How would you change your daily habits to successfully afford your short-term payday loan payoff? It would be interesting to know how much money gets wasted out of each paycheck on unplanned spending. How frugal is the average household? How much do you spend each day which is not in your budget categories? If this money was accounted for, would the typical payday loan customer have better luck getting their debt paid off or would these same people even need a short-term loan in the first place?
Would changing spending habits ensure a payday loan payoff?
How often do you stop at the store for a cold drink, a pack of smokes or grab a bite to eat through one of the drive-thru lines on the way home? Are you spending cash, using your debt which comes from your bank account or charging to a credit card? Where this money comes from may help you analyze your money management system. If credit cards are supplementing your ‘extra’ charges, it may help to take the next step needed and figure out which category will support the payoff. If you do not pay off the creditor in full, the interest charges for these small purchases will have you spending more than their worth.
Cash Advances are for short-term
If you depend on short-term money to make good on unexpected costs, but you continue to spend on daily extras, how do you manage to pay off the payday loan in full? Pay on the original due date to keep this fast money loan cost-effective. Anything extended or rolled over will accrue additional interest charges. Remember that these cash advances are meant to be short term.
You need to account for every dollar of your hard earned income. Take out a pen and paper and begin to keep track everything you spend. Use your notepad on your tablet or smartphone and keep track that way. Every time you buy a pack of gum, refill your coffee, purchase an app for your phone or cover an overdraft charge on your bank account, mark down the expense. Take it a step further and write down how much interest you are paying each month. Once you see how much money goes out of your account to pay for maintaining a debt balance, you will most assuredly want to make a change.
Children need to learn early that spending money is a privilege
Look at tracking expenses as a positive way to manage your money. Take the hassle of recording every dollar spent as a challenge to build a better financial future. Get your children involved so they will create some spending habits. If you don’t have the money, you don’t spend it. There are so many third party money opportunists that want to control your finances. Children need to learn early on that spending money is not a rite of passage but an income privilege.
If you were to rework your budget to fold into these extra daily costs under one of the funded categories, would you be able to refrain from spending extra somewhere else? If you needed borrow, would you be able to reallocate from other budgeted areas? Be deliberate on your payday loan payoff and stop charging card balances that stretch out over several months or years. It would make smart financial sense.