Your first credit: How to decide when to use it?

Although loans are one of the most common financing instruments that exist, people often end up experimenting with credit cards first. On average, the age at which the Spanish apply for a loan for the first time is 26 years, but due to the technology and the different financing options that are appearing, this is changing and the ages are decreasing. 1 in 10 young people between 18 and 24 have already applied for a loan.

 

Most of them start with a credit card

Most of them start with a credit card

Since many entities usually give credit cards to young people who enter the labor market by domiciling their payrolls at the bank. So, when you already have a card, care must be taken to decide when to use it and when it is necessary to apply for a personal loan, especially if it is the first one you will request.

The key point you should consider is that interest rates on personal loans are more comfortable than credit cards, that is, you will pay less when financing your acquisition in more installments. However, obtaining it requires a request, while the use of the card is a more direct mechanic.

 

So how to decide?

So how to decide?

Basically, personal loans are ideal when you will make some major expenses that, to be met, must be financed in several installments, for example, 10 or 12. In this sense, using a loan would be cheaper than your card, not just because you don’t You would use up your entire line of credit, but because the interest would be lower.

Here, although applying for the loan may require a little more time, it is worth investing, as it is the right type of financing to meet your needs. For example, it could be a trip abroad, the acquisition of a high-price appliance, renovation of some area of ​​your department, etc.

Something you should also consider before applying for your first loan is that interest rates vary from entity to entity. Not only banks are available, but also cash and banks. To find the most competitive option, you just have to compare the alternatives in specialized sites likee Garndice family and you will check which one is ideal for your profile and pocket.