4 Tips to Pay Your Personal Loan on Time

In today’s day and age, it has become common for all of us to face a cash crunch from time to time. No matter how well you plan your finances, or budget for all your expenses every month, a few financial hiccups may still arise due to unforeseen expenses. Even then, meeting them is no longer an issue, thanks to the advent of personal loans. Thanks to the sheer convenience they offer in terms of access to short-term funds, a personal loan has become the go-to solution for people who are faced with an emergency. As important as it is to do your homework on how to get a personal loan, it is equally important to pay it off on time. We’ve listed out four ways to make timely repayments for your personal loan. Read on.

1.Never Borrow More Than Necessary

While taking out a personal loan, it is always recommended to only borrow how much you need. Please remember that a loan is still debt at the end of the day and that accumulating debt is never a good idea. The whole point of borrowing a loan is to eliminate your financial woes, not add to them. Borrowing “a little extra, just in case” might sound really appealing at first; but it ultimately means that you end up paying more interest for more debt. Ensure you only borrow the amount you need, based on the specific purpose for which you’re taking the loan.

2.Budget your EMIs

“Spend what is left after saving” – this tip by Warren Buffett, a hugely successful investor, is an incredibly simple way for you to save money in general. However, this is also something you can do in order to pay off your EMIs quickly. Your personal loan EMI will definitely take up a chunk of your net monthly salary. So, it’s a good idea to budget for that, along with the rest of your usual expenses like rent, utilities, and groceries. The idea here is to live on the remainder of your monthly salary, and while that may be hard to do at first, you will at least have the assurance of paying your EMIs on time.

3.Don’t Use Your Credit Card

By taking out a personal loan, you are already putting yourself in debt. Paying off your personal loan EMIs with your credit card is a bad idea because credit card spending is also another form of debt. Ideally, you should only make purchases on your credit card when you are sure of paying back the balance in full by the stipulated date. The same applies to your EMIs. If you can’t pay them off in cash, you should not touch your credit card.

4.Increase Repayments Wherever Possible

There may be times where you may come by a large sum of money, usually in the form of a festival bonus or a hike in your salary. In such a situation, it makes sense for you to increase the payment on your personal loan as much as possible, rather than spend it elsewhere. In doing so, you will repay your loan faster and also save up on interest payments.

Wrap Up

The points we have listed above are a few helpful tips that will go a long way in helping you clear your personal loan on time. If you are on the lookout for a personal loan provider that offers fast and easy access to short-term funds, KreditBee is a good option you can consider. Apart from their easy-to-understand process and the minimal documentation required, their application process is also 100% online. All you need to do is download the app, complete your profile, and leave the rest to us. If you wish to learn more about our personal loans, write to us at [email protected] or simply call +080 44 292 200.