Pay Day Lending - is it ever ok?

dealer_wins

dantan wrote: »

I know Pay day lenders get really bad press because of high APRs that go like 3,000% or 4,000%

Lets say there are lenders with 200% APR - are they still frowned upon?

Its a shame that more people dont have an emergency savings fund to cover lifes unexpected expenses.

My parents always told me to put away 10% of my net income into an instant access account to cover any sudden expenses.

And if I couldnt afford to put away 10% I was living beyond my means and should adjust my lifestyle accordingly.

Best advise I ever had, and stick to it to this day 25 yrs on, and I would recommend it to everyone!!

iolanthe07

dealer_wins wrote: »

Its a shame that more people dont have an emergency savings fund to cover lifes unexpected expenses.

My parents always told me to put away 10% of my net income into an instant access account to cover any sudden expenses.

And if I couldnt afford to put away 10% I was living beyond my means and should adjust my lifestyle accordingly.

Best advise I ever had, and stick to it to this day 25 yrs on, and I would recommend it to everyone!!

Good advice - but to many people the concept of living within their means and saving up for a rainy day is utterly alien.

Peelerfart

Can we all stop using the "save" word please.

We all know it has no place on this board

tlh858

Payday loans are poison.

The very presence of a payday loan on your credit report might as well be a loud siren going off and big red flashing sign warning every other financial organisation to run away and not lend you money for anything.

They are marketed at people who are already having problems managing their finances, and therefore are the most likely to default on payment, and can least afford them.

opinions4u

dealer_wins wrote: »

Its a shame that more people dont have an emergency savings fund to cover lifes unexpected expenses.

My parents always told me to put away 10% of my net income into an instant access account to cover any sudden expenses.

And if I couldnt afford to put away 10% I was living beyond my means and should adjust my lifestyle accordingly.

Best advise I ever had, and stick to it to this day 25 yrs on, and I would recommend it to everyone!!

In the end, it gets no more complicated than this.

Spend less than you earn. Stick a bit to one side. Expect the unexpected.

Dabooka

opinions4u wrote: »

In the end, it gets no more complicated than this.

Spend less than you earn. Stick a bit to one side. Expect the expected.

Edited for accuracy; how often is the unexpected problem actually something like car tax or an MOT as opposed to someting taht really couldn't be foreseen?

It's not as if you need to read the runestones to predict most of the excuses used to take them out.

opinions4u

Dabooka wrote: »

Edited for accuracy; how often is the unexpected problem actually something like car tax or an MOT as opposed to someting taht really couldn't be foreseen?

It's not as if you need to read the runestones to predict most of the excuses used to take them out.

Point taken.

Your insurance will need renewing. Your car will need taxing. Your annual holiday that you booked 6 months ago will need paying for before you go. Known events with predictable payment time.

But your telly / washing machine / toaster / microwave / iPad or whatever will break down. If it's not this year it will be the next year. It's unexpected when they do die, but it's predictable that they will go one day.

paddyrg

I lend you £100 until next Sunday, you pay me back the £100 with a tenner for my trouble. Seems reasonable? APR is 14,000% ish. Look behind the APR, there is a time and place for these loans - but most of the time they are badly misused.

CLAPTON

paddyrg wrote: »

I lend you £100 until next Sunday, you pay me back the £100 with a tenner for my trouble. Seems reasonable? APR is 14,000% ish. Look behind the APR, there is a time and place for these loans - but most of the time they are badly misused.

No it isn't reasonable but it is viable if you do it only once. In the same way you're just giving me £10 for no particular reason is viable too but you don't often do it.

We need to teach the simple mantra, save first then spend

Dabooka

opinions4u wrote: »

Point taken.

Your insurance will need renewing. Your car will need taxing. Your annual holiday that you booked 6 months ago will need paying for before you go. Known events with predictable payment time.

But your telly / washing machine / toaster / microwave / iPad or whatever will break down. If it's not this year it will be the next year. It's unexpected when they do die, but it's predictable that they will go one day.

It was a cheeky tongue-in-cheek comment about the "unforeseen circumstance" brigade who don't appreciate that car tax is an annual event, or the 23yr old Baxi was going to conk out one day!

I look forward to the day we genuinely get "I needed to replace my iPad so I went to Wonga" thread. Or did I miss one already?!