Are you one of the over 12 million Americans who will take out a payday loan this year?
If yes, your situation is understandable. At a time when a vast majority of American workers are living paycheck to paycheck, any slight emergency can leave you needing to take out a payday loan.
While payday loans can help you get out of a jam, their ability to drive borrowers into vicious debt cycles is well-documented. The interest alone is sky-high.
This is why everyone who’s looking to consume these products needs payday loan advice. In this article, we’re serving plenty of it.
A Payday Loan Should Be a Last Resort
It’s normal to get into a financial jam once in a while. It happens to everyone.
However, the difference between a financially savvy person and a financially reckless one is what they do when they get into this jam. If you’re savvy, you’ll avoid taking a payday loan because of the high-interest rate and short repayment terms. If you’re reckless, you’ll grab the first opportunity to get a payday loan.
To keep your finances out of troubled waters, avoid taking out a payday loan. If you must, ensure it’s a measure of last resort.
Sure, it’s easy to fall for these loans when you’re in extreme financial pressure. Perhaps you need cash with the next hour and, you guessed it, only a payday loan will avail the funds that quickly.
In such times, it’s advisable to consider other options first. Maybe talk to your close friends? Ask your bank if you can get a quick salary advance?
Either way, payday loans aren’t your friend. Avoid them.
Hunt for the Best Payday Loan Deals
Just because payday loans have a bad reputation for charging exorbitant rates doesn’t necessarily mean there aren’t lenders charging reasonable rates.
The payday lending market is vast, filled with thousands of lenders across the country. When you’re absolutely sure that you need this loan, try and get the best deal.
Since most of these loans are offered online, use this to your advantage. Compare loans offered by multiple lenders and settle on the one with the most favorable terms. This way, you won’t lose as much money as you’d lose when you take a payday loan charging higher interest.
Organize Your Finances and Save for a Rainy Day
Yes, the economy is stiff and paychecks are stretched thin. But as an adult, you have a duty to organize your finances and save for a rainy day.
Embrace a frugal lifestyle. Take up a side hustle. This way, you’ll have more disposable income, which you can put into your rainy-day fund.
If you’re self-employed, keep track of your income, especially if you got multiple hustles. You can use a software like Paystub Creator to keep an eye on every dollar coming into your pockets.
With good financial organization and a healthy rainy-day fund, you’ll be able to ride out any financial storm without needing to take out a payday loan.
Embrace This Payday Loan Advice
Payday loans can get you out of a financial squeeze, but they can also destroy your financial life. Millions of people are trapped in debt cycles because of these loans.
With this payday loan advice, you now know how to avoid getting your finances into troubled waters.
Keep reading our blog for more tips on personal finance.