Weddings are prestigious and joyful family events, and you too may wish to make each ceremony in your wedding grand. The right decor, food, music, gifts, and overall arrangement can help you make it a memorable experience for yourself and all your guests.
However, organising a grand event requires a grand investment. While you may have saved up specifically for it, you may need more funds to make your dream wedding a reality. This is where a personal loan can support you in addressing all wedding-related expenses.
Read to know about the do’s and don’ts of using a personal loan for a wedding and how to get started with planning your finances.
Guide to Financial Planning For a Wedding
Organising a wedding takes work. It is best for you to be aware of your finances and have a basic idea of what you need the loan for. Here are two steps to follow:
· Assess Your Financial Situation
Conduct a proper evaluation of your finances, such as your savings, income and any outstanding debts. Understanding your financial health will help you identify whether or not you require a wedding personal loan. It will also help you understand how you can repay it if you decide to go for it.
· Create a Realistic Budget
A well-organised wedding doesn’t mean you need to overspend. Creating a budget is the best way to avoid unnecessary spending. Consider expenses like catering, entertainment, decorations, and venues. Creating your budget will help you decide how much finance you need and help you stay on track.
Personal Loans: Do’s and Don’ts
· Do Compare Offers From Different Lenders
There are various banks and NBFCs in the market today offering personal loans for weddings. All you need to do is compare their features. Check various aspects, such as the application process, disbursal speed, online loan management, customer service and value-added benefits. The more you learn, the easier you can decide on which lender to go for.
· Do Consider the Interest Rates
Usually, rates of interest on unsecured marriage loans vary between 10.50% to 24%[1] based on which lender you choose. Getting the best interest rates also depends on how good your credit score is and how strong your finances are. Since interest rates directly impact your EMIs, make sure you choose a lender with the most reasonable rates.
· Do Access Your Credit Score
A good credit score above 750[2] makes it easier to get your wedding loan sanctioned quickly. It also ensures you get the loan amount you want, along with a competitive interest rate.
To access all these benefits, maintain a good score and review it before you apply for a personal loan. If it is not up to the mark and you have time on hand, work on improving it.
· Do Understand Your Repayment Terms
Your loan needs to be repaid on time, so you can avoid additional charges and keep your credit score up. In order to repay without strain, choose the right loan amount and tenure. Usually, lenders give you up to 5-6 years to repay a personal loan for weddings.
The tenure is especially important here, as a longer one reduces your monthly instalments while a shorter one increases them. However, the advantage of a shorter tenure is that it reduces the total interest you pay. So, choose your loan terms carefully.
· Don’t Miss Hidden Costs Like Bounce Rates and Penal Interest
There are several hidden charges that lenders may not be upfront about. These include processing fees, prepayment charges, EMI bounce fees and penal interest. Make sure you are aware of all of these, as they can impact the cost of your wedding loan.
· Don’t Forget To Check If You Qualify and For How Much
Lenders give you the green light on your loan application based on various criteria like your credit score, current income, age and debts. So, check your eligibility before you apply to avoid rejection.
You can also use a personal loan eligibility calculator to see the potential loan amount you qualify for, which is usually up to ₹50 Lakhs for weddings. This will help you plan your wedding expenses in a more informed manner.
· Don’t Opt For an Instalment Amount That You Can’t Pay
One of the important considerations to keep in mind is your loan’s monthly instalment. Use the EMI calculator to compute various EMIs by changing the tenure and loan amount. Ensuring your EMIs are affordable helps you have a hassle-free experience all through the tenure.
Consider all these do’s and don’ts, as they can help you host a wedding without exposing you to a financial crisis. To apply for a personal loan for a wedding online and see offerings from the best lenders, check the Bajaj Markets App. Download the app from Google Play or the App Store and plan your grand wedding stress-free.