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With the ability for consumers to easily obtain loans through the Internet, many have become lazy in regards to saving money, viewing loans as an "easy way out," instead of planning ahead and saving money to avoid borrowing. The fact remains that loans, especially payday loans, should be viewed as a LAST RESORT, and not a simple solution. Sure, giving into temptation and spending money on everything we want is easy, but what happens when we face a financial emergency and there are no funds available to cover it?

Loans are always available, but at a premium, since most carry high interest rates. It is time to instill a sense of financial discipline and restraint within yourself. Saving money is the best way to cover a financial emergency and avoid having to endure high interest loans. By having a plan and saving money little by little, a dire situation can be avoided and you can be covered in times of financial need.

The first step in saving money wisely is to set aside money from every paycheck you earn - this could be as little as 10% of what you earn or as much as 50%, though somewhere in the middle is ideal, as you don't want to completely deprive yourself. This method is a good beginners' step to take, and while it may seem difficult at first, it is one of those things that with practice becomes easy as time goes on.

For example, if you receive a paycheck of $1,000, setting aside $100, or if possible, $250, would be a
great way to get started on your savings. Over time, assuming you don't have to dip into these funds often, you can afford to save a little less as you will build up a good amount of savings to use as a contingency in case a financial emergency arises. Again, doing this takes a great deal of discipline, but you must remind yourself of the consequences of not saving, namely being broke, period, or having to be responsible for a high-interest loan. Neither is a desirable outcome, which makes this method a good first step in building up savings.

The second step to saving money wisely is to budget your finances and make necessary sacrifices. By knowing where your money needs to go each month, you can have a better understanding of where you stand financially, and how much money you can allow yourself to purchase things you really want. Keep track of every expense - rent or mortgage, utilities, car expenses, groceries, and of course, remember to save all receipts.

If you see that you are spending too much money in one area, you can identify where to make sacrifices. You can perhaps get a more economical cellphone plan, spend less money at the grocery store

or dine out less, or if possible, cut down on driving and look into public transportation (which, of course, is easier said than done). Doing this ensures that you know how much you can afford to spend each month on things you want, while having the peace of mind that you can cover a financial emergency should one occur.

Now that you have the two steps to saving money more wisely in hand, it is time to make do on the promise to be more financially disciplined. It is time to be more responsible and break the cycle of reliance on last resorts, such as conventional or payday loans to get out of a financial crisis. Of course, if multiple financial emergencies arise and you do not have enough savings to cover them, only THEN would a conventional or payday loan be acceptable, but if that is not the case, it is wise to avoid loans as much as possible. In conclusion, the best solution to a financial crisis is completely within your power - if you plan ahead and save your money wisely, you can avoid the pitfalls of high interest loans and enjoy more financial flexibility.


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