Help in deciding prepaymnent of loan

POSTED BY manikambh ON January 26, 2014 10:54 pm COMMENTS (6)

hi am a software proffessional with 50k per month salary. I have three loans

Car loan 8813

Personal loans 8262 and 7750

Loans are approx 25k and monthly expenses are 20000. Till now i got no own house, no health insurance or term insurance, no emergency fund saving. …. Nothing 🙁

In march 2014 one personal loan 8262 one is closing, i am thinking to pay off that amount in car loan.. Car loan will be closed in may 2015, if i pay more for car loan then it can finish off in atleast nov 2014. That way ill be free with 16 k from  nov onwards and can do some investments. Is my thinking ok or do i have to build some fund from march instead of prepaying car loan.

Also am not bankrupted is because my wife earns 13k and she did some rd and we have 50k in cash parked in her savings account. By the way i am 30 years old.

Please advise.

6 replies on this article “Help in deciding prepaymnent of loan”

  1. ashalanshu says:

    Dear Mani, you can park your saved EMI (after closure of 1 PL) into a RD or liquid fund and may opt to close the 2nd PL once you have enough money with you.



  2. ashalanshu says:

    Dear Manikambh, please put your resources to pay back the 2nd PL also before Car loan. Paying back 17% is always better than 10.5% loan.



    1. manikambh says:

      Can we pay the PL in parts, I think they accept only lumpsum payments for the closure of the loan.

  3. rahul123 says:

    1. You are paying car loan with reasonable rate of interest, no need to prepay it. Just keep on paying regular EMI.

    2. Personal loan @ 17% is very painful. You have reasonable amount of money for emergency (50k), no need to touch it.

    3. You can stop contributing to RD, use that money for prepayment of personal loan.


  4. rahul123 says:


    Can you please give more information-

    1.Outstanding Loan Amount (for personal loans and car loans)
    2. Rate of interest charged by lender.
    3. Other savings (gold, if any LIC policy etc)


    1. manikambh says:

      Car Loan
      140454 … more 17 months .. 10.5 %

      Personal Loan
      more 184000 .. more 24 months 17 %

      No Golds…recently taken INGVYSA whole new fullfilling life plan … yearly 24 K …every 4 years ill get 48000 back, i have to pay till 16 years and ill be covered till 85 and ill get 2,40,000 and bonus. I read some articles in this website and decided to stop this policy.

      Kindly advise.

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