Many of us dream of owning our own house but need help investing all our savings and paying numerous EMIs monthly.
However, experts suggest that, with some careful planning, it is possible to achieve this dream without taking a loan.
For many middle-class individuals, life goals typically include a job, marriage, children, education, marriage, and buying a house. However, this often leads to a situation where one spends one’s entire life paying EMIs.
Previously, getting married or buying a house typically required taking out loans. However, with government incentives, home buying has become more accessible through loans and EMIs.
The downside is that one may end up paying EMIs for the rest of their life. Imagine the relief of not having to worry about these EMIs for the rest of your life.
Buying land and building a house is costly, so many people prefer to buy a flat in an apartment. However, there are challenges to this approach, as some experts suggest that the value of plots decreases over time.
Given these challenges, some experts propose a method to buy a house without debt within ten years through strategic financial planning.
Here are the proposed methods:
Investment in Mutual Funds: If the price of the desired flat is Rs. Fifty lakhs and you can afford a down payment of Rs. 10 lakhs, consider investing the down payment amount in mutual funds.
These funds are expected to grow by 15 percent annually. After ten years, the investment is expected to reach around Rs. 40 lakhs.
Phased Investment: If you take a loan of Rs. 40 lakhs to buy a house, you must pay EMIs for 20 years. To tackle this, start saving the EMI amount by allocating your current rent of Rs. 10,000 and investing an additional Rs. 26,000 monthly in a phased investment method, earning 14 percent interest. This strategy will yield around Rs. 68 lakhs after ten years.
By following these methods, it is estimated that you could have around Rs. 1.08 crores after ten years. This amount and the potential increase in real estate value could enable you to buy a flat without any issues. Therefore, it is not just a dream but a genuine possibility that you can own a house without a loan.