The perils involved with option trading once again came to the fore on the internet where a 30-year-old man said he lost over Rs 2 crore in option trading.
Earlier this week, the man said on Reddit that he earns Rs 2.85 lakh per month but he lost over Rs 2 crore in option trading and kept borrowing to keep himself afloat and has sought help from netizens on ways to reduce his debt.
"I’m a 30-year-old salaried professional working at a reputed firm in India. My monthly take-home is around ₹2.85L. On paper, things look fine — but the reality is very different.
"Over the last few years, I got deeply into options trading. What started as “side investing” slowly turned into something unhealthy. Long story short, I’ve lost a very large amount of money (2 cr+), and to plug losses and keep things afloat, I kept borrowing. Today, my outstanding unsecured debt looks like this (approx): Rs 27 lakh personal loan (HDFC), Rs 28 lakh Bajaj OD loan, Rs 8–9 lakh across smaller NBFCs, Rs 12 lakh credit card dues (2 cards)," the unidentified man said in his viral Reddit post.
The Reddit user said he's ready to let his credit score get 'destroyed' if he can avoid paying the EMIs and start on a fresh slate.
"At this point, my EMIs + interest are so high that even with my salary, there’s no realistic way to service everything without living in constant panic. I’ve stopped trading completely and have no intention of going back — that chapter is closed.
"I’ve been thinking seriously about defaulting and then possibly negotiating settlements later. My intention is to move my salary account to Axis Bank by opening a new savings account with them, and keep nil balance on both HDFC & SBI (linked to loans). I understand that this will destroy my credit score, and I’ve mostly accepted that I may not be able to take loans for many years. I’m okay with that if it buys me mental peace and a chance to rebuild properly," he said.
He also said that he has mended his ways and is no longer doing option trading and intends to get married in next few years.
"I’m not trying to “run away” or game the system. I’m just trying to choose between two bad options and pick the one that lets me live a stable, honest life going forward. I plan to save aggressively, live within means, and stay debt-free after this.
"I also plan to get married in a few years and want to understand if defaulting now permanently ruins that future, or if people do come out the other side," he said.
His worries regarding the default are as follows: "What actually happens in India if you default on multiple unsecured loans, How bad does recovery harassment realistically get, Is salary attachment a real risk for someone in a corporate job, Does this ever spill over to employer / HR, How badly does this affect family members (calls, visits, etc.), Has anyone here defaulted, settled later, and rebuilt life peacefully?"
Netizens said defaulting on credit card debt will mean constant harassment for both him and his loved ones.
"Try to talk with one of the bigger banks about consolidating your debt into a single loan. Given your current condition, they might charge a higher interest than prime, but still an 80L loan at 13% for 5 years will come to an EMI of 1.8L. That would still leave you with 1L for your regular expenses and discretionary spends, which goes without saying you'll need to keep in check," one Reddit user advised.
"Clear the loans with the highest interest rates first (probably in following order): Credit Card, NBFC, Bajaj OD, HDFC," said another Reddit user.
"You are in a hole but you have decent pay should be doable," assured one netizen.
"Be calm, think over it, you can clear it in upcoming years with good finance management. Take help from some good finance management firm and don't settle the dues as it will hurt in the long run as the bank will not consider you firmly for future needs if any. As you are a good earner and your salary will increase with time, just think of a way out and take professional advice. You will get over it and you will definitely win this," advised another Reddit user.
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