Although they’ve grown in popularity over the course of the last decade, payday loans have managed to build up an extremely negative reputation. Not all payday loans share the same terms, but most have ruinous charges attached to them, high interest and strict repayment stipulations. As a result, even minimal initial borrowing can spiral to become a significant debt problem.

So why do they remain so attractive to ordinary borrowers? The answer is simple. They’re marketed well, are incredibly easy to apply for, and seem like an ideal solution for those who are only struggling short-term. Don’t be fooled, however; payday loans are unsuitable for the majority of people.

This advice is easy to give, but perhaps not so easy to heed. For those in need of money in the short-term, it creates a significant problem: a shortage of funds and no immediate remedy. Luckily, payday loans are not the only interim borrowing option available to you. Here are just a few alternatives to consider…

Overdrafts

Most bank accounts will offer an attached overdraft facility, and these can provide a brilliant alternative to payday loans. On average, your overdraft will allow you to borrow between £500 and £5,000, with no set date on when this amount must be repaid. Although some banks will charge interest on certain accounts, this is likely to be significantly lower than payday loan options, and charges will only arise if your borrowing exceeds the set amount.

Credit Cards

For those that have already maxed out their overdraft, credit cards can also offer a viable solution for short-term borrowing problems. Most credit cards will allow you to borrow between £500 and £5,000 at a time, and although you’ll pay more interest than you would on an overdraft, this sum will be significantly less than if you borrowed from a payday lender. As an added boon, credit cards can be a great way to build a positive credit history, provided that you meet your repayment terms.

Specialist Short-Term Loans

Some people, such as students, may also find that they qualify for specialist short-term loans from companies such as Smart-Pig. These alternatives allow you to borrow money quickly and easily, like payday options, yet they provide much more attractive terms, including features like grace periods, capped interest rates and ‘no rollover’ pledges.

Pawnbrokers

Another very old but still useful borrowing option is pawnbroking. Pawnbrokers carry out very little in the way of background or credit checks, making them well suited to those with a poor credit history, but still provide quick and easy access to capital. In exchange, you’re required to hand over as an asset as surety, which is returned to you when the money you borrow has been paid back.

If you’re considering a payday loan, could one of these options be a suitable alternative for you?

Students who successfully graduate from college hope to be able to use their degrees to provide them with the chance of a good career. It is not always easy to complete a college course and one of the obvious pressures is finance. There are student loans available but that is no reason to become complacent with money; they need to be repaid. Youngsters often lack the experience to handle money sensibly. If it is scarce it becomes even more difficult to manage daily expenditure. Learning financial responsibility at a relatively young age and starting to create a good credit score is valuable when graduates are looking for unsecured loans in the future. There are a few things worth considering that might help

Research Projects

There are occasions when students will be able to earn a few dollars more by asking within their college whether any of the research projects being undertaken need people to help within their testing. They are effectively the ‘guinea pigs’ that are used test theories, even scientific ideas or products. The amount of money available and the time that a student may need to set side will vary from case to case.

Brew at Home

The coffee shop may be a nice place to meet but the costs in a shop each day will certainly add up. Surely it is just as good, even better, to socialize out in the open air? Coffee from home comes much cheaper and everyone can take turns bringing it along. No student should ignore the importance of friends and socializing but likewise the reason for being at college is to study and get a good qualification and that should be the priority.

Discount

Many local businesses and entertainment venues are likely to have student discounts. There is nothing wrong in asking those that do not advertise such discounts whether they will do so. In any event it makes sense to patronize those that do.

Everyone should shop around. It should be a daily habit for a student to look at the cost of food, clothing and books. Bulk buying can save money. When it comes to food it is important to avoid waste. If food has a limited shelf life it does not make sense to risk waste by buying in bulk.

Health and Exercise

Lots of enjoyable things are free. A host of outdoor activities are both healthy and great fun. Exercise and a healthy diet are important to life in general. The local park offers the chance for joggers to run safely. The fast food outlets that market themselves aggressively are convenient and the food is generally tasty. However those students that can cook should create their own tasty snacks and meals.

Having fun does not have to cost money. There are students who enjoy smoking and drinking. These things can be costly particularly in excess. Smoking is regarded as something that can be harmful to everyone’s health and drinking in excess is unwise. Students should be able to at least limit their spending on these two things if money is tight. In the early years of their careers it may still be tight; new home with mortgage to pay each month so it is worth learning the financial lessons early.

Everyone remembers their college days. The experience should be positive and contribute to the student becoming a rounded individual able to contribute positively to society. These days may involve a little sacrifice because money may be tight. However is it really a sacrifice being in a college environment? Sacrifice can be minimized by following a few simple tips and making them habits. There should be more comfortable financial times in the future for those that succeed. Recent graduates setting out on a career can even take advantage of current low interest rates to obtain loans. Student days when recalled should bring back a smile to every graduate no matter how successful subsequently.

Long before there was email, people’s physical mailboxes were inundated with junk mail. Lots of it. Whole forests likely perished supplying the paper for mailings that tempted us with offers from Publisher’s Clearing House, cheap magazines, and the Columbia Record and Tape Club. Records and tapes, for you young people, were— oh, never mind.

Today, the process has been digitized of course and with the added efficiency provided by the Internet, that pile of junk has now become an electronic mountain. One advantage though, is that you can easily choose who sends you offers and what kind, with a few mouse clicks. But the competition is fierce.

Clever marketers have realized though, that the key to reaching their target demographic is through the path of least resistance— old fashioned snail mail. Between 2007 and 2012, according to the New York Times , the amount of physical junk mail dropped by 26 percent. That’s a bummer for the U.S. Postal Service, but welcome news for mailbox owners.

The average person gets far less physical junk mail today, so the odds of standing out are much greater. When you stop and think about it, physical junk mail has a lot of advantages over the electronic kind. Not only is there less competition, but email can be much more easily blocked. The space in which marketers have to operate is much smaller with email as well, at least in the introductory phase.

Physical mail can come in any variety of shaped and sizes, with space available to for all manner of words and images. Email’s first and only impression, is often a mere subject line, usually limited to around 50 characters. That’s it.

Marketers can make a physical piece of mail all kinds of enticing. For example, the one below that informs the recipients that they have won a free Caribbean Cruise. Call the toll free number to claim the prize. Sounds pretty easy, so why not?

Well, for one it arrived pre-sorted, or what is also known as bulk mail. That just feels sketchy. For most consumer advocates that’s the initial measuring stick. Does it look fishy (as it were for a cruise giveaway), or too good to be true? If so, discard immediately. But what if you call? Dollars and Sense decided to find out.

Thank you for calling

Again, the mailing we got a hold of stated that a Caribbean cruise on either Norwegian Cruise Lines, or Royal Caribbean International had been awarded. With round-trip airfare. Simply call to claim the prize. After waiting for several minutes, and being told repeatedly that our call was important, a representative finally came on the line. She asked for the claim number and put us back on hold for a few moments.

It turns out that the prize is being issued by a company called Endless Access (no kin to Axcess Financial, the company that owns Check ‘n Go). The representative says that Endless Access is a travel agency located in a nearby suburb called Blue Ash. However, a quick Google search returns no local office location for that company. They do have a website though.

The mailing is part of an advertising promotion, and to claim the prize you must only give 90 minutes of your time. During an hour and a half presentation they will present all the different travel services they offer. No obligation, just sit and listen. That doesn’t sound like a scam. Except it is. According to the Better Business Bureau, news reports, and some of the companies mentioned as partners in other mailings like Marriott Hotels, many consumers have complained endlessly about Endless Access.

According to a report by Alex Dunbar of CNY Central (a consortium of local TV stations in Syracuse, New York), seminar attendees are issued the vouchers. The problem is there are hundreds of dollars in fees associated with them, as well as loads of travel restrictions. It’s no wonder that they ask that you bring a credit card, and not a state-issued ID or driver’s license, as proof of your identity.

CNY Central also reports that membership with Endless Access is upwards of $9,000. And that doesn’t even involve any trips. You could go on a lot of Caribbean cruises for $9,000. People show up though. It’s almost like the Internet didn’t exist.

You can listen to the entire call to the prize claim line below or on our SoundCloud page.

Research and insights for this article were provided by Check ‘n Go.

Finally it’s starting to look like technology has found a means to subvert the international money exchange system thanks to peer to peer currency exchanges. At present, the sector is one of the fastest growing in consumer finance and offers a wealth of advantages and generally much superior rates compared to the established banks. Even those that consider themselves market leaders in the business of currency exchange are being ever more undercut by P2P currency exchange services; and the great thing is that as this option becomes more established it can only grow further.

So what’s wrong with the traditional currency exchange system?

High street banks have long made a hefty dose of their profits by artificially raising the price of exchange currencies above the international bank exchange rate. Sure every company needs to turn a profit, but banks typically make around 5% of their profits by these exchange markets which were, until now, seemingly impervious to any alternative system. While there are companies that have been overtly set up and marketed to serve companies exchanging large sums at preferential rates, the truth is that even these operators are now being seriously undercut.

How has P2P currency exchange managed to become so popular?

In truth, it’s not just the popularity that is the fascinating issue here; it’s also how quickly the market has developed. Much of this has been down to people and companies becoming ever more willing to ‘think outside the box’ when conducting financial affairs – especially online. You can look at the prominence of alternative currencies such as Bitcoin becoming accepted as a viable (if temperamental) currency, how online shopping and business ordering has become the norm in day to day life and even a sense of frustration at the banks themselves following the crash of 2008.

Essentially the technology has made alternative systems of currency exchange viable, and they have been set up long enough now to prove that the system works.

How does P2P differ?

There’s plenty of in depth articles about the economics of P2P exchange but it’s worthwhile quickly outlining how the system works and why it is so able to undercut the banks. In a nutshell, a P2P currency exchange allows their clients to offer their domestic currencies at their own set rate of exchange and look for people abroad wishing to enact a similar trade – it’s essentially a match-making service. This is conducted under strict anonymity and the funds are managed through the site in exchange for a small handling fee. This makes the exchange of currencies a personal transaction based upon total anonymity, and the rates available can often seriously undercut the banks.

But isn’t it risky doing business this way?

Not at all, and this is one of the main reasons for the successful growth of the system. Not only are transactions all handled by the site itself – the exchange partner who you match with has no knowledge of your banking or personal details – making the site exceedingly difficult if not even impossible to defraud. The transfers tend to lean towards larger amounts for the best rates – making them great for businesses, especially those with international concerns.

Is p2p going to continue to rise?

All indications are that this is the case, especially as trade and lifestyles continue to become ever more internationalised. At present users need to have a bank account arranged in the currency that they wish to transfer funds to – say an account not just in the UK but also one in a Eurozone country to exchange into Euros or the USA to convert Pounds to Dollars. It’s not yet a viable option for personal, low-scale use such as holiday money but can save many thousands for larger transactions that otherwise would just be going towards the banks profit.

There’s no sign of the cynicism that people feel towards banks shifting anytime soon, and instead there’s a very good chance that P2P exchange will become a norm in the future – especially if rumoured services targeting smaller scale users come to fruition.

MidPoint offer a peer to peer money exchange that is one of the best established in this burgeoning marketplace. Take a look at their services to understand just how much P2P currency exchange can save you and your business.

 

I’ve been missing in action from writing for the last several months. My blog, Vicarious Nomad, first started out as Where in the World is Miel, and these days it seems you should changed to Where in the World has Miel gone? Not specifically due to dropping off the edge of the earth to some remote locale (though there has been a fair amount of travel), but rather just a whole lot of life going on.

To sum things up, try this one for size for a summary of seven months in a blurb. Gave birth at home to my dear sweet Clark. Ran several family businesses (while nursing) and increased the profits on both businesses several times over (Olivia Beach Camp Cabins and District Media). Tandemly sold our place in DC and bought a sweet bungalow in a fabulous location in Portland, Oregon (just 1.2 miles from my sis Darcy). If that wasn’t enough, then land my dream job as the new Executive Director of Green Empowerment. Add in travel (with my new born) to Oregon, the Bay Area, New Orleans, Tahoe, and Kenya to top it off.

So you can see that there has been just a bit going on in my life. Looking at my travel and schedule this spring I don’t see that decreasing any, but I do see the need and desire to partner with Darcy in authentically sharing about our finances and what that looks like as we seek our own versions of sustainable family finances.

After nearly nine years of finance blogging, on and off, there is perhaps more than ever to share with readers about what it takes to keep a family in balance, how we prioritize our finances is really how we prioritize our lives, and so much more.

Thanks in advance for reading, commenting, sharing with others. It helps inspire us to continue to share our stories. Thought I’d share a few fun pics of us this holiday season as well.

Cheers,

Miel