Pay off Loan Early and Start SIP from the EMI amount

POSTED BY Shreyas ON October 22, 2012 7:01 pm COMMENTS (4)

Hi Team,

I have taken loan of Rs 2,00,000/- from Bank for 5 years and paying Rs 4800 as EMI from last 2 years.

I checked with bank and they said i can pre pay my loan balance of Rs 1,56,000/-

I have Rs 1,00,000 with me. Just wantde to know is it beneficial to pay off loan early and start SIP for 4800.

If yes then in which all SIP should i invest.

Just as an additional information i am 28 year married guy.

4 replies on this article “Pay off Loan Early and Start SIP from the EMI amount”

  1. Dear Shreyas, I assume it’s a Personal Loan, You are already over 2Y in this loan & remaining period is less than 36 months. The ROI is 15.5%. If you can earn more than 15.5% from your 1L Rs. amount, you should invest, else prepayment is a good idea sir ji. 🙂



  2. If I were at your place, I would first clear off this loan as its a small ticket loan , so I would better get it off my head and not having it hanging 🙂 . Also prepay 1 lac now and in some months prepay more and clear it 100% . Then start your SIP if needed .

  3. Shreyas says:

    Thanks Biswa….I have knowledge about SIP and i am already investing in HDFC Top 200 and tax saver SIP from last 2 years….i just wanted to know which SIP’s are better from long term prospective apart from the one i am investing in.

  4. Biswa Singh says:

    Its better not to have loans. If you dont have any knowledge about any of the SIP then you need little bit reading. Please read articles related to mutual funds.

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