Budgeting Tips for Managing Multiple EMIs – Smart Loan Planning

Akash was my college senior. We met once on the metro. On the way, he told me he had a ₹9,000 home loan EMI. ‘Kahani abhi baaki hai mere dost!’ He also had a ₹4,500 car loan and a ₹2,000 credit card bill. So, I suggested he sync EMIs with his salary and apply the 50:30:20 rule.

Let’s see how these strategies helped him save ₹3,000 monthly, as shown in the table below.

Like these, there are multiple strategies that can help you manage your EMIs in a much better way. Let’s discuss a few of them in this blog. 

1. Prioritise by EMI Size and Interest

Priya pays ₹4,200 for her education loan and ₹7,000 for a credit card debt at 36% interest. If she follows this rule and pays high-interest EMIs first, she will reduce the overall cost much earlier. This also keeps penalties in check. Why pay extra money when you can save some?

For example, Vikram, a 30-year-old sales executive in Bengaluru, got a bonus of ₹25,000. He used it to close his credit card EMI rather than prepay his bike loan. It looked like a small step, but it saved him almost ₹7,200 in interest over a year.

The table shows his debt types and why he chose to pay credit card debt first.

2. Use a Single EMI Calendar

Rahul missed his ₹3,000 mobile EMI last month because he got confused with his ₹9,000 home EMI. That is why we always recommend that our readers create a shared calendar or reminder system. This will help you align due dates or automate payments so you never miss one and pay late fees.

For example, Meenal used to pay ₹16,000 in EMIs across 4 dates. She forgot the 25th’s EMI once and got a ₹720 penalty. So, she decided to sync all to the 5th. No more confusion, therefore no missed payments.

3. Keep 2 Months’ EMI as Backup

Sneha saved ₹20,000 as an Emergency fund for her EMIs. This proved really helpful when she lost work for a month. She still paid her ₹9,800 EMI on time. It is important to maintain a 1–2 month EMI reserve. It acts as a backup in case of job loss, delay in salary, or unexpected expenses.

For example, Rakesh runs a fitness studio in Surat and earns ₹68,000 monthly. For his ongoing home loan, EMI is ₹11,200. During a local lockdown, his income reduced to ₹30,000 for two months. Since he had saved ₹25,000 in an FD for a situation like this, he was able to pay his EMI buffer.

Here’s how his finances looked for the past 4 months:

4. Consolidate Small EMIs into One Loan

I always mention Arjun when it comes to debt consolidation. He had 4 EMIs totalling ₹18,500. He took a personal loan of ₹2.5 lakh at 12% to clear them and paid ₹8,300 per month. 

Genius, right? See how debt consolidation simplifies finances and lowers monthly stress. Ensure the new loan has better terms than your existing EMIs.

For example, Divya is a graphic designer in Noida. She had 5 different EMIs of ₹34,157 per month. She took a ₹3.5 lakh personal loan at 13.5% for 3 years, reducing her EMI to ₹11,793 and saving ₹22,260 per month.

Let’s see how debt consolidation worked for her with this table:

Conclusion

‘Parade Thap!’ Tired of memorising each and every detail about your car loan, home loan, credit card and whatnot? Well, you need to stop torturing your brain with all this information; it’s too much. Instead of syncing due dates, prioritise high-interest debts, build an EMI buffer, or consolidate loans.

Try any of these (or all of them) and see how your stress level reduces. How? ‘Ye kya baat hui?’ When you avoid penalties and even save thousands each month, “stress toh kam hoga na!’.

Frequently Asked Questions

1. How to manage multiple EMIs?

Sync EMI dates, set auto-debit, build an EMI emergency fund, and prioritise high-interest debts. Plan monthly budgets and avoid new debt if to debt-to-income ratio is high.

2. What happens if I pay 1 EMI extra every year?

One extra EMI yearly reduces the loan tenure and interest burden. It saves thousands on a ₹10 lakh loan, for example. It definitely helps with your tax refunds.

3. What is the 40 EMI rule?

Your total EMIs should not exceed 40% of your monthly income. It ensures good credit health and improves chances of getting future loans at lower interest rates.

4. How to pause EMI for 3 months?

Apply for a moratorium via the bank app or branch. Submit proof like job loss or medical bills. Interest keeps adding, so use only in emergencies.