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By:

C.S. Krishnamurthy

21 June 2025 at 7:45:51 pm

Let Your SIP Fight Your EMI

When Ramesh bought his first home, he was delighted. The keys were finally in his hand, but another number immediately occupied his mind: the monthly EMI. “Now that I have some money left after paying my EMI, what should I do with it?” he asked his financial adviser. “Or should I start investing? And if I invest, won’t I be carrying a loan unnecessarily?” A home loan can run for 15, 20 or even 25 years, while the desire to become debt-free keeps growing. But does a borrower necessarily have...

Let Your SIP Fight Your EMI

When Ramesh bought his first home, he was delighted. The keys were finally in his hand, but another number immediately occupied his mind: the monthly EMI. “Now that I have some money left after paying my EMI, what should I do with it?” he asked his financial adviser. “Or should I start investing? And if I invest, won’t I be carrying a loan unnecessarily?” A home loan can run for 15, 20 or even 25 years, while the desire to become debt-free keeps growing. But does a borrower necessarily have to choose between repaying the loan faster and investing for the future? What if both could be pursued simultaneously? Could a Systematic Investment Plan (SIP) create a corpus that eventually helps reduce or even close the home loan? The idea merits consideration. A SIP is not a magic formula for becoming debt-free, but it can create a second financial track alongside the regular EMI. Two tracks, one objective Consider an illustration. Suppose a borrower takes a home loan of ₹50 lakh at an assumed interest rate of 8.5 pc for 20 years. The EMI would be around ₹43,400.
Instead of putting every available rupee into the loan, the borrower could consider investing ₹10,000 a month through a SIP, provided the household cash flow permits it. At an assumed annualised return of 12 pc, a ₹10,000 monthly SIP could grow to roughly ₹8.24 lakh in five years, ₹23.23 lakh in 10 years, ₹32.22 lakh in 12 years and ₹50.45 lakh in 15 years. While these are not guaranteed returns, the possibility of higher returns is also not ruled out. Meanwhile, the outstanding home loan would gradually decline through EMIs. Over eight to 10 years, the SIP corpus could become substantial enough to give the borrower an additional financial option. The important point is not to decide today exactly when the loan will be closed, but to review the position when the time comes. Why not simply prepay? Prepaying the home loan provides a relatively certain benefit because every rupee of principal repaid reduces future interest outgo, subject to the loan terms and applicable rules. The SIP serves a different purpose. It creates a financial asset and, over the long term, gives the investor an opportunity to participate in the growth potential of financial markets. The decision point comes later The strategy need not have a fixed finish line. After eight to 10 years, the borrower can review the situation rather than mechanically redeeming the SIP. What is the outstanding loan, the investment value and its performance? What are the prevailing market conditions? Is part-prepayment more appropriate than full repayment? These questions can guide the decision. If the corpus has grown sufficiently and circumstances are favourable, the borrower may consider using part of it to reduce the outstanding loan or, if appropriate, redeeming enough to close the loan completely. If the investment is better retained for the long term, there is no compulsion to exit merely because 10 years have passed. The strength of the strategy lies in this flexibility. Think beyond the loan A long-term SIP is not merely a future home-loan repayment fund. It can become a wealth-creation vehicle in its own right. Compounding rewards patience. A disciplined monthly investment held for the long term can help build a corpus for retirement, children’s education, other life goals or financial independence. Thus, while the home loan moves towards closure through the EMI, the investment has the opportunity to grow alongside it. Once the loan is eventually closed, the EMI disappears. Instead of allowing that money to quietly disappear into lifestyle expenses, the borrower can redirect some or all of the former EMI towards investments. A sensible balance This approach is not a universal prescription. Some borrowers may prefer aggressive loan prepayment, while others may find the combination of EMI and SIP more suitable. The SIP amount should also be comfortable. If ₹10,000 strains the monthly budget, start with less. The strategy should strengthen financial security, not create financial pressure. Adequate emergency savings and appropriate insurance should also form part of the overall financial plan. The larger lesson is simple: a home loan need not automatically put wealth creation on hold. With disciplined cash-flow management, a long-term investment approach and periodic reviews, the EMI can continue paying for today’s home while the SIP works towards tomorrow’s financial freedom. In the end, the question need not be, “Loan or investment?” It can be: “How can I use both wisely?” Disclaimer: “Mutual funds are subject to market risks. Read all scheme-related documents carefully.” (The writer is a retired banker and author. Views personal.)

DPS Lake turns into algae reservoir

Writer: Bhalchandra Chorghade
Bhalchandra Chorghade
Aug 28
2 min read

Greens urge CM to make it flamingo-ready

Mumbai: Environmental groups have urged Chief Minister Devendra Fadnavis to expedite the process of granting conservation reserve status to the 12-hectare DPS Lake in Navi Mumbai, warning that the wetland is rapidly deteriorating and could become unsuitable for flamingos and other migratory birds.


The appeal comes ahead of the next World Migratory Bird Day, observed on the second Saturday of May and October to highlight the seasonal movement of migratory bird species. Environmentalists have called for urgent measures to restore the lake’s ecological health and make it suitable for flamingos by October.


In a fresh representation to the Chief Minister, NatConnect Foundation said DPS Lake had increasingly turned into an “algae reservoir” and was becoming filthy due to the continued obstruction of intertidal water flow by the City and Industrial Development Corporation (CIDCO).


The State Wildlife Board has already passed a resolution recommending that DPS Lake be declared a conservation reserve. However, the final government resolution has been awaiting clearance from the Chief Minister’s Office since October last year.


Information obtained by NatConnect under the Right to Information (RTI) Act showed that the Forest Department had submitted its detailed proposal to the Chief Minister’s Office in October 2025, but the approval was still pending.


NatConnect Foundation director B N Kumar and Palm Beach Greens convenor Shrikant Patki, who inspected the wetland on Thursday, expressed concern over its deteriorating condition.


“The government’s own proposal cannot be held ransom to the commercial interests of CIDCO,” Kumar said, alleging that the planning agency had proposed real estate development in the wetland despite its ecological significance.


Kumar said DPS Lake served several important ecological functions beyond providing a habitat for birds. The wetland helps absorb excess water and acts as a natural buffer against flooding in the neighbouring NRI Seawoods area and around DPS School.


Environmentalists said implementing the Wildlife Board’s decision would provide a framework for systematic conservation and maintenance of the lake and facilitate restoration of the natural flow of intertidal water.


Patki said the government should ensure that the decision of the Wildlife Board was implemented without further delay. “Restoration of the free flow of intertidal water is essential for the ecological revival of the wetland and its use by flamingos,” he said.


DPS Lake, along with the NRI and T S Chanakya wetlands, forms part of the ecologically significant wetland complex associated with the Thane Creek Flamingo Sanctuary, a Ramsar-recognised site. Flamingos and other migratory birds use these wetlands as high-tide roosting sites.


The State Forest Department has also highlighted the importance of protecting these water bodies as part of the larger Thane Creek ecosystem, the green groups said.


Environmentalists also linked wetland conservation with aviation safety at the Navi Mumbai International Airport (NMIA). Kumar cited concerns raised by the Bombay Natural History Society (BNHS), saying that destruction or degradation of traditional bird habitats could alter bird movement patterns.


“If wetlands traditionally used by birds are destroyed, birds could move unpredictably towards mudflats and other water bodies closer to the airport, potentially increasing the risk of bird strikes,” Kumar said.

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