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Payday Loans1
Patricia Bartlett and Josephine Turner2For many people who are living from paycheck to paycheck and facing an emergency or unexpected expense, a short-term loan may seem like the answer. A loan from one of the payday loan companies is easy and convenient to obtain. Typically, the applicant would write a check for $115 and get $100 back, and the loan company would cash your check on your next payday!
But wait a minute--that's costing the applicant $15 or $30 to borrow money for just a few weeks? If they pay $15 to borrow $100 for two weeks, they're paying an interest rate of 390%. If they have several payday loans due, they could end up with no money from their paycheck, and still owe money.
Anyone who may get lured by the temptation of immediate cash should consider other sources. Less expensive alternatives include short-term loans from credit unions, a pay advance from the employer, asking creditors for more time (even if they do impose a late fee), or asking a family member for a short-term loan.
Learn to make a realistic budget, and stick to it. Put off making unnecessary purchases, and put that money into a savings account to draw on for emergencies. Saving, even if it's just a couple of dollars a week, will add up quickly and could save quite a bit of hard-earned money.
Listening, learning, and living together: it's the science of life. "Family Album" is a co-production of University of Florida IFAS Extension, the Department of Family, Youth and Community Sciences and of WUFT-FM. If you'd like to learn more, please visit our Web site at http://www.familyalbumradio.org .
To listen to the radio broadcast:
http://www.radiosource.net/radio_stories/paycheckloans.mp3
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Footnotes
1. This document is FAR9027, one of a series of the Department of Family, Youth and Community Sciences, Florida Cooperative Extension Service, Institute of Food and Agricultural Sciences, University of Florida. First published February 2008. In the interest of time or clarity, the broadcast version of this script may have been modified. Please visit the EDIS Web site at http://edis.ifas.ufl.edu.2. Patricia Bartlett, staff writer, and Josephine Turner, professor, Department of Family, Youth and Community Sciences, Cooperative Extension Service, Institute of Food and Agricultural Sciences, University of Florida, Gainesville, FL 32611.
The Institute of Food and Agricultural Sciences (IFAS) is an Equal Opportunity Institution authorized to provide research, educational information and other services only to individuals and institutions that function with non-discrimination with respect to race, creed, color, religion, age, disability, sex, sexual orientation, marital status, national origin, political opinions or affiliations. For more information on obtaining other extension publications, contact your county Cooperative Extension service.
U.S. Department of Agriculture, Cooperative Extension Service, University of Florida, IFAS, Florida A. & M. University Cooperative Extension Program, and Boards of County Commissioners Cooperating. Larry Arrington, Dean.
Copyright Information
This document is copyrighted by the University of Florida, Institute of Food and Agricultural Sciences (UF/IFAS) for the people of the State of Florida. UF/IFAS retains all rights under all conventions, but permits free reproduction by all agents and offices of the Cooperative Extension Service and the people of the State of Florida. Permission is granted to others to use these materials in part or in full for educational purposes, provided that full credit is given to the UF/IFAS, citing the publication, its source, and date of publication.