An alternative to payday loans

In today’s tight economy, getting a bank loan is not always an option. The only quick cash withdrawal seems to be in the form of a short-term, high-interest payday loan. If properly managed, these loans can serve a purpose in a time of need, though they often lead to a fee cycle if not paid on time. filled quickly.

There are nightmare stories of people in debt on payday loans for years, paying only ‘renewal’ or ‘transfer’ fees. Many still owe the same amount as the day they took out the loan. Pretty hard to swallow. The only way to avoid the payday loan debt trap is to plan and save. We can save in many more areas of our lives than we consider. Hopefully, the following money-saving tips will help you save some money and avoid payday loan debt or get out of it faster if it’s too late.

Tips to save money and avoid payday loan debt

In general Plan your budget. List all sources of income and your regular expenses. Take a look to see what you can reduce. Shop around for better deals (for example, shop around for auto insurance).

Bring your lunch instead of buying it every day.

Pay yourself first. Every month, try to save at least 5% of your take-home pay. Increase that percentage whenever possible. Set goals. You’ll want to save more if you know exactly what you’re saving for.

Avoid impulse purchases. Think about whether you need something before you buy it. You’ll be surprised how much you can save by being disciplined.

your credit Be aware of what is on your credit report. Request a credit report online, but be sure to do your research before ordering. Some companies charge hidden fees, so be sure to read the fine print. Check your credit report for errors.

If you find an error on your credit report, report it to the credit bureau. If you have a dispute, the credit bureaus will investigate the report. The offices will give their determination. You may qualify for lower interest rates as your credit improves and your debt is reduced.

The average interest rate charged for unsecured subprime credit cards is 20.73% compared to an average rate for prime or mid-market cards of 14.22%. Reduce your ATM fees. Use your bank’s ATM instead of another bank.

The average cost of using another bank’s ATM in 2005 was $2.50 (consumerreports.org/May 2004). Cash advances are expensive. Avoid borrowing cash on your credit card in any case. Cash advances generally have a higher interest rate than regular fees and do not have a grace period.

For seniors Senior Discounts Take advantage of discounts offered by department stores, restaurants (eg, early bird specials), and theaters. Senior Real Estate Discounts If you are a senior, you may be eligible for real estate tax discounts offered by your local government.

for your car Consider dropping auto collision and comprehensive coverage if premiums cost more than 10% of an old car’s value. Increase your auto insurance deductible to lower your premiums. Increasing your deductible from $200 to $1,000 can lower your auto premium by 40% or more.

Just remember that if you are in an accident, you are responsible for the deductible. If you are mechanically inclined, do your routine car maintenance yourself. Share a car or use public transport.

Around the house Reduce Your Cable Television Expenses. Limit cable to one TV in your home. You can also lower your charges by reducing or eliminating the number of premium channels. Avoid using Directory Assistance. Directory assistance may charge anywhere from 30 cents for local numbers to $2.00 for long distance numbers. Use the Internet instead… it’s free.

Monitor your cell phone use. Make sure you don’t exceed the maximum number of minutes included in your plan. Consider purchasing a prepaid plan to control your cell phone budget. Make long distance calls when the rates are lower. Nights and weekends generally offer the most advantageous rates.

Look for packages that include UNLIMITED long distance. Eliminate extra phone services you don’t need. Call waiting, call forwarding, and speed dialing might be nice, but how often do you really use them? Or find packages that include it for free… or trade for it. Perform routine home maintenance yourself instead of hiring someone to do it for you. Barter service with friends.

For students Deduct student loan interest from your taxes. Since 2001, the federal government has allowed students to deduct interest up to $2,500 on student loans over the life of the loan. For specific tax advice, you should speak to a professional tax adviser.

Look for ways to reduce your education costs. You can save on your college tuition by taking night, weekend, or summer courses, or save on your living expenses by becoming a dorm supervisor.

In the shop Buy generic brands. Your daily gourmet coffee and muffin can cost you over $1000 a year. Try to limit your visits to once a week as a reward or gift to yourself. Put what you would have spent the other four days in a bank account. The money you save could go toward your bills, vacations, or holiday shopping.

Make a shopping list and stick to it. Don’t buy groceries when you’re hungry, you could overspend. If you’re normally in good health, it might be worth increasing your health insurance deductions.

Drop the tuxedo. Recent increases in cigarette prices make this an even better idea. Aside from the obvious health benefits of quitting, if you smoke a pack a day, you could save nearly $3,000 a year!

Shop at Farmers’ Markets or U-Pick farms. Buy in bulk or in larger sizes. Take advantage of weekly deals or seasonal foods. Eating In The difference in cost between a week of eating out and a week of shopping will send you running to the supermarket.

for your entertainment Attend movie shows and use coupons. Many theater chains offer matinee and early bird discounts.

Rent movies or video games. Check your local library for favorite titles. Be sure to return them on time to avoid late fees. Borrow books from the library instead of buying them.

Shop during the right season. You can usually find good buys when new models are introduced and retailers need to get rid of older merchandise. For example, portable audio products, microwave ovens, and air conditioners often go on sale in the spring, and washers and dryers go on sale in September.

Make a vacation budget. If you are leaving, plan out how much you want to spend and stick to it. Save money before you go and don’t charge your vacation expenses.

Have a date? Go to a picnic. Go hiking or walk in the park. It’s a lot easier on your wallet than dinner and a movie, and it can be just as entertaining. Browse the internet for free local events. Citysearch.com is an excellent resource for free events taking place in cities across the country.

If you already have payday loan debt and can barely afford the necessary expenses, there are payday loan consolidation programs available. Be sure to do your research and go with a company that you are comfortable with and has a track record of success. If you’re more ambitious, there are step-by-step programs available online that teach you how to pay off payday loans.