I’m not sure what I disdain more, the payday loan industry when it spews outrageous financial advice in a transparent attempt to snare more victims (a.k.a. clients). Or the consumer advocacy groups that rail against the payday loan industry, but utterly fail to propose workable alternatives to help people in financial need. But today I’m going to rail on the payday loan industry, and even throw Google News under the bus.
I subscribe to a number of Google News feeds, including those related to the payday loan industry. Every day I see “news” item after “news” item in the Google feed from a site called, Personal Money Store Money Blog. The blog is connected to the Personal Money Store, which is a conduit between folks need a cash advance and lenders that provide them. The site undoubtedly makes an affiliate fee or commission for each borrower it sends to a lender. So far, I’ve got no problem with it. But why are articles like, “Payday loans can help clear your credit card payment issue” ending up in a Google News feed? It ain’t news, not to mention horrible, horrible advice.
Google of course isn’t really in the business of deciding what content is “good” or “bad.” In fact, just about any site can get listed in Google News, so long as it has multiple authors. Whether the Personal Money Store Money Blog does or not is an open question. Regardless when it comes to Google News, Google should be in the business of making sure it’s news. Everyday I see a ton of articles coming through the feed from this site, and it’s nothing but crap. Here’s the advice it’s giving related to using payday loans to pay off credit card debt. First, this payday loan site talks about the evils of credit cards:
Credit card companies hurt us in the long run
Most credit card companies give an option to its customers to not pay the total amount of their credit card debt on the payment due date; this makes the customer feel happy and sometimes they eventually end up in a worse situation.
Cycle of debt
When customers choose the option of delaying payments, they may start accumulating more debt. Credit companies take advantage of this situation and take money from the customer in the form of interest. This will never help you in managing your finances. The only way to tackle it is to stop using this option and make every effort to stay away from credit card debt.
Now some might actually agree in part with this. But let’s face it, the problem isn’t that credit card companies allow extended payments. The problem is how we use that option. But the real kicker was what followed next:
Take charge of your finances
First of all, let’s start off by taking an oath that before the credit card payment day comes, you will pay your entire credit card balance in full. You might feel, how can I pay the credit card bill when I don’t have enough money? Who will lend me this money? The answer to your question is quite simple. Do you know that payday loans will help you to get out of this mess?
Really? Payday loans to the rescue! It is true that a payday loan is typically due on your next payday. But guess what? The payday lenders will be more than happy to extend your loan out again (for another fee, of course).
The point here is not that payday loans are always bad. If used properly, they can be a reasonable option in a difficult situation. But arguing that credit cards are bad and that payday loans should be used to pay off credit cards is absurd.