Categories
Personal Finance

Planning to repay home loan? Consider FD

You have taken a home loan and it may take a significant amount of your take-home-salary to pay for it’s EMI.

Usual tenures for home loan are 20 years , 25 years and 30 years but the most common is 20 years.

There are times in life when you are looking at monthly bank statements and want to get rid of home loan EMI at the earliest.

Scenario – Let’s consider a scenario where you have taken a home loan for 20 years and half way through it’s tenure, you think that you are in a position to repay the remaining amount.

High Level Loan Details

Loan Amount1 CR
Loan Tenure20 years
Loan EMI88,371
High Level Loan Details

Amortization Schedule

Interest paid in the FIRST 10 years

From the above amortization schedule, you can see that although 50% of the loan tenure is over but principal repayment is only 30%.

Please note that in the initial years, most of the EMI goes towards interest payment.

Intrest paid in the first 10 years in 70 lacs.

Interest to be paid for last 10 years

Interest paid in the last 10 years is APPX 42 lacs.

Scenario

Let’s look at the original scenario again –

  1. You have paid EMI’s for 10 years
  2. You have 75 lacs cash and want to repay the home loan fully

Assumptions

For the sake of simplicity, I am making the following assumptions

  1. Since you have sufficient cash to repay the remaining home loan of 75 lac, I am assuming that you can still pay home loan EMI for the next 10 years
  2. Home loan rate remains at 8.75% through the 20 years and FD rate remains same at 7% for next 10 years

Consider booking a FD?

Final Word

Before making a decision to repay home loan, consider safe investment option only which give guaranteed returns.

Do not be tempted by mutual funds or other capital market instruments lime stocks , futures and options.

I have used HDFC Home Loan calculator and FD calculator. You can play around with the numbers based on your current situation.

Categories
Cloud Certification

AWS Certified AI Practitioner – BETA

AWS has launched a BETA version of AI Practitioner of AI Practitioner exam which is cheaper (currently priced at USD 75) by 25% than the regular foundation level exam pricing.

Wondering if BETA exams will provide a certificate. Yes, a certificate will be provided similar to the standard exam which is valid for three years.

What the exam will validate

Exam is going to validate in-demand knowledge of Artificial intelligence ( AI ) , machine learning ( ML ) and generative AI concepts and use cases.

Categories
Cloud Certification

AWS Certification – Foundational vs Associate

Students and professionals who wish to get their cloud skills validates often get confused which certificate they should chose to start with.

Most of them prefer either a foundational cert – Cloud Practitioner vs one of the associate ones.

Although both are easy certificates to prepare for but it will be economic to go for foundational ones first and then associate cert.

Certification TypeExam FeeDiscount CouponNet Fees Paid
Cloud PractitionerUSD 100N.A.USD 100
Associate ( E.g Solution Architect)USD 150USD 75USD 75
AWS Cert Fee Comparison

From the above table, you can see that Associate alone would cost USD 100 and it will cost USD 175 together with Foundational Cert. For an additional fee of USD 25, you get to enjoy two certificates which can make your resume more searchable.

Categories
Cloud Certification

Is Cloud certification worth it?

It may not be useful in your day to day work be it your own work or your employer’s work . The only help it might do to you is getting your resume shortlisted and getting an interview call.

You will get used to terms and terminologies but actual work will be very different from what you read in your certification courses.