Tips For Borrowing Responsibly During Festivals
Festive spending can strain your finances. Learn smart tips to borrow responsibly during festivals without falling into debt or affecting your financial health.
The majority of individuals in India borrow loans during the festive season. Here are some tips to help you borrow responsibly during festivals. You should prepare a budget and research various loan options to determine the best fit for your needs. Avoid high-interest loans and opt for festival loan offers instead.
Introduction
Festival season has arrived in India. You will find offers and discounts everywhere. This is the time when there is an increase in the expenses of an individual in India. To manage these expenses, you can borrow loans. This will help you to enjoy the festival without affecting your pocket.
But it’s also advisable to borrow responsibly. Because if you haven’t planned well for your finances, then it puts added pressure on you and disturbs your financial situation. In this blog, we will study about borrowing responsibly during festivals.
8 Tips to Borrow Responsibly During Festivals
There are many rituals and ceremonies that need to be followed in India during festivals. People share gifts, do pooja, and prepare good food. This increases the expenses and tempts people to go for a loan. Here are a few tips for borrowing responsibly during festivals: -
1. Prepare a Budget
Firstly, decide on your necessary expenses during the festival, like gifts, travel, home improvements, etc. Then decide on a proper budget that can cover all these expenses. Now, ensure that you stick to your budget and follow it rigorously. This will help you do festival shopping on a budget.
This will also control a lot of your expenses. Now you can opt for a loan for only the amount that is necessary. A proper budget will help you avoid borrowing more than required.
2. Research Loan Options
There are many lenders in the market offering loans during the festive season. Research properly about various loan offers. Don’t just rush to the first offer you find. Compare various loan offers. This will help you in finding the best loan offer with better interest and terms.
Avoid chasing attractive loan schemes. Do review the loan contract to understand the costs involved. By researching various loan options, you can get the best deal, which will reduce your borrowing cost.
3. Avoid High-Interest Loans
One of the best tips for managing festival finances is to avoid high-interest loans. There are various loan options available in the market. You should opt for the one that offers low interest loans.
Don’t be in a hurry and opt for a high-interest loan. This will increase your borrowing and make you fall into huge debt. As a result, it will consume all your savings and affect your financial health.
4. Understand Your Borrowing Capacity
If you urge borrowing responsibly during festivals, then you need to understand your borrowing capacity. You should take care that your loan repayments are aligned with your monthly income and expenses. Your loan EMI should not go beyond 30-40% of your disposable income.
This will help you to make EMI payments at ease and avoid any financial strain. If you go beyond your borrowing capacity, you will face difficulty in repaying the loan. This will lead to EMI bounce and hence affect your credit score and affect financial health.
5. Go for Festive Loan Offers
During the festive season, many banks and lenders come up with various offers. This includes zero processing fees and low interest rates. Go for these options and take advantage. This will reduce your loan burden.
In addition to this, even branded companies bring various offers during the festive season. Check for these offers and buy products accordingly. This will save your money and help you maintain financial stability.
6. Make Timely Repayments
You should have proper discipline in loan repayments. A proper, strict plan is required so that you don’t exhaust all your savings. Set up automatic payments or reminders to avoid any missed due dates.
You can also opt for loans with flexible repayment options. This will help you to pay off loans faster, and that too without paying extra fees.
7. Consider Short-Term Loans
You have the freedom to choose your loan tenure. Hence, opt for loans with shorter tenures. This will help you reduce your total interest paid. Loans with longer tenures add more interest.
8. Avoid Last Minute Borrowing
You should always plan for loans in advance during the festive season. Always avoid last-minute borrowing. This will disrupt your entire budget planning. Moreover, devising a repayment plan for the last-minute loan can take much time.
Conclusion
Festivals bring joy and happiness to your life. It should not create financial stress for you. You may feel tempted to borrow loans during the festive season to fulfil the needs of rituals and gifts. But it’s necessary to keep a good balance between emotions and finances. Borrowing responsibly during festivals will help you enjoy the festival even after the lights and decorations disappear.
By creating a proper budget, comparing loan options and avoiding unnecessary debt, one can celebrate festivals without any regrets. Always remember that a loan should be your helping hand and not a financial burden.
Disclaimer: This is a sponsored article. ABP Network Pvt. Ltd. and/or ABP Live does not in any manner whatsoever endorse/subscribe to the contents of this article and/or views expressed herein. Reader discretion is advised.
