Hi Sir, I lost job in 2017 and again I got a new job after 6 months. During this 6 months i lost all my savings including PF. So in last 5 yrs what ever I am earning it's not sufficient and my expenditure is more than salary. Meantime I started taking small small personal loans from app companies and my both my credit card is fully utilised This is my current situation. Salary is 1.66 lacs. Savings is 50,000. My loans are 1.2 lacs. Credit card Os is Rs 4 lacs. If I close personal loan then I am using credit card, if I pay credit card then I taking loan again. I don't know how to come out of this cycle. Pls suggest.

Ans: You must stop taking new loans immediately and reduce unnecessary expenditures. Use the Rs 15 lakh in hand to partially repay high-interest loans and secure yourself financially. Seek confidential guidance from a Certified Financial Planner to create a structured debt repayment plan. Your life is more valuable than any financial status.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment

Ans: Your concern is valid and very real.

You are 32 years old.

You earn Rs 30,000 monthly.

You have borrowed heavily from acquaintances.

You also hold three personal loans.

You are stuck in a debt loop.

You want a practical and long-term solution.

Let us now give you a detailed 360-degree strategy.

Understanding the Complete Debt Picture
Rs 15 lakhs loan from acquaintance, paying Rs 45,000 monthly interest

Rs 4.5 lakhs from another friend, paying Rs 38,000 monthly interest

Personal loans: Rs 1.7L, Rs 2.5L and Rs 1L

EMI on personal loans: Rs 8,000 + Rs 6,000 + Rs 6,000 = Rs 20,000

Total monthly outgo on debt: Rs 1,03,000

Your income is only Rs 30,000

You are in deep negative cash flow every month

You are likely borrowing more to pay interest and EMIs

There are no assets, savings, or investments right now

Appreciating Your Decision to Seek Help
You have taken a bold first step.

You have recognised the problem clearly.

You want to stop the debt cycle.

That shows willingness to act and change.

This mindset will help you come out of this.

Let's now move step by step.

Step 1: Stop Borrowing Further, Even for a Day
No more loans from anyone, under any situation

Stop all app-based loans completely

Inform friends that you cannot borrow more

Every new loan worsens the trap

Any money borrowed now will increase your pain

Accept this truth today and stay strong on it

Step 2: Understand That You Cannot Continue Like This
You are paying Rs 1.03 lakhs interest and EMI

Your income is Rs 30,000

This math can never work

You are surviving through borrowed time and favours

You are in a debt trap right now

It will not go away on its own

You must act boldly and wisely

Step 3: Discuss a Structured Debt Settlement with Lenders
First, talk to the friend who gave Rs 15 lakhs

Show him your situation openly

Request to stop monthly interest for some time

Offer to pay a fixed EMI instead of interest

Do not avoid or delay conversations

People respect honesty and intention to repay

Next, approach the friend who gave Rs 4.5 lakhs

Follow the same approach

Suggest converting monthly interest into a longer-term EMI

Offer a token amount monthly

Rework the payment terms to suit your capacity

Involve a family elder if it helps build trust

Step 4: Consolidate All Personal Loans If Possible
Check if you can get a single loan to close all personal loans

Target is to reduce EMI burden

You may not get loan from bank due to low credit

Try to get help from a family member to get a low-interest personal loan in their name

Only to consolidate existing EMIs, not new borrowing

If this is not possible, maintain current EMIs

Prioritise loans with highest interest

Keep communication open with lenders

Avoid missing EMIs to protect your credit score

Step 5: Cut All Possible Expenses Immediately
Stop non-essential expenses like:

  - OTT subscriptions
  - Dining out
  - Online shopping
  - Gym expenses if you can self-train
  - Fuel and travel which can be avoided

Shift to a more affordable living setup if needed

Speak to landlord to reduce rent temporarily

Share accommodation if possible

Buy basic groceries only, no luxury items

Use cash to control daily expenses

Maintain a diary of every rupee spent

Step 6: Increase Income with Secondary Work
You said fitness jobs limit income

But look for add-on work during free time

Some ideas:

  - Online fitness coaching from home
  - Recording videos for online classes
  - Selling fitness guides or diet plans
  - Helping with social media content for fitness brands
  - Freelance training for apartment gyms

Aim for Rs 5,000–Rs 10,000 extra monthly

Every bit of income helps reduce debt burden

Use these earnings strictly to pay back lenders

Step 7: Avoid Any Investment Till All Loans Are Closed
No SIP, no stocks, no mutual funds now

Do not fall for quick return promises

You are in debt repayment phase

Investment can come later, not now

Keep focus only on clearing loans

Step 8: Seek Free Counselling If Emotionally Drained
Debt creates mental pressure

It may cause anxiety or fear

Speak to someone who listens, not judges

Use free helplines or NGOs offering support

Don’t suffer alone silently

Keep your mind strong and focused

This is a temporary phase, not permanent

Your future can change with effort

Step 9: Once Stable, Start Emergency Fund Slowly
After you clear high-interest debts

Start saving Rs 500–Rs 1000 monthly

Put in liquid mutual fund via regular plan

Avoid direct plans – they offer no guidance

Certified Financial Planner can guide better

Use emergency fund only for urgent needs

Never use for shopping or travel

Keep building it month by month

Step 10: Finally Build a New Financial Identity
Clear your loans step by step

Rebuild your credit slowly

Start tracking income and spending every month

Stay away from lending apps permanently

Create small savings habit after debts are over

Start SIP with Rs 1000 in regular equity fund when possible

Review goals with Certified Financial Planner yearly

Learn to say ‘No’ to money offers when not needed

Finally
You are in a serious but solvable financial crisis

Accept it, face it and work on it

Stop new borrowing right now

Restructure old debts with honesty and clarity

Cut lifestyle expenses sharply

Create new income channels in fitness or beyond

Don't try to invest until debts are closed

Once stable, build emergency and investment habit

Use mutual funds with regular plan and guided help

Stay away from index and direct funds for now

This problem is hard but not permanent

With small steps and strong action, you can come out

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment

Ans: Acknowledging the problem is the first big step.
Now let’s work on a clear, step-by-step recovery plan.
You can definitely come out of this situation.
Let’s take a 360-degree approach to your finances.

Understanding Your Present Situation
Your age: 38 years

Monthly salary: Rs 46,000

Wife’s contribution: Rs 15,000 monthly

Combined income: Rs 61,000 monthly

Personal loan burden: Rs 11,47,000

Credit cards active: Two with Rs 40,000 combined limit

Credit card cancelled: HDFC Regalia of Rs 2 lakh limit

Emergency fund: Rs 2 lakh in savings

Job switch and upskilling: Actively exploring

You are under financial pressure due to loan EMIs.
But you have stable income and support from spouse.
You also have Rs 2 lakh as a safety net.
You have started taking action, which is very important.

Step-by-Step Actions to Fix the Situation
1. Assess Your Loan EMI Structure Clearly

Find the interest rate and tenure of your personal loan

Check your exact EMI amount and the number of EMIs pending

Don’t miss a single EMI – protect your credit score

Avoid increasing EMI just to close early – it may hurt cash flow

Don't take a top-up or consolidate using credit card – risky move

If possible, speak with the lender and check:

Is there a lower interest loan balance transfer available?

Can the tenure be extended slightly to reduce EMI?

Can you part pre-pay using Rs 2 lakh in savings later?

Keep in mind: Safety net must be preserved till things improve
Use prepayment only if your income becomes stable

2. Control and Monitor All Household Expenses

Create a monthly budget for your household

Prioritise essentials – food, rent, utilities, children’s needs

Stop all luxury or non-essential spending temporarily

Avoid online shopping and impulse buys

Don’t use credit cards for new expenses

Avoid EMI-based purchases

Track expenses using an app or notebook.
If possible, reduce your monthly lifestyle cost by 15–20%

Use wife’s Rs 15,000 monthly only for planned expenses
Keep your income primarily for loan repayment

3. Stop All New Investments or SIPs Temporarily

At this stage, no SIPs or fresh investments needed
Focus 100% on debt repayment and emergency corpus

Pause all investment activity
Restart only when loan EMI is manageable

4. Build a Simple Emergency Buffer

You already have Rs 2 lakh in savings
Keep Rs 1 lakh in a liquid mutual fund or savings account
Keep Rs 1 lakh in sweep-in FD or ultra short fund

This should only be used if:

There is a health emergency

You lose your job

Unexpected family crisis

Don’t use this for EMI or regular spending

5. Stay Away from Credit Cards for Now

You have two cards with Rs 40,000 limit
Do not use them unless it’s an emergency

Don’t carry any outstanding balance
Pay entire bill before due date
Avoid using credit cards for EMI or cash withdrawal

Do not apply for new credit cards
That increases your credit enquiry and reduces your score

Use debit card for all regular spends

6. Plan a Structured Prepayment Strategy

Once you increase income or get a bonus, follow this order:

Prepay 10–15% of loan principal every 6 months

This will reduce total interest paid

Don’t touch emergency fund unless absolutely safe to do so

Keep track of reducing principal after each prepayment

Try to close personal loan in 2.5–3.5 years
Don’t aim for faster closure unless income improves
Maintain balance between mental peace and financial burden

7. Income Growth Is the Real Solution

You mentioned you're looking for better job
That is very important now

Focus areas:

Upgrade skills in your domain

Take short-term certifications (affordable ones)

Build resume, network actively, use LinkedIn

Join online webinars and hiring platforms

Explore weekend freelancing if skilled in writing, editing, etc.

Even a 20–30% jump in salary will make things easy
Don't delay this – start today

Once income increases:

Increase prepayments

Start fresh SIPs of Rs 1,000–2,000

Build investment portfolio slowly again

8. Don't Consider Index Funds or Direct Plans Later

Once you start investing again, avoid index funds
They don’t protect in down markets
No human judgment in allocation
They fall fully with the market

Actively managed mutual funds are better
They give better returns through strategy
They handle volatility more smartly

Also, avoid direct plans in future
They look cheaper but have major issues:

No expert support or advice

No goal mapping

No exit strategy

No emotional guidance during market fall

Use regular plans via Certified Financial Planner and MFD
They give structure, planning, review, and support

9. Think Mental Health Also

You may feel regret and pressure
That’s natural – you are human

Speak to someone if stress builds up
Stay positive and take one step at a time
Do not compare with others
You are already on the right path

Keep your partner in the loop
Work as a team – not alone

Finally
You made some mistakes, but you are already correcting them
You have income, support, and a small cushion
Avoid new debt and focus on repaying current loan
Stop credit card use and luxury expenses
Upgrade skills and change job as soon as possible
Rebuild investments once loan is handled
Avoid index and direct mutual funds later
Invest via CFP and stay consistent

This phase will pass
Take control with small daily steps
Your future can still be very bright

Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment

Ans: Understanding Your Current Situation
– You are 36 years old
– Your monthly income is now Rs. 37,000
– Expenses for food and rent come to Rs. 20,000
– That leaves Rs. 17,000 before any loan payments

– You have gold loans worth Rs. 5.5 lakh
– You have multiple personal loans totalling Rs. 4.8 lakh
– So total outstanding loan is nearly Rs. 10.3 lakh

– For past 5 months, you are unable to pay some EMIs
– Your savings have been wiped out due to stock trading losses

– You are newly married and have a dependent spouse
– Emotional stress is very natural in this phase
– But please know, this is a temporary phase

– With structured steps, you can recover

First Steps You Must Take Now
– Do not panic or feel alone
– Financial struggles happen to many, recovery is always possible

– Stop any form of stock market activity
– Do not trade or invest until your debt is cleared

– Make your spouse aware of the situation
– Transparency will reduce pressure on you

– Write down all your loans with amount, lender name, and EMI amount
– Prioritise loans with high interest or legal risk

– App-based loans often charge high interest and penalties
– These can grow fast if not handled on time

– Keep all communication with these app lenders in writing
– Always email them or talk through the official app chat
– Do not speak with recovery agents unofficially or under pressure

Segregate Loans by Nature
Gold Loan
– Amount: Rs. 5.5 lakh
– It is secured loan. Your gold is the collateral
– This should be prioritised after legal loans

– Try not to default for long, or you may lose the pledged gold

– But this can be handled slightly later than app loans

Personal Loans through Banks/NBFC
– Rs. 2.3 lakh loan with 3.5 years left
– Plus other loans of Rs. 1.7 lakh and Rs. 40,000 each

– Bank/NBFC loans are structured and regulated
– Speak with these lenders and request restructuring or settlement

– Show proof of income drop and recent marriage
– Some may allow EMI deferment or lower EMI

– Avoid taking new loans to repay these

App-Based Loans
– These loans usually carry very high rates
– They may harass you with calls and messages

– Email their customer care and request a one-time settlement
– Explain that your income is limited and you are willing to pay in parts

– Take screenshots of your emails or chats for record
– Do not accept verbal promises

– If they threaten or misuse your contact list, you can file a police complaint
– Harassment by digital lenders is now punishable

Restructure or Close Loans One by One
– Focus on settling one loan at a time
– Start with smallest or high-stress app loans
– Even if you save Rs. 3,000/month, you can close small loans in time

– Request one-time settlements for overdue loans
– Start repaying once they agree on reduced amount

– Gold loan should be addressed once unsecured loans are under control
– You can also ask gold loan provider for EMI-based repayment option

– If possible, borrow interest-free from family to close any one loan
– But do not borrow again to pay another loan unless it’s zero-interest

Household Budgeting to Create Monthly Surplus
– Right now, you have Rs. 17,000 left after rent and food
– Create a very strict budget for now
– Avoid online purchases, subscriptions, or eating out

– Set aside Rs. 10,000 monthly only for debt
– The rest can be for phone bill, transport, etc.

– Every single rupee should go into priority-based loan repayment
– In next few months, small wins will reduce your mental burden

Increase Income With Temporary Side Income
– Explore freelance, weekend work, or part-time online jobs
– Focus on skill-based extra income like tuition, typing, or delivery apps

– Even Rs. 5,000 extra monthly can fast-track your repayment

– Avoid thinking too long term for now
– Every short-term gain can ease your pressure

Credit Score and Future Access
– Right now, your credit score may be falling due to missed EMIs
– But once you repay or settle even a few loans, it starts improving

– Ask for “No Due Certificate” after each settlement or closure
– Keep all records for future reference

– Do not apply for new loans until existing ones are cleared

– In future, avoid personal loans for non-emergency needs

– Build credit again slowly with secured cards or small EMIs later

Stop All Risky Investments Now
– Do not put money in stocks, trading, or crypto
– You already faced big loss of Rs. 7 lakh
– That must not be repeated again

– Learn from it, but do not feel ashamed
– Take this phase as a valuable financial lesson

– Once stable, build long-term wealth only through proper mutual fund SIPs

– Use regular mutual funds with guidance from Certified Financial Planner

Should You Use Direct Mutual Funds Later?
– Direct funds look cheaper, but they have no personalised help
– No one will guide you during market fall or life changes

– You may stop SIP in panic or invest in wrong category

– Regular mutual funds through a trusted Certified Financial Planner offer help
– They offer timely review, rebalancing, and goal tracking

– That makes the cost worth it and returns more steady

– So when you are ready, choose regular plan over direct

Mental Health and Family Support
– Financial stress also affects health and relationship
– Don’t hide the burden from your spouse or close family

– Explain your step-by-step plan to them
– Their emotional support can strengthen you

– Avoid social media distractions or online offers promising fast loans or trading profits

– Stay grounded, follow the basics, and focus only on clearing one loan at a time

Talk to a Certified Financial Planner
– Once your loan burden is lighter, consult a Certified Financial Planner
– They can create a full plan for your long-term goals
– They also help track expenses, risk, and savings in a realistic way

– This builds discipline and gives clear goals to work toward

– Don’t wait to become rich to seek expert help
– Expert advice early helps recover faster and smarter

Finally
Your situation may feel tough today. But it is not permanent. With patience and right steps, you can come out stronger.

Start with a clear list of loans. Focus on one closure at a time. Do not take new loans. Avoid risk investments. Control expenses. And most importantly, keep mental calm.

Remember, building wealth comes after clearing debt. And financial freedom comes only with peace of mind.

You are already on the right track by asking for help. Keep moving forward.

Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment