The right personal loan can not only help you meet your cash requirements but also achieve the much desired financial stability. Read on to understand the nature of personal loans and how you should avail the right personal loan to be financially stable.
A personal loan is an unsecured form of monetary assistance that serves your financial needs of the moment and comes with easy approval procedure from financial institutions. The lenders do not require any collateral and the personal loan is approved solely on the lender’s repayment ability and credit history. Unlike most loans, the absence of obligatory collateral makes personal loan an unsecured form of debt and gives you individualistic flexibility to manage your finances.
Financial stability is something which many aspire to achieve but very few attain. Financial stability for long has been misunderstood by commoners and has been incorrectly measured by an individual’s income, bank balance or assets. On the contrary, a person with comparatively lower income or bank balance can also be financially stable. Financial pundits talk about the following parameters which you can use to measure your financial stability.
Readiness for Emergencies:
Emergencies can arrive anytime uninformed and can make a significant dent on a person’s savings. Financially prudent people maintain a safety nest of an emergency fund to deal with such exigencies. The ability to easily handle a financial emergency through savings or debt is the first step to be financially stable. If you do not have a sufficient emergency fund, a quick personal loan can help tide over the situation and you can repay the loan amount over easy EMIs. The ability to meet your expenses is a real stress buster.
Credit Card Debt:
People use plastic money because of the inherent ease of credit and wide acceptance it provides. But credit card debt is one of the highest forms of debt and can significantly dent your finances if you’re unable to repay the entire amount every month. Most credit cards have interest rates which are upwards of 30% per annum. It’s not just the high credit card interest rates which should bother you. The outstanding amount on your card account negatively impacts your credit score as well. Rising credit card debt among citizens is a major problem in countries worldwide.
When in need of cash, avail a quick personal loan with a much lower interest rate and easy repayment terms to avoid a vicious debt cycle. You can repay the loan over a longer tenure, unlike credit cards where you need to repay the entire amount in the next billing cycle or incur high finance charges.
No matter what you do, if you’re not happy with your financial state, then you’ll always be stressed. You will always worry about your planned and unplanned expenses and wonder how you will meet them. The only way out is to control your cash outflow by cutting down on unnecessary expenses, costly debts and plan for financial stability.
Aim to keep your debt-to-income ratio under 30% so that you have enough spare cash to meet your planned and unplanned expenses each month. Although most lenders would lend you even at 70% debt-to-income ratio, this situation might put you under necessary financial duress in case you have unplanned expenses. Ensure your loan EMIs and bills are paid first before you spend your monthly income on anything else.
Lifestyle & Luxury:
The modern human being can’t lead a sage’s lifestyle. Apart from the necessary expenses like home rent, clothing, food, utilities etc. everyone indulges in occasional lifestyle expenses like dining out, taking vacations, buying gadgets etc. You need to be able to fund these lifestyle and luxury expenses without breaking your bank. If these expenses worry you then you should set aside a monthly fund to meet these expenses or opt for a financial product designed to help you make such purchases without affecting your financial stability.
A personal loan is a handy financial instrument which can be availed to cover expenses which are personal in nature, without affecting your financial stability. For instance, this loan can be availed to meet wedding expenses, vacation or even for credit card debt consolidation. The most highlighted benefits of such a dynamically beneficial loan product are its nature of easy approval and quick disbursal, while also the convenient tenure, even though these are completely dependent on your lenders’ policies.
The interest rates for personal loans are friendlier than overdrafts, payday loans, credit card, etc as they are prone to charging comparatively higher rates of interest. Even in context to tenure – personal loans offer easy repayment terms.
If you were looking for a personal loan for first time, you’ve come to the right place. At NIRA, we value eyes gleaming aspirations and the urge to grow with financial freedom, which is why we welcome you to experience business with us. Apply for a personal loan online on NIRA website or mobile app and get instant approval and quick disbursal directly to your bank account. We’re here to help you achieve financial freedom and stability.