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Top Tips on How to Pay Back Your Personal Loan

BY Team Loanstreet

Updated 18 Nov 2019

Taking a personal loan these days has been a common part of our finances and it often allows us to do so much more in terms of solving our financial situation or emergency fund, which usually we couldn’t afford to pay in one lump sum.

One of the key areas to look for when taking a personal loan is your monthly repayment amount, and you should think carefully on how this repayment amount will affect your lifestyle for the duration of the loan which can be up to 5 years. Let’s find out how you can pay off your Personal Loan with Loanstreet’s Top Tips.

What's covered in this article?

1. Be thrifty by reducing your cost of living

Being able to save money is the first step to better secure your financial well being in managing your hard earned money. Your savings provide the ability to deal with any emergency situation, solving them independently and lending help to your loved ones.

If you are able to do this gradually, you will end up having money to repay your loan steadily. You should start with looking at ways to shop cheaper, getting the right credit cards with rebates, reducing your entertainment budget and make smarter choices in choosing what you need, not all that you want.

Lifestyle spending comparison for “Normal Spending” vs “Reduced Spending”

  Normal spending (per month) Reduced spending (per month)
Food Normal spending (per month):RM330 (RM5.50 per meal, 2 meals per day at a kopitiam) Reduced spending (per month):RM200 (Home-cooked meals)
Rental and utilities Normal spending (per month):RM550 (Master room)

Reduced spending (per month):RM300 (Small room)

*Sharing a room will be 50% less cost


Normal spending (per month):RM300 (Driving)

*Estimated cost for petrol only, excluding car maintenance and monthly installments

Reduced spending (per month):RM100 (Using public transportation)
Entertainment Normal spending (per month):RM200 Reduced spending (per month):RM100
Cigarettes Normal spending (per month):RM255 (RM17 per pack, 15 packs per month)

Reduced spending (per month):RM68 (4 packs per month)

*Quit smoking to save money and your health altogether

Smartphone bill Normal spending (per month):RM80 (Example: Dxxx postpaid plan) Reduced spending (per month):RM58 (Example: Dxxx postpaid plan)
Miscellaneous expenses Normal spending (per month):RM100 Reduced spending (per month):RM50
Total Normal spending (per month):RM1,815 Reduced spending (per month):RM876

From the comparison chart above, it shows that you’ll be able to save RM939 per month if you reduce the cost of your lifestyle spending in all areas. Surprisingly, the savings could make up almost 50% of your normal spending!

These savings will be useful during your repayment period for your personal loan, and you will most definitely be able to pay off or get a bigger loan amount of up to RM40,000 with RM934 repayment each month for 5 years (you'll still have RM5 left over!).

You’re never too late to reduce your cost of living, and you have the choice of doing this only during your repayment period!

2. Create budgets and record your expenses

If you fail to plan, you plan to fail. While planning, you should start using a finance/budget app with your mobile phone or your laptop. By recording your expenses and knowing how much you’ve spent your money on all categories of your lifestyle, you can plan better for next month by creating budgets for each categories. This will ultimately lead you to reduce your cost of living, and plan ahead for next month by studying your past expenses monthly.

For example, by having these records on your finance/budget app, you can foresee all the yearly charges for your car insurance, medical card renewal, fire insurance, property assessment tax and many more. You also can rely on setting up recurring charges on your finance/budget app so you know how to plan and prepare to pay for these extra expenses.

3. Avoid this common mistake, only opt for full settlement with rebate

Car and Personal Loans offer Flat Interest, therefore you pay interest on the entire loan balance throughout the duration of the loan. So it makes sense that you don't pay extra each month or shorten your repayment period as this is the common mistake we all usually do, because you won't be saving anything on interest charges.

But if you have enough money in your savings to settle your loan balance all at once, then you should use our Car & Personal Loan Settlement Calculator to calculate how much rebate you can get from this settlement. Although it's a complex calculation, our calculator simplifies it with a Mortgage/FD Interest Rate savings for your full settlement by percentage. 

So you'll be able to consider this with the actual figures and decide carefully, after all the rebate you'll get should make you feel good and proud of finishing off your personal loan!


If you’re willing to make adjustment wisely, you’ll definitely be able to pay back your personal loan. As a matter of fact, you’ll become a better planner with such experience for your future financial management.

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About the Author

Team Loanstreet

Run by a professional human-sized team, get resourceful tips & guides from our very own library of financial articles that can help improve your financial lifestyle & make a well-informed money decision. We strive to provide you with the best service in helping you to get the most out of that DUIT!


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