University of FloridaSolutions for Your Life

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Publication #FAR9027

Payday Loans1

Patricia Bartlett and Josephine Turner2

Figure 1. 
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For 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 website at

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This document is FAR9027, one of a series of the Family Youth and Community Sciences Department, UF/IFAS Extension. Broadcast as program 161 and published February 2008. Revised May 2008. Reviewed January 2015. In the interest of time and/or clarity, the broadcast version of this script may have been modified. Visit the EDIS website at


Patricia Bartlett, staff writer, and Josephine Turner, professor, Department of Family, Youth and Community Sciences, UF/IFAS Extension, 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 UF/IFAS Extension publications, contact your county's UF/IFAS Extension office.

U.S. Department of Agriculture, UF/IFAS Extension Service, University of Florida, IFAS, Florida A & M University Cooperative Extension Program, and Boards of County Commissioners Cooperating. Nick T. Place, dean for UF/IFAS Extension.