Home loan at 25? Should a 25-year-old take a Rs 30 lakh joint home loan or focus on liquidity, investments?

I’m a 25-year-old from Chennai and earning about Rs 1.37 lakh per month post-tax. My parents want me to take a Rs 30 lakh home loan to buy an apartment, with Rs 10 lakh as down payment, partly contributed by my sister. The property would be jointly owned with her, though we are not very close, which makes me uneasy. The plan is to take a 20-year loan, where around Rs 20,000 of the EMI would come from rent and I would cover the rest. 

However, I’m already investing Rs 20,000 a month, supporting my parents with another Rs 20,000, and managing personal expenses and other EMIs. From a financial and risk perspective, is this a prudent decision, or should I prioritise liquidity and long-term investments instead?

> Advice by Anshi Shrivastava, Head - Personal Finance Training at 1 Finance

1. While more details on your current loan repayments and exact living costs would help show if those areas can be optimised, the reality is clear: as per the information provided, your budget is already stretched thin, reducing your safety net for unexpected events such as job loss, health issues, or sudden family needs. Your current monthly commitments already consume most of your 1.37 lakh rupees post-tax income.

2. Another important point to keep in mind is that, as financial ties with family can amplify existing tensions and create new ones that disrupt your emotional well-being, this decision deserves extra caution. I cannot help but notice that you are not very close to your sister and that the idea of owning a property jointly with her already makes you a little uncomfortable. That feeling is important and should not be dismissed.

For instance, one day if one of you want to sell the flat but the other does not agree, it could lead to prolonged legal or family conflicts that drain both money and peace. Or if unexpected repair costs arise and opinions differ on how much to spend or who pays what, it can build resentment and ongoing stress. Always remember, true security and peace of mind come from keeping your finances independent, with sufficient emergency funds, and free of uneasy family partnerships, rather than rushing into property ownership that might keep you anxious for years.

3. The EMI of Rs 30-lakh home loan will be around Rs 26,000. Even if rent covers Rs 20,000 most months, you are still left with extra pressure. More importantly, there is no guarantee the property will always have a tenant. If a tenant leaves, the full responsibility of paying the entire instalment falls on you alone.

What are the alternatives?

1. Continue investing aggressively in mutual funds.

2. Build an emergency fund that covers at least six months of your expenses.

3. Delay buying a house for a few years. By then, your income is likely to be higher, the loan will feel much lighter. In the meantime, consider adding Real Estate Investment Trusts (REITs) to your portfolio. REITs give you exposure to real estate income and growth without the hassles of owning physical property, managing tenants, or dealing with loans.

What should you do?

Skip the loan. Protect your peace, freedom, and financial flexibility first. Wealth grows faster and more sustainably when you stay calm and fully in control.

 (Views expressed by the expert are his/her own. E-mail us your investment queries at askmoneytoday@intoday.com. We will get your queries answered by our panel of experts.)