Payday loans should only be used as emergency loans. Too often people get trapped by them, the loans are expensive and hard to pay off, so it is much better for you to try to avoid the need for this kind of loan altogether. There are a number of small, simple things you can do to prevent yourself from ever needing a payday loan in the first place.
First youll want to take a look at your spending versus your income. You shouldnt be spending more than you make, no matter what the limit on your credit cards. Its excellent practice to try to place away some money with every paycheck.
Next youll want to look at what youre spending you money on. Are you buying coffee every morning? You could probably make it yourself at home for pennies plus you wont have to tip the barista. If youre spending $5/day on coffee and buy coffee 22 days/month then you are spending $110/month on coffee!
Are you an impulse shopper? Do you often find yourself buying yourself a treat, or just picking up something because it strikes your fancy? Keep track of these expenses, youll probably be shocked by how much money youre throwing away. Try to only buy what youve plotted on purchasing before entering the store. If you still want the item later on, look at your finances and plot to allocate some money towards that buy.
If you really need some extra cash quick, look around your home. If you have unwanted items, you might consider selling them. If you have collectibles, you probably want to bring them to a consignment shop or sell them on eBay. If you have a lot of things you could bear to part with, have a garage sale. By doing these things youll clear out some space in your home, and youll get cash for doing that.
Dont be embarrassed to use coupons. Many restaurants are offering coupons to entice customers into their establishments. These can significantly cut your restaurant bill, especially if you have a buy one, get one free dinner coupon. You can also find coupons for haircuts, home services (such as a visit from your plumber), and of course, the grocery store. Clipping coupons can cut real money off your grocery bill, especially if the store offers double or triple coupons.
You should review your home services. How much do you pay for your cel phone? Do you really need to have unlimited text messages? You can probably get a cheaper package, just pay attention to what your contract says about changing your plot. How about your satellite or cable package? Do you really need all the movie channels or can you get away with the local free tv?
Pay attention; dont buy something just because you deserve it. Its more vital to live within your means than it is to have the latest thing. Most of us cant afford everything, so its a matter of deciding what you want most, and saving for that. Just because its new, doesnt mean its better. And remember, theres always something new coming out!
Take care of the things you own. Dont skip basic maintenance because youd rather buy a huge screen TV. It will cost you more if your car ultimately breaks down. The same goes for your own basic medical care dont skip those annual visits to your doctor and dentist.
You may want to try a small experiment. Promise yourself you wont buy anything other than your staples: groceries, gas, train or bus pass, and your monthly bills of course. After two or three weeks, youll start to know just how much money you spend unthinkingly.
Another really excellent habit to get into is to set up a savings account and automatically deposit a set amount each week into that account. Even if its as small as $5 a week, youll be able to save up $260 with no effort on your part. If you have a regular job, you can set this up with direct deposit, and you wont even see it happening. Ultimately, you want to try to have between 3 and 6 months salary saved up for emergencies.
Finally, be a smart consumer. If its really vital to you to buy something thats fine, go ahead and save up for it, or buy it if you have the cash. But dont feel you need to buy the latest $110 jeans just because theyre in style. Buy what you can afford. Your financial health is more vital than having stuff. Excellent spending and savings habits will keep you from needing a payday loan in the first place. And if you can avoid being in that situation, youre ahead of the game!