In today’s society, individuals and families are skeptical in regards to having complete faith in the economy. During some time periods we may see positive job creation and average salaries rise. On the other end of the spectrum are massive job lay offs and reduction of hours.
Falling behind on bills is a horrible scenario for any individual to be put in. Payday loan companies have created a safety net for those that need to pay for necessities/emergencies soon, but will not have all of the money until their next paycheck.
Nerdwallet provides amazing information and advice for those that may have no other option except to utilize payday loans. Today, we are going to discuss with you alternatives that we believe you should try before taking the route of a payday loan.
Negotiate a feasible payment plan with whom you owe
The very first alternative method you should try is negotiating with your debtee. It is always best to start at the root of your situation, then work your way up accordingly.
Pros: You and your debtee agree upon a payment plan, which negates any additional fees to third parties out of your pocket.
Cons: If you have a high ego or sense of pride, this is the only con that exists here. If you and your debtee are unable to negotiate a payment plan, typically nothing changes here. Excluding pre-existing recurring late fees, if this option does not work for you, then your next alternatives will most likely include a third party to some degree.
Inquire a family member to lend money temporarily
Many people believe that if you do not have anyone else on your side in this world, at least you have your family. This may be true in some cases, but everyone’s family relationship/dynamics are different.
Pros: As stated earlier, additional fees (normally high interest rates) are associated with third party loan companies. If you can negotiate a personal loan with a family member, you can avoid fees that may cause more of a stress on your financial stability in the long run.
Cons: Sometimes telling your family personal problems may not seem like the best solution. If you feel that your family may be more negative than providing constructive criticism, it is best to try a different alternative.
Setup an emergency savings account
The most full-proof alternative on this list is setting up an emergency savings account. No one expects the worse case scenario to ever happen. Nonetheless, it is always better safe than sorry to be prepared just in case.
Pros: You have full control of your savings account! If you have funds set aside specifically for emergencies, this will reduce any stress that may occur from feeling like you are in debt to anyone.
Cons: No cons exist here. All you have to do is maintain a stable savings account to your discretion and replace those funds as soon as possible.