Tuesday, 26 June 2012

Many of us have limited incomes, but we desire to possess many things. One option is to go in for regular savings and buy the required item only when sufficient funds are available.  But this requires time and we are unable to make use of the item from the time we wanted it. Otherwise we have to go in for a loan. There are many types of loans for different requirements, with different conditions for their granting and repayment. Of course the total amount paid over a period of time after including the interest is substantially higher than the original amount. Getting a loan is easy but still not so easy. We have to assess the total amount of funds required, time when required and our capacity to return the amount in installments, over an agreed period of time. Then we have to decide the agency for taking the loan, make a formal application in prescribed format along with copies of the required documents. Then we should make necessary arrangements to pay the installments as fixed earlier and not fail under any circumstances. But once this habit of taking loans is started, there is an apprehension that it will continue for purchasing one item after another, instead of limiting our requirements of materialistic goods. Sometimes we are forced to take another loan to pay for the installments of the loan already taken. This becomes a vicious circle. Therefore we should think a second time as to whether we really need the item, can we purchase it later with our own savings or should we really go in for the loan at this stage. This will safeguard our expenditures, control and reduce our overall tensions.

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