Thinking Of Taking Out A Payday Loan? Have You Considered Other Financial Aids First?.

Payday loans can be a great short-term aid when you find yourself in a difficult financial situation; they are quick and easy to apply for and are widely available these days. These short-term loans are not the only financial facility available to those enduring a rough economic spell. However recent research from the Consumer Credit Counseling Service (CCCS) and Turn2us would suggest that most people are not aware of this, or simply choose to ignore other financial resources and turn to payday loans instead.

Statistics from the CCCS and Turn2us study have revealed that:

-          27% did not look into any other financial solution before they applied for a payday loan

-          48% who are not currently employed  have not checked to see if they are entitled to welfare benefit before taking out a payday loan even though unemployed people are twice as likely to take out payday loans than anyone else

-          51%  later regret their decision to take out a payday loan

-          30% are worse off after taking out a payday loan

The survey also claimed that of the 13m people living below the poverty line in the UK, only 7.6m are claiming state support- meaning that over £19m in benefits is not being claimed. So if you fall into this category and are struggling financially, your first port of call should be checking your eligibility for welfare benefits before you start researching other financial aids.

There are also a number of alternatives to payday loans or things you can do to help your economic woes:

-          Talk to your creditors about extending your payment dates

-          Ask your employer for a payday advance (similar to a payday loan but without the excessive interest and fees)

-          Take out a small loan from your bank (if you have a steady income and good credit rating/history)

-          Extend your bank account overdraft

-          Use savings or your emergency fund if you have any

You should also revisit your monthly budget for your household, thoroughly examining your incomings and outgoings for each month to see if there are any regular purchases or bills that you could cut out to save money.

If you find yourself in a difficult financial situation you should always seek independent financial advice before you apply for any economic relief. Organisations like Citizens Advice, National Debtline and Consumer Credit Counselling Services (CCCS) all offer free impartial advice concerning financial matters.

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