Planning to take a personal loan for Diwali shopping? Make note of these 5 points first

If you are planning to celebrate Diwali with a lot of fervour and may fall short of money, then you may consider raising a loan from a bank or NBFC.

With instant loans available at the tap of your phone or click of a mouse, there are plenty of options to go around. Whether it is to buy an expensive gift for a host of clients or to get some repairs done at your house, you may need urgent funds during the ongoing festive season.

However, before you decide to go for it, you must consider the following points carefully.

Personal loan: Consider these points beforehand

I. Urgent or discretionary: First of all, you must make sure that the expense is urgent and not discretionary. For instance, getting house repaired may be urgent renovation could be discretionary.

II. High interest rate: Being unsecured, personal loans carry high interest rates. Therefore, it is recommended to compare different lenders before you opt for a loan.

III. Financial goals: Another factor that you must consider is that this loan should not lead to compromising your financial goals. If you were planning to borrow loan two months later to buy a new car, then perhaps you would not want to take additional liability at this stage.

IV. Save for the time being: There could be another scenario wherein you can save money for a few months to meet the expense which you are planning to incur during Diwali. It could be a house repair or something else.

V. Arrange for the shortfall: Alternatively, you could raise a small loan which you can easily repay in the next say – six months.

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