Smart alternatives to payday loans

Payday loans are the quickest and most convenient form of loans. They are very tempting when you have financial emergencies. All you need to do is apply online for a loan and receive the money within a few minutes. People do not realise that payday loans have high interest loans and you can suffer serious consequences if withdraw the payments even a few minutes after the deadline.  Unable to keep up with late payments, many face excessive penalties and additional fees. If you are in need of a loan, here are some alternatives.

Ask for a loan from friends and family. They are more likely to provide you with a loan without much screening. Most friends and family will not impose any interest on the loan. The time limit for loan payment is much flexible when it comes to friends and family. They are less likely to pressure you when they know you have financial struggles

You can ask for an advance from work.  If your company policy allows it, you can take advance salary. This is a smart option because you won’t have to pay the loan back.  The only repercussions are that you won’t get your full salary in your paycheck at the end of the money. If you use the money wisely, you won’t have to ask for another advance in the next month.

Use your credit card as a loan option.  Just like conventional loans, credit cards are hard to obtain but their risks do not compare to those of payday loans.  Instead of a payday loan, apply for a credit card. Within two weeks or less you will have your credit card. You can use it to purchase goods and services.  Make sure you pay your credit on time to avoid a negative credit report. With a bad credit report you will have it hard trying to get a credit card.

Take some of your emergency funds. If you have a loan set aside, you can use some of it, especially when you are having a financial emergency. If you have enough money in your savings account you can use it all and save more later. With emergency funds, there are no interests because it’s all your money.  If you don’t have enough money in your emergency account you can find ways to make quick money. Garage sales and taxi driving are the easiest way to make money fast.

Borrow from your life insurance policy or retirement benefits.  If you have been saving on a life insurance plan, you can take a loan.  This loan has no payment deadline and if you don’t pay the whole loan, it is distracted from your death benefits. Money loaned from the insurance policy is to paid back fully with accumulated interest. Borrow from your retirement if you only need a small amount and you are sure to pay it back fast. When you pay back the loan, the interest is directed to your account.  The time limit for this loan is within 5 years.