Cash crunch? How to prioritize payments?

It sometimes happens that we are short of cash. Some unexpected expense or sudden loss of income is something that all of us face at some point of time. If you ever find yourself in such a situation and have to prioritise your payments, here is a list:

Mortgage: A roof above your head is the biggest security you can get. Make sure you and your family has it all the while. So, do not miss your home loan EMI. Missing an EMI on your home loan could also affect your Cibilreport. Cash crunch is a temporary phase, but an impact on Cibil score could last longer.

Insurance premiums: People frown at the mention of insurance premium payment during financial crunch. But this should be considered as an important investment, because at a time of financial duress if something happens to you, your financial mess can increase exponentially.

Car loan payment: If your auto loan EMI is still on, this should be on your list of payments too. Missing on an auto loan repayment could also impact your Cibilcredit score. With that in mind, ensure your car loan EMI is also accounted for.

So, at a time of financial duress, do not let emotions make decisions for you. Think through every action of yours and every payment you have to make. Take a wise decision.

The author is Co-Founder & Director, CreditVidya