Home Loan EMI and Mutual Fund SIP!
Which one is better home loan EMI and mutual fund SIP! Is it save your money?
See how a SIP works more for you than an EMI?
It is an open fact that homes are generally bought on finance from banks and housing finance companies charging an interest rate. Customers, in turn, pay the applicable EMIs for the loan they avail from the financial institution.
Buying a house means long-term commitment by way of EMI. The EMI amount is not small by any means. We are willing to take a 15-year loan and pay our huge EMIs diligently, and ensure that we never miss a payment.
- What if we tell you that you can make the interest charged on home loans for free!!
- Yes. The easiest and simplest way is investing in systematic investment plan (SIPs).
A systematic investment plan in mutual funds works more for you than an EMI… Instead of paying Rs 32,238 as EMI, invest Rs 22,238 in MFs and pay Rs 10,000 as rent. You would have accumulated Rs 3.71 crore after 15 years as against a home that would have cost you Rs 58 lakh and would yield Rs 2.32 crore if it grows four times,”
Ask Mutual Funds: Can I repay my home loan with SIP investments?
To complete your home loan you should increase your SIP by Rs 5,000 per month in a balanced fund . All SIP should continue for 10 years to repay your home loan.
Let’s have a look on an example :
So, what about this?
- One, if you showed the patience and ability to commit high sums for a long period of time, like you do with your EMI, you would be able to build a far superior corpus for your long-term goals.
- Two, you need not be in a hurry to take a loan and buy a house in your initial years of high saving.
Detailed Information : Watch Video