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Should I get a payday loan if I need money now?

Before choosing to take out a payday loan, think about the costs you will pay, whether you want to borrow, and how you will pay back the loan.


If you take out a payday loan, you will likely be charged a fee of between $10 and $30 for every $100 borrowed. A $15 per $100 fee is typical. So, if you have an emergency and need $300 today, you would have to pay back $345 in a couple of weeks, assuming a fee of $15 per $100 borrowed. If your budget is already tight, that may be hard to do. In those states that do not ban or limit renewals or rollovers,the payday lender may encourage you to pay just the fee and extend the loan another few weeks. In that case, you would spend $45 and still owe $345 when the extension is over – that means you’re spending $90 to borrow $300 for one month.


First, there may be alternative strategies available, including those that don’t involve taking out a loan. Some employers, nonprofit organizations, and community groups offer advances or emergency credit. And don’t forget about help from family or friends.

Second, if you have an account at a bank or credit union, there may be less expensive alternatives available to you, especially if you have a stable credit history. A credit card may also be another option.

Third, another option might be to negotiate with the creditor or debt collector about the debt or bill you owe. A smaller repayment amount may help make repayment easier.

Finally, if you are expecting a tax refund or an increase in income, think about using that money to start saving some money for the next emergency.