Tuesday, April 15, 2014, PM | Leave Comment
When times are hard and the budget is tight and there is not enough money to pay the bills and put food in the fridge, the natural desire is to find money and find it fast. While there are some sound methods to use if you’re really in a bind, you must be careful. If you don’t do adequate research about the source you’re getting your quick cash from, it could leave you worse-off financially.
Read ahead to learn about some fast cash methods that will hurt you more than help you.
In May of 2013, the American Psychiatric Association released their fifth edition of the Diagnostic and Statistical Manual of Mental Disorders, which classifies compulsive gambling as an addiction.
While not all gamblers are compulsive, gambling is a high risk method of getting cash. Far too often, a person will bet money that he or she cannot afford to lose.
Playing the lottery is an often over-looked form of gambling, but is just as expensive and risky.
Credit Card Cash Advance
Using a credit card to get fast cash may seem like a good idea at first, but a look at the fees proves otherwise.
The average interest for a credit card cash advance is 24 percent, which is about 6 percent higher than normal credit card interest.
On top of that is the advance fee which is usually between 3 and 5 percent or $10, whichever is higher. Add to that another 5 percent fee if the borrower uses an ATM instead of the credit card checks sent with the monthly statement.
Payday loans lend the borrower a few hundred dollars to make it through until the next paycheck. However, these loans come at a high cost.
The typical payday loan annual interest is equivalent to almost 400%. Also, the lender requires access to the borrower’s checking account in case of non-payment.
Get Rich Quick Schemes
The radio, the internet, or the sign posted on the power pole all advertise quick money-making businesses. They promise an income of thousands a month with little or no work.
Many of these are just Ponzi schemes in disguise, where the money comes from signing up other people to work the “business.” It can be easy to spot these types of schemes, however be careful, because some of them are pretty tricky.
Some of these deals will sound legitimate and above board. A good rule of thumb is to avoid any type of deal that sounds good to be true, or that promises to make you rich overnight.
When times are hard and the budget is tight, don’t go running to the easiest solution—think of ways you can cut back on your expenses.
Cancel the internet, cable TV, and cell phones until funds are once again stable. Sell that second car and other non-necessary or unused household items.
Find quick paying jobs such as babysitting, dog-sitting, house-sitting, mowing lawns, painting house numbers, or washing cars.
Use this money to build an emergency fund as quickly as possible; financial experts suggest saving 3-6 months of basic expenses.
Having money set aside for an emergency is the best way to avoid the lure of risky ways to get quick cash.
This article was written by Dixie Somers, a freelance writer who loves to write for business, finance, women’s interests, and technology. Dixie lives in Arizona with her husband and three beautiful daughters. Information for this article was provided by professionals who offer bail bonds in Sacramento as a safe, affordable option for those who need emergency financial help.