How much percentage of salary should be EMI

It is very important for you to know how much percentage of your should be EMI. Because you know many people and yourself fall into that category that you always struggle with money every now and then. So it is crucial to keep aside only some amount of percentage for any EMI you are going to take or you have.

Why it is important to keep only percentage of EMI?

There might be lots of reasons but some of the most important reasons are to put only a particular amount of money in EMI otherwise it can cause you financial disasters.

  1. You have a limited amount of amount and you always struggle to live with your 100% salary. If you give more than half of your salary how will you survive?
  2. Stress, anxiety, and depression will not give you space to enjoy your life.
  3. It can seriously put you in danger might you need to unnecessary unsecured loans for needs and all these.
  4. If you don’t plan your EMI, the EMI will wipe your account and you won’t understand.
  5. You might go broke financially.

How much percentage of salary should be EMI?

You can get the help of the 40 % EMI Rule. Again this is not the only rule that you can apply. But yeah it will go well for a novice. So according to the 40% EMI Rule, you can’t spend more than 40% of your income on EMI.

So assuming you earn 50,000 Rs per month. In this case, you can’t spend more than 20,000 Rs on EMI. Because tell me if you were struggling with your 50,000 salary now if you give an EMI of 20,000 Rs every month you are left with 30,000 Rs to fulfill your needs, wants, and other important expenses.

Bonus Tips

  1. That’s why what you can do is try to get as much low EMI as you can pay.
  2. If not necessary avoid taking EMI.
  3. Increase your salary
  4. Clear as soon as possible your EMI
  5. Stop your wants unless your EMI is cleared

It will be very good the lesser the percentage of your salary is going towards EMI it will be much better for you so that you can save more and invest more.

How to plan your EMI?

Know Your Financial Situation

Calculate your gross monthly income. Determine your existing financial obligations, including any outstanding loans or credit card debt. Consider other fixed and variable expenses, such as rent, utilities, groceries, and transportation.

See which loan is better for you

Research and compare different loan options available in the market. Consider factors such as interest rates, loan tenure, and processing fees. Choose a loan that aligns with your financial goals and has favorable terms.

Laon Duration

Decide the loan amount based on your needs and budget. Choose a suitable loan tenure that balances affordable EMIs with a reasonable repayment period.

Calculate EMI

Use online EMI calculators or formulas to estimate the monthly installment based on the loan amount, interest rate, and tenure. Ensure that the calculated EMI is within a comfortable range of your monthly budget.

Down Payment will

If applicable, factor in any down payment or initial contribution you need to make.
A higher down payment can lower the loan amount and reduce the EMI burden.

Emergency Fund

Plan for unexpected expenses and emergencies in your budget. Maintain a buffer to accommodate any fluctuations in income or unforeseen circumstances.

Don’t exceed your debt column

Ensure that the total of all your EMIs does not exceed 40-50% of your gross monthly income. Avoid overcommitting to debt, leaving room for savings and other financial goals.

Read the Terms and Conditions properly

Read and understand the terms and conditions of the loan agreement.
Be aware of any penalties or charges associated with late payments or prepayment.


Develop a systematic plan for repaying the loan. Set up automatic transfers or reminders to ensure timely EMI payments.


Regularly review your financial situation and adjust your budget as needed.
Consider making prepayments if you have surplus funds to reduce the overall interest cost.

Get the help of a Financial Advisor

Consult with a financial advisor to get personalized guidance based on your specific circumstances. Address any concerns or questions you may have about the loan or repayment plan.

I hope you like the post “How much percentage of salary should be EMI” and that you will implement it in your life to see a better result.

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