Author
LoansJagat Team
Read Time
5 Min
14 May 2025
Personal Loan EMI Calculator – How To Plan Your Monthly Budget?
When you are short on funds, taking a personal loan might seem like a smart decision, but the real struggle starts when EMI begins.
Rashmi is an assistant professor. She took a personal loan of ₹3,00,000 at 12% for 3 years. Her monthly EMI came out to ₹9,967.
She evaluated her monthly and decided to extend her personal loan tenure to 4 years, which reduced her EMI to ₹7,901.
This has helped her handle savings, groceries, and rent with ease, all within a monthly income of ₹50,000.
If your EMIs are not properly planned then it can result in disrupted cash flow and missed bills. So you must understand your EMIs before borrowing.
Why EMI Planning Matters?
It is important for you to have a clear idea of monthly EMIs, whether you are taking a loan for travel, medical urgency, or wedding. Using an EMI calculator helps you estimate how much you will need to pay each month.
To find your EMI, simply enter the following details:
- The annual rate of interest
- The tenure (in months)
- The amount of the loan
The calculator instantly shows your monthly EMI based on the details you provide. It also shows the total interest you'll pay over time and the overall repayment amount.
Now, you can easily align EMIs with your actual income and lifestyle without surprises later.
Understanding The EMI Calculation Process
The usual way to figure out your EMI is:
EMI = [P × R × (1+R)^N] / [(1+R)^N – 1]
Here,
- P = principal amount of the loan
- R = monthly rate of interest
- N = number of EMIs (loan tenure in months)
If you took a personal loan of ₹2,00,000 at a 13% annual rate of interest for 24 months, then,
Your monthly interest rate (R) = 13 ÷ 12 ÷ 100 = 0.0108, and your EMI = ₹9,536 approx.
Let’s compare of EMI of a personal loan of ₹2,00,000 at a 13% annual rate of interest across different tenures:
Tenure (Months) | EMI (₹) | Total Repayment (₹) | Interest Paid (₹) |
12 | 17,932 | 2,15,184 | 15,184 |
24 | 9,536 | 2,28,864 | 28,864 |
36 | 6,739 | 2,42,604 | 42,604 |
You can see that the longer tenure has reduced the EMI but increased the total interest paid by you.
Aligning EMI With Monthly Income
It is suggested by mostly financial planners that you keep your EMI under 40% of your net monthly income.
According to this, if your salary is ₹1,00,000 then your EMI should not exceed ₹40,000. This makes sure that you have enough money left for your expenses and savings.
Let’s see a suitable EMI range for different incomes:
Monthly Income (₹) | Suggested EMI (₹) | Estimated Loan (3 yrs @12%) |
25,000 | 8,500 | ₹2,50,000 |
50,000 | 17,000 | ₹5,00,000 |
75,000 | 25,000 | ₹7,50,000 |
1,00,000 | 33,000 | ₹10,00,000 |
Using A Personal Loan EMI Calculator The Right Way
The EMI calculator is not just for calculating EMI. You can test multiple combinations using an EMI calculator until you find one that suits you best.
The following are the steps to use it effectively:
What To Do? | Why Does It Matter? |
Start with the minimum amount you truly need, not the maximum. | Helps avoid borrowing extra. |
Try different tenure options, like 12, 24, 36, 48, and 60 months. | Ensure you choose the best tenure. |
Adjust the rate of interest according to what lenders are offering you. | Small rate shifts can greatly affect your repayment. |
Check total repayment. | To see if you are comfortable with the load of the interest. |
Make sure your EMI fits within 40% of your monthly income. | Make sure you can repay on time. |
Practical Monthly Budget With EMI Included
Dhruv has a monthly income of ₹60,000. After using an EMI calculator Dhruv decided to take a ₹3,00,000 loan at 12% for 36 months. His EMI will be ₹9,967.
Let’s see if he can adjust it into his monthly budget:
Expense Head | Amount (₹) |
Rent | 15,500 |
Groceries | 6,500 |
Utilities | 2,500 |
Transport | 4,000 |
Personal Loan EMI | 9,967 |
Insurance and SIPs | 7,500 |
Miscellaneous | 5,500 |
Total | 51,467 |
Surplus Left | 8,533 |
This gives Dhruv enough money for savings and unexpected expenses.
Compare Before You Commit
Different rates of interest are offered by different lenders. A 1% change in interest can alter your total repayment by several thousand rupees.
Let’s compare the different rates of interest on a loan of ₹3,00,000 for 3 years:
Rate of Interest | EMI (₹) | Total Interest (₹) | Total Repayment (₹) |
10% | 9,675 | 48,300 | 3,48,300 |
12% | 9,967 | 58,812 | 3,58,812 |
14% | 10,270 | 69,720 | 3,69,720 |
You can see that with an EMI difference of ₹300 to ₹600 monthly, the total interest gap is over ₹20,000.
Final Thoughts
A personal loan can solve your financial problems, but the real victory lies in how you plan to repay it. With the personal loan EMI calculator, you can get clarity and make smart financial decisions.
The personal loan EMI calculator shows more than just numbers, it shows you how a loan will affect your finances.
Before applying, spend your few minutes checking different loan amounts, tenures, and rates. Now, you can easily manage your EMI with your current lifestyle and future goals.
FAQs
1. Should I check offers before finalizing the loan?
Absolutely. You must compare multiple lenders using EMI calculators.
2. Do EMI calculators include insurance or taxes?
Usually not. Confirm those separately from the lender.
3. Are calculators available on all bank websites?
Yes, most banks offer free EMI calculators.
4. Is a personal loan EMI calculator reliable?
Yes, it gives a precise EMI estimate, excluding processing fees.
About the Author
LoansJagat Team
We are a team of writers, editors, and proofreaders with 15+ years of experience in the finance field. We are your personal finance gurus! But, we will explain everything in simplified language. Our aim is to make personal and business finance easier for you. While we help you upgrade your financial knowledge, why don't you read some of our blogs?
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