otsetermilise

Otsetermilise is an Estonian term that translates to "direct financing" or "own financing." It refers to a method of funding a project or purchase using one's own accumulated capital rather than relying on external loans, credit, or other forms of debt. This approach is common in both personal finance and business contexts.

In personal finance, otsetermilise might be used for major purchases such as a vehicle, a home renovation, or even the down payment on a property. Individuals who have saved diligently and have sufficient funds can avoid interest payments and the ongoing obligation of loan repayments. This can lead to greater financial freedom and reduced risk.

For businesses, otsetermilise can involve using retained earnings, profits from operations, or the sale of assets to fund new ventures, expansion, or capital expenditures. This strategy can offer advantages such as maintaining full ownership and control, avoiding restrictive loan covenants, and improving the company's balance sheet. However, it also means that available capital for other investments or operational needs might be tied up. The decision to use otsetermilise versus external financing depends on a variety of factors including the availability of funds, the cost of borrowing, the risk tolerance of the individual or business, and the potential return on investment.