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Tags: finance, payday loans, payday loan
 You come home from work, only to find out that you've spent your last 15 bucks on beer and smoke. Opening your fridge, you find out that you've only got a piece of chicken left, but days old (you should be feeding it to your dog). To make things worse, it's the only thing that's going to get you through the night.
Your pay isn't due till next week, and the guys that you thought were your friends, won't lend you any money – not even your parents. So what's left for you to do, chum? Well you could opt for a payday loan – a very popular concept amongst people with low-paying jobs.
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Here's how it works: it functions like a cash advance (it's actually termed as cash advance as well), in which people avail for purposes of their own, since their pay isn't due anytime soon. The views of this type of loan vary from person to person – there are good points and a lot of bad points to it.
First of all, let's take a look at the better side: payday loans are easy to avail. There isn't any need for filling up tons of papers. They're also fast to process, you can get the desire amount of money within minutes. Lastly, they come in handy for times when you really need it.
An example would be buying grocery items and food because your literally broke, just like the guy we talked about in the story earlier. Lastly, the lenders don't really pay much attention to your credit history or credit score for that matter, unless it's really that bad – sounds too good to be true, yeah? Think again: if you thought that paying the interest on your credit cards was plenty, wait till you get a load of this - according to the Federal Trade Commission (FTC), the Annual Percentage Rate (APR) can reach up to a whopping 391%! I don't know about you, but that does seem a little above average, don't you think? That's why many people they feel that availing a payday loan isn't the wisest of ideas you can up with.
The fact doesn't apply to every loaning company, but it does to many, so it's best that you come up with better alternatives then to make this one as your only or first choice. That kind of Annual Percentage Rate is unbelievable, and kinda makes them seem like legalized loan sharks.
Heck your probably better off having them break all your digits if that's the numbers they come up with. Anyways, what are the better ways for you to go about this without a payday loan? Having a credit card would be a possibility – the APR here is much lower, but you should look for one that's a bit more “fair” as compared to the others.
What you wanna do is save money, but putting it in an easy-to-break piggy bank in your cabinet isn't a good idea. But what you can do is open a bank account, from here you could make consistent deposits to that account, and withdraw during a “rainy day”. There are other creditors out there that'll be more than willing to work with you on your debts, so knowing them and the APR they charge could also come in handy.
About the author
The author of this article Rick Goldfeller is a successful underground Financial Analyst who has been advising and coaching individuals for many years. Rick recently published a book on how to manage your money and attract Wealth and Financial Freedom. More info on his Finance Planning course is available HERE.
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