Overspending on Diwali shopping? Know how to manage your finances this festive season


After two years of muted celebrations due to Covid-19 restrictions, you might be tempted to shop more this festive season to take advantage of deals, discounts, cash back, and more. offered by retailers, online platforms and financial institutions. The availability of easy credit through digital loans, EMI options, BNPL, etc. would even make you spend too much without too much difficulty.

However, you should remember that using credits for overspending would create payment obligations from your future earnings, and any default in repayment would attract huge interest.

Anil Pinapala, CEO and Founder of Vivifi India Finance outlines personal finance rules to keep in mind during the holiday season:

“With big discounts on several products and services this festive season, you will most likely tend to indulge in impulse purchases that will drive up your spending. These costs could exceed your income and weigh on you financially. Therefore, good financial planning becomes the need of the hour to balance out all the extra expenses and amplify the joy of your celebrations,” Pinapala said.

Here are a few things to remember this festive season:

Save up front for festive celebrations

If you start a few months in advance by tracking your expenses and setting aside an amount of your income each month, you should be able to effectively manage holiday expenses. This advance planning will give you the freedom to go ahead and make big purchases or plan a trip without the expense interfering with your long-term financial goals. If you haven’t saved before the festival, you can still benefit from a personal loan to finance your purchases.

Set a budget and avoid straying from it

Depending on your income and your bank balance, plan a budget for your purchases. The list of planned purchases can help you determine the cost. Remember that financial discipline is essential and adhering to this practice will ensure that you are not financially overburdened.

Take advantage of offers and discounts to make your purchases

Festive occasions are one of the best times to buy the things you’ve been wanting for a while in a cost-effective way. There are also such occasions where lending platforms such as banks and fintechs collaborate with online retailers, resulting in additional discounts, including discounts on personal loans, etc. Take advantage of these discounts to make your purchases.

Talking about the importance of remembering personal finance rules when shopping on Diwali, Anand Punmiya, Board Advisor and Financial Expert, said, “Personal finance is an important aspect of our lives and the way we we plan them has an impact on all the other factors related to it. A small leak can sink a huge ship, just as so-called “small” expenses can end up sinking your budget. Especially when those “small” expenses add up to a large sum of money that you haven’t budgeted for. »

“Timely repayment is key to having a healthy credit rating, and again this is crucial for any future loan needs you may have, as well as keeping interest rates low,” he said. -he adds.

“Late payments or missed payments should be avoided because they lead to an additional financial burden, because the bank or credit institution will then charge late fees, penalty interest, etc., which will again increase the charges. of payment. To avoid such hassles, borrowers may consider prepaying loans in part or in full when they have access to additional liquidity, but before opting for this, it is important to ensure that there is no There are no prepayment penalties or waiver/reduced penalties can be negotiated. for prepayment,” Punmiya added.


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