Looking at our credit card bills following the holidays was quite the nightmare. They were even higher than usual and as expected the anxiety and stress set in. While we were happy that we were able to provide our children with a lovely holiday, we did spend more money that we had planned on. We thought if we could get through to the next month without any unforeseen expenses, then we would be in an OK position. As we are all to aware, there are many unforeseen events that arise that you just can’t budget for and are very much out of our control. This reality, I became all too aware of when our car unexpectedly broke down.
Normally, my husband and I do our best to manage our finances as effectively as possible, however sometimes we do struggle somewhat to keep on top of things. This is especially true after our post holiday spending. Generally, as a backup we reserve some of our credit card balance to go towards sudden expenses, however with the shape our bills were in at the time, it was not possible to use the credit card to pay for the high cost of the car repairs.
In additional to our credit card woes, I also found out when I took the car to be serviced that the company did not even except credit card payment. I thought this was odd, however it didn’t seem like I had a much of a choice as I rely so much on my car to get to work and to get the kids to where they need to be. As it would seem, I was at a loss about what to do – we didn’t have an emergency fund for things like this. I was very worried! ‘How was I going to afford to have my car repaired?’
A friend suggested I get a payday loan to cover the cost of the repairs. At first, I was very skeptical because I had heard negative things about these types of loans, including how there are hidden charges and other downsides to paying back the money. Despite this, I decided to gather some more information about payday loans and see whether this might be an option after all.
What I found out was actually that this type of loan could help me out a great deal with our specific situation. This is because these loans are designed to act as short term emergency funds that can get you through in a pinch. Just as the name states, these loans get you through to your next payday. More specifically, they are can cover expenses ranging from approximately $100 to $1000 and fortunately my car repair costs would definitely fall in this price range.
With regards to paying back the loan, we knew we would be receiving our next pay cheques within the next few weeks and we would be able to pay back the full amount within 30 days. This loan agreement was ideal for us because we knew we would be able to pay back the loan in the given time frame and not go past the deadline. However, if we didn’t think we could pay it back in time, we would not have chose this type of loan. I made sure, I was aware of all of the terms of the loan before going forward with this transaction. I wanted to ensure that I wasn’t going to cause any further or ruin all the progress I had made on my budget.
I learned that some payday loans only last for 14 days, however in this case were would able to take on a loan term of 30 days which matched our personal needs. One important aspect of payday loans, is that if you do go over the payment deadline, then you are subjected to may additional fees – this is the downside that I was talking about earlier on and the one that had made me unsure if a payday loan would actually help more than hurt our finances.
The other factor that made this loan such a good choice for us was that we could have access to the funds very quickly and easily. This was ideal as it meant I could get the car fixed sooner rather than later and it would not disrupt our lives for very long.
I admit I had always thought more negatively about payday loans and this was because I didn’t also know that their sole purpose was to provide a short term loan versus a long term loan. If used wisely, this type of loan can be so beneficial and help alleviate the stress you feel about where you are going to find the money to pay for an otherwise unavoidable expense.
If you find you are in a similar situation, you can look to payday loans for assistance, as long as you understand the terms of the loan and that they are only meant to get you through in the interim. Take a good look at your personal situation and make sure you will be able to pay back the loan in time. Knowing when a payday loan can come in handy is key!
Overall, my husband and I were so glad we decided to take out a payday loan to help fix our car. In this instance, it worked out to be a great experience for us. If we find ourselves in a similar position again in the future, we know we have this as an option. My car is back out on the road in good working condition and life has gone back to ‘normal’ . . . for now!