Is Home Loan Prepayment Worth It?
Prepaying a home loan saves guaranteed interest equal to your loan rate. Investing may earn more if returns beat the loan rate after tax — but with risk. On an 8.5% loan, a ₹2 lakh prepayment can save ₹3–4 lakh in interest over the remaining tenure; use the prepay vs invest calculator with your outstanding balance and horizon.
When prepayment wins
High loan rate (9%+), peace of mind from being debt-free, or no disciplined investment habit.
Near retirement — reducing EMI stress often beats chasing extra market returns.
When investing may win
Low loan rate (7–8%), long investment horizon, and steady SIP discipline.
Keep an emergency fund before large prepayments — liquidity matters.