Illustrative reader · Arjun
Young family with a home loan
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Arjun has a home loan a few years into its term, a young child, and a surplus at the end of most months that he has never decided what to do with. His income has risen twice since the loan was sanctioned and his saving has not.
Prepaying the loan against investing the surplus, how much life cover a family actually needs, health cover beyond the employer's, and what a rising income should be doing.
13 articles written for this situation
How Base Health Insurance and Super Top-Up Policies Work Together
A super top-up buys the cover you cannot afford as a single policy, by only paying above a threshold you agree to carry yourself. Understanding how that threshold is measured is the whole of the decision.
Insurance and protection · 4 min read
How to Choose Health Insurance Cover for a Family
Most of the decision is made in three choices — how much, individual or floater, and which limits you accept — and the premium is the least informative number on the page.
Insurance and protection · 5 min read
When DIY Personal Finance Is Enough — and When It Is Not
Most people's finances are simple enough to run themselves, and the parts that are genuinely hard are not the parts people expect. The question is not whether you are clever enough — it is whether your situation contains something that punishes a mistake.
Behaviour and decisions · 6 min read
Why Employer Health and Life Insurance May Not Be Enough
Cover provided by an employer is real cover and worth having. Its weakness is not the quality of the policy — it is that someone else chose the amount, and it ends on the day the job does.
Insurance and protection · 5 min read
How Health Insurance Deductibles Change Cost and Cover
A deductible is an amount you agree to pay before the policy engages, and it is the main lever available for making large cover affordable. It is also the feature most often accepted without anyone working out what it would actually cost them.
Insurance and protection · 4 min read
Do You Need Home Loan Protection Insurance?
You need the risk covered. That is not the same as needing the product the lender offers you at the loan desk — and the difference between the two is usually a large amount of money and a much less flexible policy.
Insurance and protection · 5 min read
How Step-Up Contributions Change a Future Corpus
Raising the amount you invest each year is the most reliable lever anyone has over a long-term goal. It is also the one most often left as an intention, and the difference between intending it and automating it is the whole effect.
Goals and asset allocation · 5 min read
How Much Life Insurance Cover Does a Family Need?
The answer is not a multiple of salary. It is the size of the hole your death would leave in your family's finances, less what they would already have — and working that out takes an hour and gives a very different number.
Insurance and protection · 6 min read
How Lifestyle Inflation Can Undermine Financial Progress
Spending rising alongside income is not a moral failure and not always a mistake. It becomes a problem through a specific mechanism — it raises the cost of the life you must fund forever, while feeling like nothing has changed.
Behaviour and decisions · 8 min read
How to Prepare Financially for a Sudden Loss of Income
Almost everything that makes a job loss survivable has to be arranged while you still have the job. The window for preparing closes on the day you need the preparation.
Fixed income and cash · 5 min read
Should You Prepay the Home Loan or Invest the Money?
Prepaying pays a guaranteed return equal to your borrowing rate, with no tax on it. Investing pays whatever the market pays, after tax. The comparison is between a point and a distribution, and averaging the second one away is how most advice gets this wrong.
Borrowing and major purchases · 6 min read
When Does Refinancing or Transferring a Home Loan Save Money?
A lower rate saves money only if what it saves exceeds what the switch costs, before the borrower stops holding the loan. That is a break-even calculation, and the offer will be presented in a way that hides it.
Borrowing and major purchases · 6 min read
How Repo-Rate Changes Affect Loans and Deposits
A change in the policy rate reaches your loan and your deposit through different routes, at different speeds, and not always in equal measure. Knowing which route yours travels explains why your EMI moved and your deposit rate did not.
Fixed income and cash · 6 min read