Thanks to easily accessible loan offers and EMIs, you can get finance for your dream – be it purchasing a laptop from an online marketplace or shopping for a new car. While loans have made it easier to fulfil your needs and reach your goals, you should also be mindful of the potential EMIs payable on loans to ensure they are well-within your affordability limit. This is where an EMI calculator is beneficial. This free digital tool lets you estimate EMIs and select an offer that aligns with your budget. This article discusses the various benefits EMI calculators bring to the table in detail.
Five key benefits of using an EMI calculator
EMI calculators offer users a host of benefits. We’ve listed the top 5 benefits of using an EMI calculator below:
Quick calculation
Digitised EMI calculators help simplify complicated calculations to offer instant results. All you need to do is enter the loan amount you wish to borrow, your preferred tenure, and the applicable interest rate. The calculator uses these variables to compute EMI estimates and the total interest paid on the loan instantly. It would take you a significant amount of time to perform the same calculation manually with a pen and paper.
Better accuracy
A standout benefit of an EMI calculator remains its accuracy of predicting EMIs. If you were to calculate EMIs using manual calculations, there would be a sizable scope for errors. A single miscalculation in the process would be enough to distort results. However, this is not a concern with an EMI calculator. This digital tool uses algorithms to calculate EMIs with the greatest precision and accuracy to ensure you have a clear idea about your monthly repayment obligations and can assess the affordability of the loan accordingly.
Effective loan comparison
When choosing an ideal loan, it is important to assess offers across various parameters like interest rates, fees, etc. An EMI calculator helps you understand how the cost of borrowing changes with changes in interest rates, thereby facilitating comparisons. Since EMI calculators can generate instant results, you can use these tools to run multiple simulations. You can modify various borrowing parameters like the loan amount, tenure, and interest rate to see how your EMI gets altered. You can leverage this feature to compare different loan options from banks and NBFCs to see which one is the most cost-saving and suitable option for you. Remember, even a slight difference in interest rates can have a significant impact on the overall cost of the loan.
Better loan planning
EMI calculators are known to simplify financial planning for borrowers. By entering various loan parameters, you can instantly review the potential EMIs payable for the loan. Understanding your monthly repayment obligation helps you budget for the same. It also helps you ascertain the affordability of the loan. If the EMI is too high, you can consider changing the loan amount or tenure to identify the ideal borrowing parameters that suit your budget. In short, EMI calculators help ensure that you borrow within your means and plan ahead.
Easy accessibility
Another benefit of EMI calculators remains easy accessibility. Earlier, getting EMI estimates meant visiting the physical branch office of the lender during office hours. With digitally accessible EMI calculators this has changed completely. Now you can access EMI calculators from the comfort of your home or office using a smartphone, tab, or laptop. In other words, you can access EMI calculators at any time and from anywhere to compute EMI estimates. With 24×7 access, you can plan your loans as per your convenience.
Conclusion
EMI calculators are key tools in responsible financial planning. They help borrowers understand the EMI obligations in advance and assess whether the loan fits in their budget. By offering quick and accurate EMI estimates, EMI calculators help prevent overborrowing and ensure accurate financial planning. Moreover, these tools offer unparalleled benefits in terms of conducting comparative analysis of loan offers. With the easy accessibility of EMI calculators, you can run multiple simulations day or night to understand which offer helps you save on interest payments.
