A recent industry survey revealed that nearly half the Indians are fine with taking loans for purchasing big-ticket consumer goods such as refrigerators, TVs, and mobile phones. Hence, debt is not an atypical financial state to be in and must not always be looked at with a negative lens, because, in many cases, it can help you to achieve financial stability.
However, debt must be managed well in order to minimise its negative impact on personal finances. Debt can spiral out of control if it goes unchecked and this can lead to serious consequences for your credit score. Having bad debt can also impact a person’s ability to get a job or rent an apartment, which in turn leads to further financial instability. In order to avoid such a vicious cycle, there are several ways through which debt can be effectively managed.
First and foremost is to always secure your loan from a credible and reputed financial lender. Often dubious players lure customers with attractive schemes and later during repayment, the customer realizes the scam of hidden charges and ambiguous terms and condition which makes it difficult to handle the debt. So opt for lenders who have clear repayment policies, clarity on fee levied and offers terms and conditions which are customer friendly, because in case of any unprecedented event such as the pandemic, there must be scope for the lender and burrower to be flexible with the debt payment.
Ways to manage debts effectively