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Ramalingam Kalirajan |10902 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on Jul 30, 2025

Ramalingam Kalirajan has over 23 years of experience in mutual funds and financial planning.
He has an MBA in finance from the University of Madras and is a certified financial planner.
He is the director and chief financial planner at Holistic Investment, a Chennai-based firm that offers financial planning and wealth management advice.... more

Question by Thejasvi on Jul 12, 2025Hindi

Sir i m getting 85K salary on hand and i have more loans than my commitment.. I need around 80k every month extra other than the salary.. What is the way i need to come out of these problems

Ans: Thank you for being honest and open. That’s a strong first step. Managing financial pressure needs clarity, planning, and action. You still have control. You can work your way out.

? Assess Your Monthly Cash Flow
– Your take-home salary is Rs.85,000.
– You need Rs.80,000 more every month.
– That shows your outflow is very high.
– First, list all your loans and EMIs.
– Then list your household and lifestyle expenses.
– Categorise essential and non-essential items.
– Identify leakages in your monthly spending.
– This will give you control over cash flow.

? Reduce Lifestyle Expenses Immediately
– Cut down on eating out and shopping.
– Cancel unused subscriptions and apps.
– Reduce mobile, cable, and OTT bills.
– Avoid online impulse purchases completely.
– Use public transport if possible.
– Stop personal luxuries for a few months.
– Inform your family and get their support.

? Prioritise Loan Repayments Smartly
– List loans from highest interest to lowest.
– Credit card dues and personal loans usually top the list.
– Pay off high-interest loans first.
– Pay minimum for low-interest loans now.
– Avoid taking new loans unless unavoidable.
– Don’t use new loans to pay old ones.
– That increases the problem.
– Try negotiating interest rates with lenders.
– Some banks reduce rates for prompt payers.

? Try Loan Consolidation if It Helps
– Combine high-interest loans into one low EMI loan.
– It can reduce monthly burden.
– This works only if interest is lower.
– Approach a bank, not an informal lender.
– Ensure tenure is not too long.
– Keep the EMI within your limits.
– But don’t stop paying after consolidation.
– Use extra cash to prepay aggressively.

? Sell Non-Essential Assets or Items
– Sell unused electronics or gadgets.
– Sell extra vehicles or bikes if possible.
– Sell gold ornaments if not emotionally attached.
– Use sale proceeds to repay debt.
– Even small amounts help in reducing interest burden.
– Every rupee saved from EMI adds up.

? Avoid Quick-Fix Income Traps
– Don't fall for chit funds or money-doubling schemes.
– Don’t invest in unregistered plans.
– Stay away from risky trading platforms.
– They can worsen your financial condition.
– Easy-looking solutions often come with big losses.

? Improve Income Through Side Hustles
– Use skills to earn extra part-time.
– Freelance jobs like data entry, design, tutoring are options.
– Consider weekend part-time work.
– Rent out spare rooms if you own a house.
– Teach online or offer services locally.
– Every Rs.5,000–Rs.10,000 extra helps cover EMI.
– Use extra income only for loan repayment.

? Check for Existing Insurance or Policies
– If you hold LIC, ULIP, or endowment plans:
– Check surrender value today.
– These give poor returns and long lock-ins.
– If terms allow, surrender and exit wisely.
– Reinvest in mutual funds after clearing debt.
– Buy separate term insurance for protection.
– Mixing investment and insurance never works.
– You need flexibility and liquidity now.

? Pause Investments Temporarily
– If you are investing in SIPs now, pause them.
– Restart once your cash flow improves.
– Use that money to prepay high-interest loans.
– Reinvestment can wait until stability is back.

? Don’t Withdraw PF or Emergency Funds Yet
– These funds are last-resort options.
– Withdraw only if loan burden is life-threatening.
– Try every other step before touching PF.
– Emergency funds must be rebuilt again later.

? Mutual Fund Investments Can Resume Later
– Once loans reduce, start SIPs again.
– Choose active funds with good track record.
– Always invest through a Certified Financial Planner.
– Avoid direct plans as they lack guidance.
– Regular plans come with review and support.
– They help align your investments with life goals.
– A good CFP prevents mistakes and delays.

? Avoid Index Funds in the Future
– Index funds don’t give active management.
– They copy market blindly.
– They don’t avoid weak sectors or poor stocks.
– Active funds manage risk better.
– Active funds give scope for outperformance.
– Index funds fall fully during market crashes.
– That’s risky when you are already under stress.

? Use a Certified Financial Planner Once Stable
– A CFP can structure your debt payoff plan.
– They will replan your investments later.
– They will give long-term wealth direction.
– DIY plans without experience can backfire.
– You don’t need stress on top of stress.
– Focus your energy on recovery.

? Track Your Monthly Progress Closely
– Make a repayment tracker in a notebook or app.
– Note every EMI paid and interest saved.
– Watch your loan balances shrink.
– That gives hope and motivation.
– Celebrate small milestones quietly.
– Don’t celebrate by spending.

? Discuss with Family Openly
– Be transparent with your spouse or parents.
– Involve them in monthly budgeting.
– They may support with some temporary help.
– Children can also understand basic sacrifices.
– Family support reduces emotional stress.

? Don't Compare with Others
– Everyone’s financial life is different.
– Social media shows only happy sides.
– Focus on your own progress.
– Stick to your path and improve steadily.

? Rebuild Step by Step
– First clear urgent dues and high-interest loans.
– Then stabilise your household monthly budget.
– Next, rebuild emergency fund for 3–6 months.
– Then, start SIP in mutual funds gradually.
– Protect with term insurance and health cover.
– Then aim for life goals like retirement, education.

? Income Protection Should Come Next
– Once loans reduce, get a term insurance.
– Your income supports your household.
– Protect it with life cover.
– Don’t mix insurance with investment again.

? Stay Away From Loan Apps and Personal Lenders
– These loans have harsh terms and illegal pressure.
– They worsen your stress and credit history.
– They are not long-term solutions.
– Always deal with RBI-approved institutions only.

? Monitor Credit Score Once You Settle
– Loan repayments improve your credit score.
– A good score helps in future emergencies.
– Don’t close all credit lines at once.
– Keep one active with low usage.

? Avoid EMI Cards or BNPL Products
– These give fake buying power.
– They make you borrow more unknowingly.
– You already need to reduce debt, not increase it.

? Protect Your Mental Health Too
– Financial pressure creates emotional stress.
– Take care of your sleep, food, and focus.
– Talk to friends or well-wishers regularly.
– Maintain your health for long-term productivity.

? Finally
– You are not alone in this struggle.
– You are still in your earning years.
– Act now, be disciplined, and follow a clear plan.
– Don’t try to fix everything overnight.
– Reduce waste, repay smart, and stay focused.
– Avoid risky shortcuts that delay recovery.
– Once stable, begin fresh investments wisely.
– Take support from Certified Financial Planners.
– Make your future stronger than your past.
– With right steps, financial peace is still possible.

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

DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.