Can you buy a helicopter! Is it really possible? Yes indeed, with the power of EMI, anything is possible. EMI is a very “beautiful” concept and each one of us can buy a helicopter. It’s very simple; all you have to pay is Rs.6,677 per month only for the next 200 years. Sounds strange, doesn’t it? But don’t you agree with the fact that this EMI concept gives us a feeling that we cannot only “BUY” things but rather “AFFORD” each and every thing. In continuation to my previous articles on “Credit Card Ke Side Effects” and “Secrets to Saving Money”, let’s delve further and understand this:
“Afford” Vs “Buy”
The fascination of EMIs makes everything available on this earth and everything looks very much affordable. Most people when presented with EMI offers, do not see the total cost which they would be end up paying, but could only see the monthly payment of Rs.6,677 (in the above example). It makes the herculean task of buying a helicopter also seem very easy. Let’s see a very practical example. Last month I decided to buy a cellphone worth Rs.20,000. I had already fixed my budget and wanted to buy this particular handset in cash. However, to my surprise while buying the same at a mall, I was told that I can own this mobile through their EMI schemes only! And to add to it, all I was advised to buy their latest and fourth generation series model than the one I had planned. This latest series model was way beyond my budget at Rs.40,000 but available on EMIs in 12 monthly instalments of Rs.3,467 only with zero down payment. All of sudden a product way beyond my budget becomes easily affordable to me and I could also pocket the remaining cash. More importantly now I can “OWN” the best and the latest. Haven’t you faced a similar situation?
EMI ke Side Effects!
The cellphone example mentioned above extends to buying any other product like a car, a TV, a camera and even apparel nowadays. EMI prompts us to purchase things that we don’t really need and way beyond our budget. It ultimately leads us to lose control over our spendings.
But is EMI really bad? No, if we use it wisely. For example, it is really beneficial when purchasing a house; through a home loan EMI we can create a solid asset at an early stage which otherwise would have been impossible.
0 per cent Interest!
Going the EMI way would be beneficial if the 0 per cent interest schemes without processing fee is on offer and there is no cash discount on 100 per cent upfront payment. However, it is advisable to always read between the lines first and ask for a cash discount if paying upfront.
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