan taken at 8.7 per cent for the same tenure will result in an interest cost of Rs 118,392, a saving of Rs 48,941.
5. Avoid gorging excessively on credit this festive season.
6. The rule of thumb to follow is that your total equated monthly instalment (EMI) on loans should not exceed 40 per cent of your net salary.
7. Unsecured debts should be limited to 10 per cent of net salary.
One subscription. Two world-class reads.
Already subscribed? Log in
Subscribe to read the full story →*Subscribe to Business Standard digital and get complimentary access to The New York Times
Smart Quarterly
₹900
3 Months
₹300/Month
SAVE 25%
Smart Essential
₹2,700
1 Year
₹225/Month
SAVE 46%
*Complimentary New York Times access for the 2nd year will be given after 12 months
Super Saver
₹3,900
2 Years
₹162/Month
Subscribe
Renews automatically, cancel anytime
Here’s what’s included in our digital subscription plans
Exclusive premium stories online
Over 30 premium stories daily, handpicked by our editors
Complimentary Access to The New York Times
News, Games, Cooking, Audio, Wirecutter & The Athletic
Business Standard Epaper
Digital replica of our daily newspaper — with options to read, save, and share
Curated Newsletters
Insights on markets, finance, politics, tech, and more delivered to your inbox
Market Analysis & Investment Insights
In-depth market analysis & insights with access to The Smart Investor
Archives
Repository of articles and publications dating back to 1997
Ad-free Reading
Uninterrupted reading experience with no advertisements
Seamless Access Across All Devices
Access Business Standard across devices — mobile, tablet, or PC, via web or app
SAVE 25%