Payday Loans

Payday Loans

I’ll be honest, I am not a fan of payday loans, and I will never be. To be fair though, I will present to you what I think the advantages and disadvantages of payday loans would be:


1) Quick money when you need it

2) If used rarely, it can help you navigate through a temporary financial difficulty

3) If you have no credit, the payday loan companies generally will give you financing anyways


1) Repayment terms can be very high, through high interest and fees

2) Frequent use of payday loans will eventually erode your income in the form of charges and interest payable to the payday loan company; making it more difficult to make purchases and payments on other items needing your attention in your home and family

3) Payday loan companies do not report to credit bureaus, and will not help you build your credit score

4) Payday loans can lull you into a false sense of security; as their sheer presence can make you believe you have a financial “out” if you get into a financial bind

So why talk about payday loans? Well, I want to tell you there is a better way than payday loans, pawn shops, loan sharks, instant refunds on your tax returns, or other “quick” ways to get cash. These guys are expensive to use. Even getting an instant tax refund can be expensive. Take a look at your invoice from the company you got an instant refund from, and see how much you paid for that service. As for the others listed, read the fine print in their agreements and see how much interest and other fees and charges they have. You will be astounded as to how fast your money will disappear from you using these guys!

Ask yourself these questions:

Q1: Who can I look to for financial guidance so I can avoid the habit of going to a place like payday loans?

Answer: Look to friends and family (those you know who have good spending and saving habits already); or your financial advisor for financial guidance to help you build a budget and help you navigate through financial difficulties. Do not be afraid to ask for help!

Q2: What can I do to avoid any kind of advance or payday loan?

Answer: Resist the temptation for getting a payday loan in the first place. Second, build a budget! Use our affiliate website: Budget Coach to getting your spending under control, look for ways to increase your income, or a combination of both.

Q3: Where am I going, financially?

Answer: Having a written-out budget in place will help you see where you are spending money, and help you determine what cuts may need to be put into place. Also, look to using money-saving techniques like coupons, perimeter shopping and flyers to purchase key items like groceries, household items, and clothes.

Q4: When can I start a budget so I can avoid this?

Answer: Right now! The sooner you understand your personal financial situation, the better it will be for you! If you need help getting started, find someone who is willing to assist you and help you be “financially accountable”. The “buddy” system works!

Q5: Why I would need a payday loan?

Answer: You won’t if you follow a solid budget, keep to strict spending habits, resist the temptation to overspend, pay down your existing debts (including what you owe for payday loans), and live inside your means.

Q6: How much financial pain will I have to endure if I stop receiving assistance from places like payday loans?

Answer: It truly depends on several factors – your current income level, current expenses, your existing debt load, and current spending habits. All these will play a factor in how much “financial pain” you will endure to stop using the payday loan company. Here I go again: a written-out budget will help you see what you are spending, how much money you will need, and how much you will need to “cut-down” on.

I think by now you see the picture. I hope you do well to learn the art of “living inside you means”, and put yourself on a positive path towards good personal financial control, and eventually financial freedom! Listen to our audio series, you won’t regret it!

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