The way we spend our money is a personal matter and while it is recommended that we spend responsibly, it is our right to do whatever we please with our income and savings. Many Americans use budgeting tools to make sure that they have enough money to pay bills and take care of all of their financial obligations in a timely manner. Oftentimes, that is just not enough and many must turn to loans to bridge the gaps that crop up when emergencies happen or we fail to earn enough to get by. Bank loans have low interest rates and you can get them from the bank you use, but they are often fraught with regulations and requirements that most do not want to deal with to borrow a few hundred dollars until their next payday. You must have impeccable credit and you will often need to pledge some sort of collateral to secure the loan, which can be a hassle.
When we spend very close to our limits, we can often get hit with an overdraft fee from our bank. These fees are per transaction and can really add up if we are not in full control of our finances. Even if the item we buy with our debit card is less than a dollar, we could end up with a $30 fee for that transaction alone resulting in an avalanche of fees that we often cannot pay for quite some time. Payday loans can help us in situations such as this and are available online as well as at cash advance stores in our local area. Many are against the use of these types of loans, but their fees can often be much less than multiple overdraft and NSF fees that we would accrue otherwise.
The key is to only use a payday loan in an emergency when we know we will have sufficient money to pay it back with no financial strain. Payday loans are just one option in the struggle to get our finances on track and should be used for financial emergencies such as late utilities or when we know we will go under our bank balance. A quick deposit of cash from the payday loan can prevent that avalanche of fees from the bank. Banks make a large percentage of their overall profits from fees including overdraft fees, so they have an incentive in pointing the finger at the payday loan industry, but should take a cold hard look at their practices before making any judgments.