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First Online Loans
3 Jun 2019

What Is a Good Age For Your First Online Loans?

As you get older, you’ll probably find yourself facing more and more situations in which money is tighter than you expected. You’re probably already familiar with the concept of online loans as well. It might seem like a natural fit to put these two ideas together and solve your cash flow issues with loans, but doing this may not necessarily be a good idea. Not every younger person is ready to take on the massive responsibility of a loan, but some might be. If you’re interested in getting one for yourself, you’ll need to figure out if you’re of the right age to make this huge financial move. We’ve listed four steps below that will help you work through the answer to this question for yourself.

First, Assess Your Means

The first thing you need to consider during this process is whether or not you truly have the means to borrow money right now. If you don’t have a steady job or consistent income, it can be extremely hard to justify even trying to get a loan – and that’s leaving aside the countless issues you will surely face when trying to get approved. Many young people work part-time or for low wages, and it’s becoming increasingly common to work in the highly unstable gig economy too. All of these things make it hard to add loan payments into your budget or even to reliably predict how much money you’ll have available to you each month. When any miscalculation means that you may not be able to make the payments that you owe, that’s a very significant problem that you’ll want to pay attention to.

Any shred of an issue at this stage means it’s best for you to just abandon this idea right now. Taking out loans you won’t be able to repay is a bad idea for both you and any potential lenders you might have applied to borrow from. You’ll get yourself even further into debt, lose out on more disposable income and maybe even wreck your credit score at the same time, setting you much farther back in your credit journey and doing damage that it will take years to undo. You can always come back to loans when you’re more established and can reasonably expect to be able to pay them back, but for the time being, you may still be too young.

Next, Determine Your Needs

The next thing you need to do is think about whether or not you really have any need for the money you’re seeking. What are you intending to buy with the money from your online loans? Perhaps more importantly, what do you want to do with that item or service? Can you wait for it, or do you truly need it right now? If you’re going to go ahead with borrowing, you’ll need to settle on answers to all of these questions. Money that you borrow will always come at a cost to you, so it should never be drawn upon without a specific purpose for it. Ideally, you shouldn’t be using it for anything but the most indispensable of necessities, but you can also get away with using it for leisure when you have grand plans for it, such as a special holiday or a gift that a loved one has been asking about for years.

Most younger people do not have many extensive or urgent needs because they just haven’t had the time to encounter that many emergencies. That said, there are a few things that they are disproportionately more likely to need. Things like a car to get around on your own or furniture to make a new apartment into a home are not free, but you do need them and may not have access to them when you’re first starting out. Things like that are legitimate needs, so don’t feel that you have to be dismissive of them when you’re thinking about this. As was mentioned, it’s not out of the question to have fun with the money as well, as long as you plan to really make it count. You should decide on your purchase with the seriousness and decorum that a matter of this level of importance deserves.

Then, Map Out Your Future

After you’ve figured that out, it’s time to move on to some more abstract thinking. Just because a loan seems workable or affordable in your present circumstances doesn’t mean you will necessarily still be in that same situation in the future. As a young person, you have a lot of your life still ahead of you, and many of the major milestones you might be planning on hitting will cost a lot of money. Do you want to buy a house in the semi-near future? What about getting married, or having children? Going back to school? Even something as simple as a larger car payment can throw your finances off drastically compared to where you were when you were first contemplating taking online loans, and it’s important to factor those possible changes into your decision-making so that they don’t completely upend your efforts later.

Limiting yourself by taking on too much debt too soon is one of the worst things you can do to your future self. Many of these big life events involve taking on debt in some way. The more loans you have, the fewer you will be able to get later on when you might really need them. Even if you do manage to be approved for them, thanks to the other payments you’re making, you may not have the cash flow that you need to pay them back without incurring hardship. That can put an end to those types of plans as surely as being denied might have done. Significant debt also tends to reduce your overall happiness in life. You don’t want money problems to stop you from doing what you really want to do in life. Make sure that you think things through before you do anything in this regard and you’ll be thanking your future self later.

Finally, Take An Honest Look At Yourself

As we mentioned above, online loans are a big responsibility, and they fall on your shoulders alone. A big part of what goes into determining if you’re ready for this is your own self-confidence and ability to manage your own affairs. Just one small slip-up that wouldn’t have much of an impact in many other scenarios can create huge damage to your financial stability. Not everyone handles responsibilities the same way even when they are technically the same age, but younger people in general tend to have a harder time sticking to their commitments over the long term and should be extra wary of any potential pitfalls on their part. Not only is the likelihood of an issue coming up somewhat higher, but you’ll also suffer greater consequences if it does due to the amount of your lifetime that is still in front of you.

Think about how you handle other big challenges in your life, or if you’ve really had to handle any at all up until this point. If you’re relatively untested, it might be best to stick with a small loan only for the time being regardless of what you could qualify for, if any at all. However, if you’re used to shouldering many burdens and know what it’s like to have to stick to a deadline or face the consequences, you might be able to handle online loans that are quite a bit larger. This is the most personal of all the factors that go into determining if you’re of a good age to borrow, so only you can decide where you fall on that scale. Just make sure to keep things honest when you’re thinking this one through. It’s too easy to lie to yourself if you’re not specifically intending not to do so, and that could have vast unintended consequences in this case.

If You’re Ready To For Online Loans, We Can Help

The ideal age at which to start to borrow is different for everyone. Provided you’ve thought through all of the steps in the process above and have come to the conclusion that you measure up to the standard of a good borrowing candidate, you can confidently take out online loans whenever the mood strikes you. With so much freedom at your disposal, why not do your investigating now? One quick look at Bonsai Finance’s web search tool can tell you all you need to know about the lenders that fit your desired criteria and what they have to offer for you. Even if you’ve never taken out a loan before, you’ll have an easy time during this process if you rely on our expertise to help you through it. Trust us – helping Canadians like you with their everyday loan needs is what we do, and we’re very good at it.