A Payday Loan Isn’t a Cure-All Solution

Payday loans are so easy to get these days that you must be careful not to get in over your head. A payday loan isn’t always the right solution to your money problems. As a consumer you must take the time and sit back and determine whether you really need to take that step.

Here are a couple good examples of when to use a payday loan:

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You have an important bill that needs to be paid this week. If you were going to pay that bill with your next paycheck, then a payday loan could be a viable solution (providing you have enough income to cover the loan and the fee).
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You have an emergency car repair that is going to cost a small portion of your next paycheck. You could obtain a payday loan for the repairs knowing that you will have money left in your next paycheck for daily expenses.

You should not use payday loan for these circumstances:

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To go on vacation
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To go to the casino
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To buy a gift or splurge on an expensive product

Always beware of a payday loan company that offers you a loan larger than your paycheck. They are just trying to get you in that revolving debit loop. If you pay only the required fee, they will extend repayment for another term with an additional fee. This is not a good idea. Under no circumstances should you carry the loan over. Try to pay more than just the basic fee.

Here’s a few questions to ask yourself when determining if you should get a payday loan.

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Is it truly an emergency situation?
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Can I pay back the loan immediately?
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Am I prepared to be short that amount of money through the next pay period?

A payday loan is not a cure all solution to your financial situation. You are essentially borrowing money from your next paycheck so you must make sure you always think it through before taking that step. If you foresee yourself needing another payday loan to pay off the current one, don’t do it. If you were going to use your paycheck for the reason you’re getting the loan, then find a reliable company with low fees.