This book on personal finance suggests ways to take a loan without getting into serious debt

Personal loans are useful for fulfilling financial needs, but wrong decisions can turn them into a source of stress. You can maintain financial stability by following these rules:

1. Borrow only what you truly need: You will feel intense financial pressure if your total EMIs exceed 40% of your monthly income. You should take a loan only for critical needs like medical emergencies or education.

2. Choose the best loan offer: You should compare interest rates, processing fees and terms across various banks. Use online calculators to find a plan that fits your budget.

3. Pay your instalments on time: Missing an EMI results in heavy penalties and damages your credit score. You must manage your budget to set aside funds specifically for your instalments.

4. Keep the tenure short: A longer tenure reduces the monthly EMI, but you pay much more in total interest. You can clear the debt faster and save money by choosing a shorter period.

5. Read the agreement carefully: You must understand all terms, fees and penalties before signing. Avoid borrowing from unknown or unreliable institutions. Demand clarification from the bank if any clause is vague.

6. Avoid borrowing for investments: Personal loans carry very high interest rates. You should never borrow money to invest in the...

   Read more