Hi
My age is 40, married and have girl child and I recently built a small house borrowing 30lks from CAN FIN PVT LTD. I don't have any investment because my salary on hand is only 50k, monthly EMI goes around 27k and balance amount will be spent on school fees, home allowance and personal allowance
Is there any way to get this loan closed ASAP pls advise the ways
Ans: You are 40 years old, married, with a daughter, and a new home loan.
Your current monthly income is Rs 50,000, and you are repaying an EMI of Rs 27,000.
That means over 50% of your income goes to EMI. This is considered financially stressful.
Let us explore practical and sustainable options to close this loan faster.
We will also ensure your basic expenses and child's future are not compromised.
Review the Current Expense Structure
First, we need clarity on your monthly cash flow.
Break your expenses into these parts:
Home EMI – Already known: Rs 27,000
School Fees – Check if it's term-based or monthly
Household Expenses – Food, electricity, groceries, etc.
Personal Expenses – Clothing, mobile, transport, health, etc.
Miscellaneous – Annual insurance, festivals, travel
Prepare a simple budget.
This gives clarity on which costs are fixed and which can be controlled.
Without this clarity, you may feel stuck every month.
Downsize Household Lifestyle Temporarily
Until the loan is repaid, live with a frugal mindset.
Consider the following cost control ideas:
Reduce dine-out frequency or shift to simple meals
Cancel unnecessary OTT, internet, or mobile data packs
Repair items before replacing them
Reuse children’s books, clothes, and stationery from friends
Postpone festivals, gadgets, or lifestyle expenses
Saving even Rs 3,000 to Rs 5,000 per month can create a big difference.
Use this amount towards extra EMI or loan principal.
Increase Income Without Changing Jobs
You may feel salary is not enough. But don’t rush for job switch now.
Explore small parallel income options:
Weekend tutoring – Class 5–10 subjects or spoken English
Freelancing – Data entry, writing, social media posting
Insurance/MF distribution – Start part-time with CFP guidance
Evening sales at home – Snacks, tailoring, tuition, etc.
Even Rs 5,000 to Rs 7,000 per month from side hustle helps.
Use the entire extra income to repay the loan faster.
Restructure the Loan with Longer Tenure
Currently, your EMI eats up 54% of your salary.
Approach your lender and ask for a longer tenure.
By increasing tenure, EMI can reduce.
This gives breathing room in the monthly budget.
Later, when your income grows, you can make part-payments.
Check if CAN FIN charges a penalty for prepayment.
Most NBFCs do not charge penalty for own-sourced loans.
Explore Balance Transfer to Public Sector Banks
CAN FIN is a private NBFC.
Their interest rates are often higher than PSU banks.
Apply for balance transfer to a public sector bank.
Benefits you can expect:
Lower interest rate
Waiver of processing fee in special offers
Longer repayment tenure options
EMI reduction even without income change
You need a good credit score (above 700) for this.
Also, maintain regular EMI history for approval.
Once transferred, keep making small extra payments.
This alone can reduce loan closure time by 2–4 years.
Utilise One-Time Income Wisely
Any lump sum amount must be redirected towards loan:
Annual bonus
Maturity of old insurance
Sale of unused gold or bike
Parental gift or inheritance
Avoid spending it for lifestyle needs.
Use this windfall to directly reduce principal.
This gives long-term relief from interest payments.
Avoid New Loans and Commitments
No matter how tempting it looks, don’t go for new EMIs.
Avoid credit card usage unless paid in full every month.
Don’t take personal loans for weddings, vehicles, or holidays.
You are already financially over-leveraged.
Focus only on loan closure for next few years.
Build patience and prioritise financial freedom.
Create Emergency Fund Gradually
Many families face loan default due to lack of backup.
Start saving Rs 500 to Rs 1,000 monthly in liquid fund.
Once it becomes Rs 10,000 to Rs 20,000, use only in emergencies.
This ensures you never miss EMI due to sudden expenses.
No need for big savings now. Small buffer is enough.
Emergency fund avoids panic and protects credit score.
Avoid Direct Plans and DIY Investing
Once loan burden reduces, you may consider investments.
Never invest in direct plans or online without guidance.
Disadvantages of direct plans:
No one advises you in bad markets
You will miss goal-based portfolio rebalancing
Tax planning, withdrawals, and retirement planning will be scattered
Risk of emotional exits in market downturns
Instead, prefer regular mutual funds through a CFP and MFD.
You will receive structured advice, emotional support, and goal tracking.
A Certified Financial Planner will ensure you don’t repeat loan stress again.
Surrender Old Insurance-Cum-Investment if Any
You have not mentioned any ULIP or LIC policy.
If you hold any such plan, please surrender immediately.
They offer poor returns and lock your money.
Redirect that money to repay your home loan.
Later, invest in mutual funds through a CFP.
Keep pure term insurance for protection.
Don’t Try to Invest Now
Avoid investing until loan EMI is below 30% of your income.
Currently, any mutual fund or RD will only delay your freedom.
You are better off clearing the home loan first.
Pay extra towards principal in small chunks.
Invest only when your cash flow improves.
Build Long-Term Financial Discipline
After loan closure, don’t let expenses rise suddenly.
Convert EMI habit into SIPs and emergency funds.
Build the following from age 42 onwards:
Rs 15,000 SIP in diversified mutual funds
Rs 1 lakh liquid emergency fund
Rs 5 lakh in term insurance (if not already covered)
Child education fund
Retirement goal fund
These will ensure you never borrow again in future.
Loan freedom gives peace of mind and mental space.
Check if Spouse Can Support Financially
If your wife is available, explore part-time work or tuition.
Even Rs 3,000 monthly from spouse helps a lot.
Create a common family financial goal.
This builds unity and reduces financial anxiety.
Avoid blaming each other for income gaps.
Focus on what you can control as a couple.
Protect Your Health and Income
Ensure you have at least Rs 5 lakh family floater health insurance.
Also take critical illness cover if affordable.
One hospitalisation can destroy your budget.
Protect your income and avoid medical loans.
Don’t rely on employer cover alone.
Buy a personal health policy for long-term security.
Final Insights
You are already owning a house, which is a big milestone.
Loan stress is temporary, but discipline must be permanent.
Focus now should be on:
Reducing EMI burden through tenure or interest
Increasing income through second source
Controlling lifestyle for next few years
Making part-payments using surplus or windfalls
Planning future investments through a Certified Financial Planner
A home loan is a long-term commitment.
But your financial freedom can arrive sooner with the right plan.
You have shown courage by reaching out.
Now convert this awareness into regular action every month.
You will be debt-free and peaceful before you turn 50.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment
Question by Amit on Jun 15, 2024Hindi
