A two-wheeler is often a person’s first vehicle. However, owning a bike is not always a necessity for many people; rather, it is a passion. It’s time to finally bring the bike you’ve always wanted home!
However, how should you buy a bike? Should you pay for the purchase with savings or a loan? Every buyer faces these difficulties. Right now, bike loans are very affordable. It is now possible to walk into a showroom and walk out with your bike because the majority of the best financial institutions offer the lowest interest rates and 100% financing. Saving money to avoid paying interest is another option. You also have the option of purchasing the bike by selling other assets. A credit card can also be useful if your bike is cheap.
So, which choice should you make? Should you use a credit card, a personal loan, a bike loan, or your savings? Let’s investigate:
Committee Savings The Best Way To Get Your Dream Bike Without Getting Into Debt.
A personal loan is a short-term, unsecured loan that can be obtained from a number of lenders, such as banks, non-bank financial corporations, and online fintech lenders. Personal loans have less stringent eligibility requirements and documentation requirements than other loans like home loans and education loans. Personal loans are simple to obtain because they do not require any kind of security or collateral. Because of this reason, interests on loans are on the higher side (beginning from 16% onwards).
Taking a bike loan from a bank or NBFC is the most common method for purchasing a bike because it is affordable and requires little KYC documentation. You can also finance the entire amount or get a loan with a down payment to cover the balance. Bike loan applications are typically approved on the same day by the majority of lenders. So, you won’t have to wait long to buy the bike of your dreams.
Using a credit card is the next option for buying a bike. However, you can only use this way if the bike you choose has a lower price and your credit card’s credit limit lets you spend that much. However, if the bike of your choice falls within your credit card’s borrowing limit, all you have to do to get your hands on it is go to the bike dealership and swipe your card.
Your credit card can be used, but be careful. You should only use a credit card if you are confident that you will be able to pay your bills on time because of the high interest rates they charge. You may also be required to pay the penalty and additional interest if you miss payments, depending on the policy of the lender.
However, these loans have high interest rates, some as high as 10%. A bike loan can only be obtained with a credit score of at least 750. It is hard to get a bike loan approved for people who don’t have a good credit score.
Read: Our own habits leads to debt trap: How to get out of it?
Start Saving For Your Bike NOW
Purchasing a bike is most effective when using savings. You won’t have to pay a lot of interest to buy the two-wheeler you’ve always wanted if you have enough money saved up. You can begin by setting a goal, such as how much money you need to buy a bike, and then put some of your income aside to reach that goal. You could, for instance, begin investing a predetermined amount each month in a committee platform for the next two years toward the purchase of a bicycle.
If you, for instance, put aside Rs 3,000 each month in a committee scheme, you will end up with a lump sum of approximately Rs 80,000 after two years (keep in mind that a committee savings gives you at least 10% p.a.) interest, which is also significantly higher than what banks offer on fixed deposits).
On the other hand, if you want to purchase the bike earlier, you can bid for a lump sum at any time during the next two years and receive your bike while continuing to pay the remaining installments. Additionally, investing Rs. 3,000 each month is something that won’t break the bank. Saving for something you will really enjoy in the near future gives you a great deal of satisfaction.
When you take out a loan, you are adding to the debt. Consequently, you end up paying EMIs that are greater than the borrowed amount. However, you are saving your own money with committee. You set money aside each month in both scenarios. A chit fund is an investment, but a loan requires payback. Consider the differences, then make up your own mind.
Read: How Saving Money Becomes Easy With The Help of Community?
What is Money Club?
With technology advancements and digitalization even these age old form of committees have gone online. The Money Club is a safe and secure mobile app based on the concept of Committee and the users can save, invest or borrow sitting at home without the hassle of documentation. It is the first ever social network dedicated to helping members earn money, save money and support one another financially. Here a group of verified members come together and contribute a fixed amount every month for a particular tenure. When you need money, you just have to bid, and the money is in your bank account in six to eight hours that too at low interest rate. To know more about how it works you can see the video here.
Read: Online Committee System: Simple Way to Raising Debt
How to Save Money from Salary? 15 Smart Tips
Benefits Of Money Club App
- It is the best platform for middle-class families who cannot obtain loans in an emergency and must rely on high-interest money lenders. With the Money Club platform you can quickly receive a lump sum amount in an emergency if you regularly save small amounts on this platform.
- You join a group of verified friends and pool money with them.
- You can borrow a sum several times greater than the amount you have invested.
- When you need money, you just have to bid, and the money is in your bank account in six to eight hours.
- All transactions are digital. Members of the club deposit funds into your bank account directly. The money does not lie with the organizer.
- You can earn money from home. If you sign up to be a Money Club agent and recommend to 20 of your friends and family, you could win Rs 20,000.
Download the Money Club app and get your dream bike without getting into debt.
Read: How To Increase Your Income to Improve your Financial Health?
Is Vacation Loan the right way to fund your vacation?