Buying a ₹1 lakh phone: earn interest instead of paying EMI

The Story in Brief

A ₹1 lakh smartphone is often presented as a smaller monthly EMI, for example ₹8,000-₹9,000, which can make the decision easier even when the total cost is higher. The article gives an example: financing ₹1 lakh for 12 months at 15% annual interest yields an EMI of about ₹9,025 and total repayments of roughly ₹1.08 lakh, including about ₹8,300 in interest, excluding fees, taxes and other charges. The phone is received immediately while it starts depreciating.

As an alternative, the article describes investing ₹10,000 each month in short-term bonds with an illustrative 12% annual return. Over ten months the contributions total ₹1 lakh and the corpus could reach about ₹1.05 lakh because each instalment earns returns for different durations; a full-year lump sum at 12% could earn about ₹12,000. The piece notes that bond maturities, payout schedules and availability vary, that zero-cost EMIs may involve giving up cash discounts or incur fees, and it suggests building a purchase fund to avoid successive EMIs.

The Indian Opinion

The article gives a practical comparison between buying on EMI and saving to buy, but several figures are illustrative rather than guaranteed. The 12% return and the cited platform are examples; actual bond yields, availability and liquidity can differ and will affect outcomes. The piece correctly warns about processing fees, taxes and fixed monthly obligations with EMIs, and that short-term bonds have set maturities and payout schedules which may require selecting different instruments over time. Given the article’s promotional note, readers should verify returns, fees, minimums and liquidity independently and consider their own cashflow and risk tolerance before choosing a strategy.

Original article: Earn Interest or Pay Interest? A Smarter Way to Buy a ₹1 Lakh Phone (www.hindustantimes.com)

This story was summarised and commented on by AI from the source linked above.