Its A nice article on financial planning and prudence. but One point to make while taking loans for purchase of house,car etc. is that it should be understood that there is a difference between depreciating assets and appreciating assets( THOSE THAT DON'T DEPRECIATE- at least.) One can break that rule of 45 in case of acquiring a house/flat/plot/agricultural land/gold , as these are appreciating or atleast don't depreciate with time. Hence while buying these assets one can overleverage based on the liquidity of the asset, as one pay off the loan after selling the asset , if the situation so demands. But in case of depreciating assets like care,gadgets etc which are depreciating assets, one should never take such risks.
Its A nice article on financial planning and prudence. but One point to make while taking loans for purchase of house,car etc. is that it should be understood that there is a difference between depreciating assets and appreciating assets( THOSE THAT DON'T DEPRECIATE- at least.) One can break that rule of 45 in case of acquiring a house/flat/plot/agricultural land/gold , as these are appreciating or atleast don't depreciate with time. Hence while buying these assets one can overleverage based on the liquidity of the asset, as one pay off the loan after selling the asset , if the situation so demands. But in case of depreciating assets like care,gadgets etc which are depreciating assets, one should never take such risks.
