Pocket Money - SEBI Investor Awareness Website - Securities and ...

Q-RIOSITY“One that goes a – borrowing goes a sorrowing”— Benjamin FranklinIs borrowing always bad? _______________________________TO B OR NOT TO B : TO BORROW OR NOT TO BORROWLet’s consider the cases of two friendsCase of ShatishAbout a year back Shatish took a loan of Rs.10,000 to buya new cell phone costing Rs.11,990. Today he finds that theprice of that cell phone has come down to Rs.6,999.Now he is wondering why he took a loan. He should havesaved money to buy the cell phone – so that he would notonly have got the cell phone at a lower price but also havesaved the money that he had to pay towards interest on theloan. In addition, he would have earned some interest on themoney that he would save!Case of AshishAbout two years back Ashish was looking at a proposal tobuy a 2BHK (Two-Bedroom-Hall-Kitchen) accommodation. Hedropped the idea as neither did he have the money to buythe property nor was he prepared to take a home loan.Now he finds that the price of the same property has goneup. He is wondering why he did not take a home loan andbuy the property at that time! If he had availed a home loan82