How to Budget and Save Money When You’re Making Minimum Wage

Finding extra money to put aside isn’t easy when you’re working a minimum wage job, but that doesn’t mean you can do it!

If you’re having a tough time living off minimum wage, you’re not alone. Adjusting for inflation, the federal minimum wage hit its high point in 1968. The $1.60 minimum wage of that era would be worth around $10.69 today, much higher than the current minimum wage of $7.25.

Unfortunately, while the minimum wage has not risen with inflation, the cost of rent, food, education, medical care, and pretty much everything else has.

And it’s not like teenagers are the only ones working minimum wage jobs, either. In fact, it’s just the opposite. As recently as 2015, less than half of those working for the federal minimum wage were between the ages of 16 to 24.

If you’re relying on the minimum-level wages to get by, odds are good that your finances are pretty tight. Maybe you’re relying on high-cost cash advances and payday loans to get you through till your next paycheck—and that’s putting you even further behind!

The best way to protect yourself from those predatory no credit check loans is to build up your savings, but saving money when you’re working for minimum wage isn’t easy! That’s why we asked some financial experts for their advice …

Spot your expenses.

The first part of getting any budget in order is knowing how much money you currently have coming in and how much you’ve got going out. As long as you’re keeping track of your paychecks, you know what you’ve got going in. But it can be easy for anyone to miss how much they’re spending if they aren’t paying close attention.

“Many of us have no idea what our expenses add up to every month,” advised Carla Dearing, CEO of online financial wellness service Sum180 (@mysum180). “When you know where your money goes, you are in control and can be thoughtful about aligning spending with priorities.

“Use an online money tracking service, like Mint or Quicken, to see all your financial accounts in one place and even create your first budget. Doing this, you will always know where you stand financially.

“Mint, for example, gives you complete access to your data through the website and your mobile device, whether you use iOS or Android. Better yet, Mint keeps an eye on your money for you. It even sends alerts to remind you to pay your bills or when you go over budget.”

And you’ll want to be extra careful to make sure you don’t miss anything.

“Audit your spending to eliminate hidden expenses,” Dearing suggested. “It’s one thing to identify and eliminate the expenses you know about, but what about the ones you don’t know about or notice?”

She offered two examples of hidden expenses that could be secretly sucking your bank account dry:

“If you haven’t done a serious credit card review in a while, you may be surprised to see how many charges are automatically showing up on your credit card every month and every year. They’re not necessarily fraudulent; they may be charges you legitimately signed up for long ago, and then never thought about again.

“Netflix; a gym membership from an old address; subscriptions to professional publications … You may not notice right away, but automatic charges like these all add up, especially over time. The expenses may be fine if you truly need and can afford them, but often it’s a case of out of sight, out of mind.”

Start cutting out expenses.

Once you’ve identified where your money is going, it’s time to start figuring out where you can make some cuts, if possible.

“You probably hear it everywhere but it is such a necessary step in your financial plan,” said Michael Outar, Savebly (@savebly) founder, of cutting down on your spending.

“First look at your ‘wants’ column you created, where can you cut costs here? Maybe it’s eating out, your Netflix subscription, Amazon Prime, new clothes, etc … These are all things you don’t need but want.

“To improve your financial situation you need to practice delayed gratification. Cut down on wants now so you can pay off your debts/expenses and save money for a rainy day.

“Next, find ways to cut down on those necessary expenses. For example, you have a credit card with high interest, of course, you have to pay it off, but try negotiating with the credit card company to lower the interest rate. Another example is car insurance: shop around to find a better deal.”

Dearing also gave us her take on cutting down: “Identify two or three regular monthly expenses that you can do without—then delete them. For one person, the eliminated expense may be premium cable and a too-generous data plan. For another, it may be online shopping and extra spending on eating out.

“Be creative so you don’t feel deprived. If you love to eat out, challenge yourself to make delicious meals at home six nights a week. Your one restaurant meal per week will feel more special and you’ll save a ton of money.”

And we don’t need to tell you how much of your paycheck goes to rent, but it’s worth bringing up anyway.

“Live with roommates and split costs when possible,” recommended Chad Rixse, founder of Far North Capital (@farnorthcapital) in Anchorage Alaska. “Keep rent costs in a favorable place by living with roommates and reduce everyday costs on food and household items by splitting the costs with them.”

Plan ahead.

It isn’t easy to plan for the future when you’re living paycheck to paycheck. But even just a little planning can make a difference.

“Schedule due dates for financial obligations around paydays,” Rixse told us. “While rent typically has little flexibility in when it can be paid, most other monthly financial obligations will allow you to change the date they’re due. Try to schedule as much of these around paydays to ease cash flow and minimize potential cash crunches.”

Rixse also explained the benefits of short-term planning when it comes to restocking on food:

“Plan ahead for the grocery store: If you’re buying groceries on the fly, it’s much harder to stick to a specific budget, and much easier to overspend. Plan your meals for the week ahead of time and have a list prepared before heading to the grocery store. Buy in bulk and go for frozen foods when possible without sacrificing quality.”

Quoth the saving.

How are you supposed to even think about saving when you’re barely getting by? Well, it’s not easy, but the less you’re getting paid, the more important it is to have savings. It’s an unfair contradiction.

“If you are earning a low wage, don’t let it discourage you from saving,” urged Money Elevation Coach Roslyn Lash (@RosLash). “Temporarily ignore the suggestions about saving a minimum of 20 percent. It is more important that you save something, and no amount is too small.

“When I was in college I received a $7.50 stipend per week. I saved .50 per week. It wasn’t a lot of money nor was it an uncomfortable amount to set aside, but those cents accumulated and it helped to develop a habit of saving. It gave me a sense of pride.”

Try to get get the numbers up

Getting a new job isn’t the easiest thing in the world—especially when you’re working a minimum wage job with inflexible hours that make your job search even harder. But if you’re really struggling, it’s worth looking into all your possible options to bring your income up.

“Saving money is great but when you are making minimum wage there is only so many ways to cut costs,” suggested Outar. “You need to find ways to make more money, ask for a raise at your job, get a new job, take on some gigs for more income, etc … Also, make simple changes like opening a high-yield saving account to get some interest on your money.”

Living on minimum wage is difficult, even before you start considering all of the unexpected occurrences that could happen. But if you can start getting a handle on your budget, you can hopefully get a good upward spiral going—and kiss those predatory bad credit loans goodbye!

If you’re looking to earn more money—either through a side hustle or by getting a better job—check out these other posts and articles from OppLoans:

Do you have a  personal finance question you’d like us to answer? Let us know! You can find us on Facebook and Twitter.

Visit OppLoans on YouTube | Facebook | Twitter | LinkedIN | Instagram


Carla Dearing is CEO of Sum180 (@mysum180), an online financial wellness service designed to be simple and affordable. She is also CEO and Managing Director of IMC, a marketing services agency. Previously, Carla held senior executive positions with at the University of Louisville, Community Foundations of America and Investors Capital Services. Earlier, she worked at Morgan Stanley and American National Bank & Trust Company. She holds an MBA from The University of Chicago Booth School of Business and a BA from the University of Michigan, Phi Beta Kappa.
Roslyn Lash (@RosLash), the Money Elevation Coach, is an Accredited Financial CounselorⓇ, Real Estate Investor, and the Author of The 7 Fruits of Budgeting. She works virtually with single women helping them to gain clarity around their finances, reduce debt, and increase their net worth so that they can live a more abundant life. Her advice has been featured in national publications such as USA Today, Forbes, TIME, Huffington Post, Los Angeles Times, and a host of other media outlets.
Michael Outar is the founder of Savebly (@savebly), a blog about personal finance and personal development. He took control of his money and paid off $24,000 in student loans before 24 years old! Michael believes that if you make simple lifestyle changes you can drastically improve your financial life and he wants to show you how.
Chad Rixse was born and raised in Anchorage, Alaska until the age of 18. He then spent the next 11 years in Seattle where he graduated from the University of Washington and got his start in the financial services industry. Chad has since moved back to Anchorage to found Far North Capital (@farnorthcapital) and continue pursuing his lifelong passion for helping others. He finds the positive difference he’s able to make in people’s lives the most rewarding aspect of his work. Outside of work, Chad loves enjoying all that Alaska has to offer. In the summer, he loves to camp, hike, fish, and golf. In the winter, he downhill skis and gets to the rock gym a few times per week. Chad is also active in the Anchorage Chamber of Commerce’s Young Professionals Group.

Will Paying Off a Cash Advance Loan Early Save Money?

With some loans, you can save money by paying them off ahead of schedule—but paying off a cash advance loan early might leave you disappointed!

If you’ve taken out a cash advance loan to cover emergency expenses and you’re in a position to pay it off early, congratulations! You’re getting ahead of the game. But will paying that cash advance loan off ahead of schedule actually save you money? Here’s what you need to know.

How do cash advance loans work?

If you’re familiar with payday loans, then you can skip to the next section. That’s because payday loans and cash advances are essentially interchangeable. In fact, cash advances are sometimes referred to as “payday cash advances.”

Cash advance loans are small-dollar, short-term no credit check loans that are aimed at people with poor credit, the kind whose scores lock them out from borrowing money with traditional lenders. They have an average principal loan amount of a few hundred dollars and an average repayment term of only two weeks.

These loans are very easy to apply for—oftentimes all you need is a bank account in order to qualify for one— and they’re repaid in a single lump-sum balloon payment with the due date set for the borrower’s next payday. Lenders usually “secure” the loan through a post-dated check or an automatic debit agreement for the amount owed.

The average interest rate for cash advance loans is $15 per $100, which seems fairly reasonable … at least at first. When measured against regular personal loans, however, that cost is extremely high. A 15 percent interest rate for a two-week online loan adds up to an annual percentage rate (APR) of almost 400 percent!

It all depends on how interest is being charged.

Any loan you borrow is going to come with some kind of interest. But there are two ways that interest can be charged, and that is what determines whether or not early repayment will save you money.

The standard way to charge interest is as an ongoing rate. A loan with a 10 percent APR, for example, would accumulate 10 percent of the loan principal in interest every year. That means that interest on this loan accumulates at the rate of .027 percent every day.

However, when interest is charged this way, every payment made on the loan lowers the outstanding principal, which means that less money accumulates in interest. To return to the previous example: A one-year $1,000 loan with a 10 percent APR would actually only accumulate $56 in interest.

The other way to charge interest is as a simple flat fee. A $500 cash advance loan with a 15 per $100 interest charge, for instance, would charge the borrower $75 in interest right off the bat, to be repaid when the loan is due.

If interest is being charged as a flat fee, then paying off your loan early won’t save you a dime. That interest fee is the same on the day the loan issued as it is on the day it’s due. So in answer to the question posed in the title of this post: No, paying off a cash advance loan early won’t save you money.

With amortizing installment loans, on the other hand, paying your loan off early will save you money. (Here’s a quick primer on how amortization works.) The quicker the loan is paid off, the less time there is for interest to accumulate, and the less money you’ll pay on the loan overall.

The one exception for installment loans can be prepayment penalties. These are extra fees levied against the borrower if a loan is paid off early. If you’re looking to take out a personal installment loan, do your best to find one that doesn’t charge prepayment penalties.

With cash advances, watch out for loan rollover.

Even though paying off a payday cash advance loan early might not save you money, they can still seem like a pretty good proposition. Two weeks and you’re out of debt!

But the truth of how these short-term bad credit loans work looks a little different. According to data collected by the Consumer Financial Protection Bureau (CFPB), the average payday loan user takes out 10 loans annually and spends almost 200 days per year in debt.

And when interest is charged as a flat fee, the costs can add up quickly. Many borrowers have trouble affording those lump sum payments, which leads to them either reborrowing a loan or rolling to over—at least if they live somewhere that hasn’t banned loan rollover outright.

Reborrowing a loan simply means taking out a new loan immediately after you’ve paid off your old one. Rolling a loan over, on the other hand, means extending the original loan’s due date in return for a new interest charge. Oftentimes, all borrowers have to do to roll over a loan is pay off the original interest charge.

Every time someone does this, their cost of borrowing increases. If the first interest charge is 15 percent, then the second charge brings their total interest rate to 30 percent. The next rollover brings them to 45 percent, then 60 percent, etc.

When somebody is rolling a loan over, they’re paying extra money in interest, but they aren’t borrowing any extra money. Any payment they make to roll over their loan increases their cost of borrowing, but it doesn’t pay down their principal, which means it doesn’t bring them any closer to being out of debt.

There’s a name for this: It’s called a “debt cycle.” Actually, there are two names for it, as it’s also referred to as a “debt trap.” And while paying off a cash advance loan ahead of schedule won’t save you money, the dangers of one snaring you in a high-interest debt trap could end up costing you hundreds (or even thousands!) of dollars in extra fees and interest. It’s a bit of a lose-lose proposition.

To learn more about how you can improve your financial outlook—and avoid payday cash advances altogether—check out these related posts and articles from OppLoans:

Do you have a personal finance question you’d like us to answer? Let us know! You can find us on Facebook and Twitter.

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So You Got Hit With an Overdraft Fee … Now What?

Overdraft protection is like a net; it’s there to catch you when you fall. But once you’ve been hit with an overdraft fee, here’s what you can do to pick yourself up again.

When you’re living paycheck to paycheck, keeping track of your checking account balance can be tricky, especially during those last couple days before payday. If you’re not careful, you could end up overdrawing your account and getting hit with an overdraft fee.

While this might spare you the embarrassment of having your debit card declined, having to deal with that extra charge comes with real financial consequences. In fact, overdrawing your account too often and racking up all those fees isn’t all that dissimilar from relying on high-interest payday loans and cash advances to make ends meet.

Ending up with a negative balance in your checking account is a situation you definitely want to avoid—and we’ll touch on how you can do so later on in the piece. If you’ve already been hit with an overdraft fee, you’ll want to take the proper steps to make sure you get your finances back on track.

How do overdraft fees work?

Overdraft protection is a service offered by most financial institutions on their checking accounts. If you don’t have sufficient funds in your account to cover a transaction, the bank or credit union will cover it on your behalf, but they will charge a fee in order to so do. If that transaction were to result in a bounced check, overdraft protection would help you avoid hefty Non-Sufficient Funds (NSF) fee and a black mark on your banking history.

“Oftentimes, the financial institution will debit the fee from the checking account at the time of occurrence,” said Adam Marlowe, principal experience officer for Georgia’s Own Credit Union (@georgiasown). “In our case, we ask that you pay the fee and bring the balance current (to a zero balance at minimum) within 15 days. We do extend that time to 30 or 45 days depending on individual member circumstances.”

While the average overdraft fee is $30, the amount you’ll be charged will vary from institution to institution. Overdraft fees have been on the rise over the past decade, with Americans racking up over $34 billion in overdraft fees in 2017, the most they had paid since 2009.

There are a couple of different types of overdraft protection available. The first is an overdraft line of credit, which will simply cover the cost of your overdraw and charge the fee to your account. The other common form of overdraft protection will link your account to a related savings account or credit card. Funds will be transferred from that second account to cover your overdraw and a transfer fee will be charged.

Check for errors and ask for help.

The first thing you should do when you get with an overdraft is to check whether or not that fee was correctly charged. If it was made in error, then you should immediately contest it.

“If you’ve been hit with an overdraft fee, the first step is figuring out what went wrong,” said Megan Hanna, a senior business analyst at (@FitSmallBiz). “If the fee was the result of a bank error, then your first order of business is asking the bank to reverse the charge. There’s no reason for you to pay a fee for an error caused by the bank.”

Even if the overdraft fee was charged correctly, you should still contact your financial institution to see if the charge can be waived. According to Marlowe, Georgia’s Own encourages its members to contact them if they have fallen on hard times and need a little help.

“Often times financial institutions will refund the fees as long as it is not a normal occurrence. We all make mistakes,” said Marlowe. If this is the first time you’ve overdrawn your account—or it’s been a long time since you’ve done so—the odds are better that they’ll make an exception.

“Sometimes, banks will be willing to waive the fee if it’s your first overdraft, you keep a lot on deposit with the bank, and you take measures to prevent it from happening again in the future,” said Hanna.

“However,” she added, “if you had it within your power to prevent the overdraft, then in most cases, you’ll need to pay the fee.” While there’s no harm in asking, you need to be prepared to have your request denied.

Here’s how to prevent overdraft fees in the future.

Since many banking institutions prioritize processing large transactions before smaller ones, you could find yourself incurring multiple overdraft fees that add up to way more than the amount you overdrew. Imagine having to pay $150 because you had five different purchases that added up to a total of $15. That’s an APR of 1,000 percent—higher than all but the priciest bad credit loans.

And while overdraft protection can help you avoid an NSF fee, overdrafts are oftentimes also recorded on your Chexsystems report. Too many overdrafts will cause serious damage to your Chexsystems Consumer Score, which is like a credit score for your banking history. If your score drops low enough, you could be unable to open a checking account for up to five years.

As such, steering clear of overdraft fees starts with keeping a close eye on your money.

“The easiest way to avoid a fee is to maintain a checking account register,” said Marlowe. “Each time you authorize an item or debit something from the account, record it in the ledger and maintain a running balance. This allows the member to always have an account of how much money is in their account, thereby avoiding authorizing a transaction that could cause an overdraft.”

You can also set up alerts on your checking account in order to receive texts or emails when your account balance is getting low. This will let you curtail your own spending and also pause or delay recurring bill payments that might tip you over the edge. And if those recurring bills are falling on an inconvenient date, then try changing it!

“The best way prevent overdrafts is to keep track of what you’re spending, and make sure you’re aligning any automatic payments with when you’ll be depositing funds into your account,” said Hanna. “As an example, if you know your phone bill is always due on the 11th of the month but you don’t get paid until the 15th, you can see if your provider will change the due date to the 15th or 16th of the month.”

Hanna also recommended keeping a month cushion in your checking account in order to cover all your bills, even when they don’t perfectly align with your pay schedule.

“Lastly, you should monitor your checking account regularly to quickly identify and stop fraud,” she said. “In so doing, if you see someone has stolen your account number and is withdrawing funds from your bank account, you can quickly tell the bank what happened and get it fixed before it’s gone too far.”

Should you sign up for overdraft protection?

“I would highly recommend signing up for overdraft protection,” said Marlowe. “In most cases, the financial institution will pull money from an associated savings account to cover the difference and assess a small fee (in our case $6/transfer).”

The type of overdraft protection you sign up for is key. The transfer fees for overdraft protection from a linked savings account are going to be much smaller than the overdraft fees from a straight line of credit. While building up savings can be difficult when you’re living on a tight budget, that extra financial cushion will pay off time and time again.

If you find yourself overdrawing your account repeatedly, that’s the situation where overdraft protection is probably a bad idea. Even though it will be difficult, consider turning off the service until you can get your finances in order. Until then, you’ll just keep racking up fees and putting yourself further and further behind.

Overdraft protection is like a net; it’s there to catch you when you fall. Your goal should be to stop falling in the first place. If you want to achieve the financial stability neccesary to put overdraft fees and costly no credit check loans behind you, it’s going to take some work. To learn more about how you can turn your finances around, check out these other posts and articles from OppLoans:

Do you have a question about personal finance that you’d like us to answer? Let us know! You can find us on Facebook and Twitter.

Visit OppLoans on YouTube | Facebook | Twitter | LinkedIN | Instagram


Megan Hanna is a Senior Business Analyst at (@FitSmallBiz). Megan earned an MBA with an emphasis in finance and has spent much of her career in commercial banking.
Adam Marlowe is the Principal Market Development Officer for Georgia’s Own Credit Union (@georgiasown). With nearly 20 years of experience in the financial services industry, Adam has elevated the member experience at credit unions of all sizes throughout his career. He is charged with making sure all Georgia’s Own teams stay aligned with the credit union’s brand and culture and recently received his second masters in business administration from Georgia Southern University.

Cash Advance

Apply for a cash advance online. Pay back the loan in monthly installments.

“Cash advance” can refer to a number of different types of loans, and as the name suggests, they’re all ways of getting a quick influx of cash. But how you get that money—and the rates you’ll pay to get it—aren’t the same.

OppLoans offers products that can be used for cash advance purposes. Read on to learn more about cash advances and how our products can provide you with the quick funds you need.

Apply now for a highly rated installment loan or credit product that could help you build your credit history.

Some “cash advances” are better than others, and not all are safe. Here are the three kinds of “cash advance” you might encounter, and what you need to know about them so you can make the right decision when you borrow.

1. “Cash Advance” Loans

What is a Cash Advance Loan?

This type of “cash advance” is offered by online and storefront lenders. The word “loan” may or may not appear in the title, but that’s exactly what it is. And it’s not just any type of loan. A “cash advance” loan is simply a payday loan in disguise.

How does a Cash Advance Loan work?

A cash advance loan works just like a payday loan. (Not surprising, since they’re the exact same thing.) To get one, you go to a payday lender and write a check. You date it for your next payday and make it out for the amount of the loan plus interest and fees. The lender will then give you cash or transfer money to your bank account. It’s yours to spend, but remember that check you wrote? As soon as your next payday arrives, the lender will cash it and the amount will be withdrawn from your bank account.

Are Cash Advance Loans safe?

The thing about cash advance loans (and payday loans too) is that, in theory, they might not sound too bad. A typical cash advance lender will charge $15 for every 100 borrowed, and if you pay it back when it’s due, that’s all you’ll be charged.1 (As well as any extra fees, of course.)

But there’s a catch.

You only get a couple weeks before the loan becomes due, and then you have to pay back everything—the cash you borrowed, plus the interest and fees the lender charged. You have to pay it all back in a single lump sum, and for many people, this is simply unlikely to happen.

So theoretically, cash advance loans might not be too bad, but in practice they’re very risky, and the statistics bear this out:

  • The average cash advance borrower spends an average of $520 in fees to repeatedly borrow a $375 advance.
  • The average cash advance requires a lump-sum payment that consumes 36 percent of an average borrower’s paycheck.2

What happens if you can’t pay back a Cash Advance Loan?

As the data shows, cash advance loans are costly, and a lot of people have trouble paying them back. And what happens then? Many lenders will give you the option of something called a “rollover.” It might sound more appealing than defaulting, but be careful, because it’s usually a trap.

When you roll over a loan, you extend the term and only pay the interest that you owe. The lender gives you another couple weeks to pay back the amount you borrowed, but when it becomes due, you’re responsible for paying the interest all over again.

What does this mean?

While a cash advance lender may only charge $15 for every $100 you borrow, that’s only for two weeks. If you don’t pay back the loan as well as interest and fees, you roll over the loan and then you’re responsible for paying the interest again. An interest rate of 15 percent for a two-week loan becomes an interest rate of 30 percent when you roll it over for a month. And if you extend the loan for a year and do the math, you end up with an annual percentage rate of almost 400 percent!

Many people have trouble paying back their cash advance loans, and rollover is common. In fact, 80 percent of cash advances are rolled over or followed by another loan within 14 days of the first.3 And far too often it doesn’t end there. The loan becomes due and borrowers still can’t pay back the lump sum they owe, so what do they do? They roll it over once more and the cycle starts again.

Of course, cash advance lenders have no problem with this. They’re usually more than willing to let you roll over a cash advance loan because that’s how they make their money—the more you roll it over, the more you pay in interest. And the alternative isn’t any better: If you stop making payments altogether and default, the lender can pursue legal action against you and potentially garnish your wages.4

Are Cash Advance Loans a bad idea?

For many people, yes. They’re a type of no-credit-check loan and are attractive to borrowers with low credit scores. But there are safer, more affordable loan options if you have bad credit, such as an installment loan, which spreads the cost of the loan out over time.

2. Credit Card Cash Advance

What is a Credit Card Cash Advance?

A credit card cash advance is a type of loan offered by credit card companies. You use your credit card to borrow money, which you’re then responsible for paying back along with interest and fees.

How does a Credit Card Cash Advance work?

To get a credit card cash advance you go to an ATM or bank location and use your credit card to withdraw money. The amount you withdraw is added to your credit card bill almost as if you were using your card to make a purchase. But unlike using a debit card, the money that you get through a credit card cash advance doesn’t come from your bank account. It’s loaned to you by your credit card company, and you’re responsible for paying it back.

The longer you take to repay a credit card cash advance, the more you’ll pay in interest. You’re given no grace period, and interest begins to accumulate immediately. Also, compared to using a credit card to make a purchase, the interest rate you’re charged is much higher—generally around 20 percent APR or above.

How much are Credit Card Cash Advance fees?

Credit card cash advance fees typically range from two to five percent of the amount you withdraw. This means you’re likely to pay between two to five dollars for every 100 dollars you borrow.

You’re also responsible for paying interest, and in a survey of 100 cards, 86 percent of them charged above 20 percent in interest, and one charged a full 36 percent.5

Why do people get Credit Card Cash Advances?

Credit card cash advances can come in handy when there’s a necessary expense that you can’t charge to your card (like rent) and you don’t have the funds to cover it otherwise. But the problem with credit card cash advances is that they have fees and interest rates that are generally much higher than if you just used your credit card to make a purchase. Also, you can only borrow as much as your cash advance limit allows, and if you already have a balance on your credit card, that amount may be reduced.

Is a Credit Card Cash Advance a good idea?

In general, credit card cash advances are a much more affordable option than a cash advance loan from a payday lender. But they still carry fees and high-interest rates, so they should only be used if you’ve exhausted more affordable options.

3. Employer Cash Advance

What is an Employer Cash Advance?

Unlike cash advance loans and credit card cash advances, an employer cash advance is not a loan. The money you receive is yours—it comes straight out of your next paycheck. Not all employers offer cash advances, and those that do may have strict policies that limit the number of times you can request an advance and reserve approval for true emergencies.

How does an Employer Cash Advance work?

To get a cash advance, first determine if your employer offers one. It’s best to do this without asking directly. Your employer is under no obligation to give you an advance, and many do so simply as a favor, so check with coworkers or maybe your H.R. manager. If you ask your supervisor directly, you could potentially create an awkward situation.

Once you determine that cash advances are allowed, you’ll need to request one. Some companies have a formal process in place, while others may allow you to speak privately with your supervisor. Experts suggest that employees approach this conversation tactfully. Time it so you don’t ask when things are hectic at work and prepare a good argument for why you need the advance and why it’s urgent.6

If your company agrees to an advance, you’ll likely have to sign some paperwork. This will formalize the arrangement and should include details about when the money will be deducted from your paycheck so there are no misunderstandings.

Is an Employer Cash Advance a good idea?

An employer cash advance can be good because you get the money interest-free. However, your company may not offer them, and if they do, they may be unwilling to provide one except in the event of an emergency. Also, the money that you’re advanced will come out of your next paycheck, so it may cause future difficulties if you don’t budget properly.

Bottom Line:

There are three major types of “cash advance”: cash advance loans, credit card cash advances, and employer cash advances. They have the same name, but their costs are very different.

While one of these cash advances might make sense in certain scenarios, if you repeatedly find yourself in need of one, it may suggest that your financial situation deserves attention. Consider creating a budget and reducing unnecessary expenses so you can consistently meet all of your financial obligations.

Apply now for a highly rated installment loan or credit product that could help you build your credit history.


  1. “What is a Payday Loan?” Consumer Financial Protection Bureau, 16 March 2016, Accessed on 25 May 2017.
  2. “Payday Loan Facts and the CFPB’s Impact.”The Pew Charitable Trusts, 14 Jan. 2016, Accessed on 25 May 2017.
  3. Burke, Kathleen, et al. “CFPB Data Point: Payday Lending.”Consumer Financial Protection Bureau, March 2014, Accessed 25 May 2017.
  4. “Can a Payday Lender Garnish My Wages?” Consumer Financial Protection Bureau, 27 May 2016, Accessed 30 May 2017.
  5. Kossman, Sienna. “2015 Cash Advance Survey: Convenient Cash Will Cost You Plenty.” Credit, 2 June 2015, Accessed on 25 May 2017.
  6. Dratch, Dana. “How Employee Salary Advances Work.” Credit, 17 July 2013, Accessed on 25 May 2017.

How Can I Get a Cash Loan Fast?

How do you qualify for a cash advance?

If you need money right now, you may find yourself looking for a “fast cash” loan that will deliver you the money you need right away. Sure, speed of loan approval and delivery of funds are important, but don’t let the wrong fast cash loan firm steer you into a dangerous cash advance product. There are many different types of cash loans and a lot of them are designed to trap borrowers in debt.

Here’s what you need to know:

Some cash advance loans are actually payday loans in disguise: Which means an APR of 400 percent and a debt trap repayment structure.

Taking out a cash advance on a credit card comes with higher APR, an additional fee and interest that starts accruing immediately.

Apply now for a highly rated installment loan or credit product that could help you build your credit history.

What is a cash advance?

“Fast Cash” “No Credit Checks” “Payday Loans”

What does Cash Advance mean?

The words “cash advance” appear in a lot of different places. You might see them painted on the window of a store that advertises “Fast Cash,” “No Credit Checks,” or “Payday Loans.” You might see them buried in your credit card statement. You might even see them in your H.R. manual at work.

“Cash advance” can refer to a number of different things, and as the name suggests, they’re all ways of getting a quick influx of cash. But how you get that money—and the rates you’ll pay to get it—aren’t the same.

In fact, “cash advance” can refer to three totally different things. They have the same name, but that’s where the similarities end.vSome “cash advances” are better than others, and not all are safe. Here are the three kinds of “cash advance” you might encounter, and what you need to know about them so you can make the right decision when you borrow.

“Cash Advance” Loans

This type of “cash advance” is offered by online and storefront lenders. The word “loan” may or may not appear in the title, but that’s exactly what it is. And it’s not just any type of loan. A “cash advance” loan is simply a payday loan in disguise.

Credit Card Cash AdvancevA credit card cash advance is a type of loan offered by credit card companies. You use your credit card to borrow money, which you’re then responsible for paying back along with interest and fees.

Employer Cash Advance

Unlike cash advance loans and credit card cash advances, an employer cash advance is not a loan. The money you receive is yours—it comes straight out of your next paycheck. Not all employers offer cash advances, and those that do may have strict policies that limit the number of times you can request an advance and reserve approval for true emergencies.

Searching for a quick cash loan? Apply now for a highly rated installment loan or credit product that could help you build your credit history.

What Kind of Cash Advance Are You Looking For?

There are better ways to cover a financial shortfall than by taking a cash advance, but some cash advances are even riskier than that.

An unexpected budget shortfall can totally trip up your finances. Maybe it’s a surprise car repair, a sudden medical bill, or just a bunch of purchases that add up quicker than you expected. No matter what the reason, sometimes those last couple days till payday can be rough going.

One way that people who need money now can try and make up their shortfall is by getting a cash advance. While this certainly isn’t the best way to try and bridge a financial gap, sometimes it can seem like the best bad option you have.

The only problem is … the term “cash advance” actually applies to a couple different types of financial products, some of which are far riskier and more expensive than others. So, before you take one out, make sure you ask yourself, is this the cash advance you’re looking for?

Credit card cash advances.

You standard credit card transaction is entirely cashless. You swipe the card and money is transferred automatically. But you can use your credit card to get cash if you really need it. Just a visit an ATM or a local bank branch and you can get a cash advance that leaves you with cash in hand, with the amount you charged being added to your total balance.

Still, credit card cash advances come with significant drawbacks. The first is a cash advance fee that will be charged on every transaction which can vary from as low as $2 to as much as five percent of the amount withdrawn. Either way, you’re paying extra just to get this cash in your hand.

And the costs don’t end there. The second drawback of credit card cash advances is the interest rate, which will run higher than the rate you pay on a regular credit card transaction.

Third, regular credit card transactions come with a one-month grace period before interest is charged. Not so with credit card cash advances, which start accruing interest the very moment that they’re added to your balance. Not only will you be paying a higher rate, but you’ll be paying it immediately!

Lastly, most credit cards have a daily or single-transaction limit on how much cash you can withdraw. Even leaving aside that very few transactions require cash anymore, you’ll be restricted in how much money you can access via a cash advance.

In the end, a credit card cash advance just isn’t a very good way to cover unforeseen expenses. You’d be better off just putting the transaction on your card, as you’ll benefit from both the lower interest rate and the one-month grace period.

Cash advance loans.

Still, a credit card cash advance is preferable to the other kind of cash advances out there: cash advance loans. These are short-term no credit check loans, essentially the same as a payday loan, and they cost way more than your typical personal loan.

Cash advance loans have an average repayment period of only two weeks and are paid back in a single lump sum. They work as an “advance” on the customer’s future paycheck, with the due date often being set for the borrower’s next payday.

They often carry a flat-rate interest charge in the range of 15 percent. While this might seem like a reasonable rate, it adds up quickly when you compare it to standard personal loans. 15 percent on a two-week loan translates to an annual percentage rate (APR) of almost 400 percent!

Additionally, those lump-sum repayment terms can make these loans more difficult for borrowers to repay. According to a study from the Pew Research Centers, over 80 percent of payday loan borrowers do not have the money in their monthly budget to afford their loan payments.

When borrowers cannot pay back their cash advance loan on time, some will roll over the loan, securing an extension on their due date in return for an additional interest charge. Others will simply pay the loan off and then immediately take out another to cover future bills.

When you are borrowing money to cover a budget shortfall, the last thing you want is to end up neck deep in high-interest debt. And yet, constantly rolling over and reborrowing short-term cash advance loans is how people end up trapped in a predatory debt cycle.

If you’re looking for short-term bridge financing, a cash advance loan should be at the very bottom of your list.

What are your other financing options?

The first thing you should do when facing a money shortfall is to look at your monthly budget and see where you can cut back. (If you don’t have a monthly budget, you should go ahead and create one.) For those who can cover a shortfall by trimming back in other areas of spending, that’s the best route available.

If spending less can’t entirely bridge your financial gap, you should look at earning some extra cash through a second job or side gig. You can also talk to friends and family about borrowing money from them, but you should make sure that both parties are crystal clear on the terms of the loan agreement—and even then, you’re still putting your relationship at risk.

Once all those options have been exhausted, only then should you start considering either an online loan or a loan from a brick-and-mortar lender. Short-term bad credit loans like cash advances and title loans should be avoided at all costs—mainly because they cost so much!

If you can’t cover the shortfall using your credit card, bad credit installment loans might be the best way for you to go, especially if the lender reports payment information to the credit bureaus, which can help bolster your credit score in the long run.

To stave off future shortfalls, you should build up an emergency fund that you can tap into when times get tough. To learn more about how you can improve your long-term financial outlook, check out these related posts and articles from OppLoans:

Do you have a personal finance question you’d like us to answer? Let us know! You can find us on Facebook and Twitter.

Visit OppLoans on YouTube | Facebook | Twitter | LinkedIN |Instagram

Financial Literacy for Millennials

Millennials face unique financial challenges as they settle into adult life.

As a generation, millennials are straddling the line of adulthood. Some are 20-somethings just beginning to experience real-world finances on their own. Others are 30-somethings who are already there: settling into careers, buying homes, and saving for retirement.

This period of life is accompanied by a series of money-related milestones. And while everyone’s situation is unique, many millennials face three common financial challenges: debt (primarily student loans and credit card debt), housing (including preparation for home purchases), and career planning.

So how can millennials avoid financial missteps as they learn to navigate adulthood? Here are the core financial literacy skills that will set them on the course to healthy financial futures.

1. Debt

What do millennials need to know?

  • Credit and student loan options.
  • Repayment options.
  • Payment amounts and due dates.
  • Interest rates for loans and credit cards.

What do millennials need to do?

  • Take advantage of student loan exit counseling if provided.
  • Choose a repayment plan.
  • Sign up for automatic payments.
  • Create a debt payoff plan.

The challenge

One of the greatest challenges that millennials face is a national debt crisis, comprised mostly of student loans and mismanaged credit cards. College costs are steadily increasing while wages continue to stagnate. This tension has taken a toll, but luckily, there are ways that millennials can counteract it.

Research student loan options

Caleb Backe, a health and wellness expert for Maple Holistics, recommends a preventative approach to student loans. First, millennials need to be diligent in exploring their options.

“They need to do research on how their field views degrees from universities of different calibers in order to determine if taking out those student loans is truly worth it,” he said, adding that it may be “better to attend a less expensive school.”

Backe also stressed the importance of thoroughly researching scholarship opportunities, “as these can greatly offset the costs of getting a quality education.”

Develop a repayment plan

For most millennials, taking on some amount of debt is inevitable. In this case, it’s critical to stay organized with a repayment plan. Millennials should know their student loan servicer or their credit provider, as well as the repayment terms they’ve agreed to. If at any time their payments become unmanageable, they should work to renegotiate terms to better suit their ability to pay back the debt. Signing up for automatic payments is a great trick to avoid falling behind.

Get serious about debt

Finally, Backe stressed the importance of aggressively paying down debt. The longer that loans are outstanding, the more they will cost because of the additional interest the borrower will pay.

“…millennials should be aware of the fact that interest accumulates rather quickly, so it’s best to pay them back as speedily as possible,” he said.

How to pay off debt

Need a few more tips for becoming debt free? Conor Richardson, author of “The Millennial Money Makeover: Escape Debt, Save for the Future, and Live the Rich Life Now,” suggests developing a debt-free timeline.

“Write your goal down and post it in a prominent place,” he said. “Refer to it regularly. Whether you want to pay off all of your debt in one or five years, you must have a plan and a debt-free date.”

Committing to a debt-free date is crucial, he said, and to pay off debt, Richardson explained how he favors the “snowball method” of prioritizing payments, which targets the student loan or credit card with the smallest balance.

“This generates momentum and small psychological wins, which propels you toward success,” he said.

While debt may feel overwhelming for many millennials, establishing goals and developing a plan to meet them will provide returns down the road.

“Eliminating all of your debt should be the primary goal of your 20s and 30s,” Richardson said. “A debt-free future cements your financial foundation.”

2. Housing

What do millennials need to know?

  • The price-to-rent ratio of where they live.

What do millennials need to do?

  • Use a rent or mortgage calculator to determine their budget.
  • Find an apartment or house through a trusted site or real estate agent.
  • Save at least 10 percent down or, ideally, 20 percent, if they want to purchase.

The challenge

Homeownership may seem like a distant dream for many millennials, but it doesn’t have to be. The key is knowing whether renting or buying a home makes sense and how to allocate finances to reach that goal.

Rent or buy

The decision about whether to rent or own a property depends on a number of factors, including but not limited to income, debt, credit score and history, and job stability, said Daniela Andreevska, the marketing director at Mashvisor.

“Most of these are very personal and subjective, but there is one very objective factor which millennials should look at—the price-to-rent ratio in the housing market where they live,” she said.

Essentially, the ratio estimates whether it’s cheaper to rent or own a property in a given area.

“A high price-to-rent ratio—21 or above—means that in this particular market it makes more financial sense to rent rather than to buy as properties are too expensive compared to rents,” Andreevska explained. “In a market with a price-to-rent ratio between 16 and 20, it usually is better to rent.”

But some markets are ripe for homeownership.

“If the price to rent ratio is low—15 or below—it makes perfect sense to buy a home as renting is relatively more expensive,” she said.

Keep housing costs manageable

If you decide to rent, make sure to keep your rent payments below 30 percent of your income—a hard task for those in high-price cities. Even then, spending more on rent is manageable, so long as the rest of your budget stays lean. Figure out what your ideal budget is with a rent calculator.

For millennials ready to buy, try to save the recommended 20 percent down for a mortgage in addition to any moving, renovation, furniture, or emergency costs that might arise. Homeownership is a huge, exciting milestone, but one that requires careful planning.

3. Careers

What do millennials need to know?

  • The pros and cons of a traditional career versus starting their own business.

What do millennials need to do?

  • Explore job benefits, especially retirement plans.
  • Align their lifestyle to their salary.
  • Determine their aversion to risk.
  • Consider starting a side hustle if they’re interested in entrepreneurship.

The challenge

Many millennials have been told that by attending a good college they’re guaranteed a well-paying job complete with benefits, stability, and an easy route to retirement. Some might argue that this is no longer the case—the average millennial is balancing student loan debt, multiple jobs, and rising housing costs.

While many things about the job market have changed, careers that provide a stable paycheck and the security of benefits are still available. But in the age of startups and innovation, some millennials might feel called to strike out on their own.

The 9 to 5

A full-time, salaried job may be viewed as an outdated concept, but traditional careers still exist and are a good option for many millennials.

The types of jobs available have changed, however, in addition to how millennials perceive and pursue career growth. In the last decade, a boom in industries such as tech and renewable energy have enticed a number of recent grads to these fields. Frequently, employers tout competitive salaries, full benefits, and a range of employee perks—dog-friendly offices and unlimited vacation days, to name a few. Millennials should explore and take advantage of all benefits available to them, especially company-sponsored retirement plans.

Career advancement looks a lot different for millennials than for older generations who were content to begin and end their careers at a single company. Younger people tend to be less complacent and are more inclined to pursue job-hopping and lateral promotions to further their professional learning. Millennials should research career options and work to build skills and experience. Most importantly, they should align their lifestyle to their salary and commit to a budget that ensures they spend within their means.

It’s not hard to see why some millennials opt for a career with a solid salary and benefits package. The sense of security and reduction of financial anxiety alone may be well worth it.

Is entrepreneurship a smart option?

A recent study concluded that millennial entrepreneurship rates are significantly lower than other age groups. Even when the relative youth of millennials is accounted for, the rates are still low. For a number of reasons, this makes sense.

“Due to student loans, credit card debt, and expensive housing, most millennials prefer the security of a full-time job versus the risks of entrepreneurship,” explained the study’s author, Priyanka Prakash, a lending and credit expert at Fundera.

Growing up during the Great Recession also contributed to risk aversion among millennials, she said. Further, millennials typically don’t have the extra assets to invest in a business.

How to start a business

What’s the solution, then, if you’re a millennial ready to step out on your own but you fear the uncertainty of an irregular paycheck and loss of benefits? Keep your day job and begin with a side hustle.

“If you’re a millennial who is interested in business ownership but money is holding you back, I would recommend starting small,” Prakash said. “Start an Etsy shop or an Amazon shop, or start freelancing. Once you have a few steady clients, you’ll have enough revenue to grow your business slightly larger.”

When millennials feel ready to commit, exploring financing options may be worthwhile—but only if done right.

“[I]f you’re smart about debt, you can also take on a small loan to help you achieve your entrepreneurship goals,” said Prakash. “Just make sure that the loan commitment makes sense, given your business’ revenue, profits, and growth potential.”


Daniela Andreevska

Daniela Andreevska is the marketing director at Mashvisor, a real estate data analytics company which helps investors find lucrative traditional and Airbnb rental properties in the U.S. housing market. She has been writing about real estate investing for a few years, prior to which she worked in economic policy research and fundraising. Daniela holds a master’s degree in Middle East and Mediterranean studies from King’s College London. You can find her on Facebook at @Mashvisor.

Caleb Backe

Caleb Backe (MBA) provides expert services and consultancy in new-age business strategy and cutting-edge wellness. A personal trainer, life coach, and marketing director for Maple Holistics, Backe synergizes the best of business and wellness to the benefit of clients and businesses across the globe. You can find him on Facebook at @MapleHolistics.

 Priyanka Prakash

Priyanka Prakash is a lending and credit expert at Fundera, a marketplace for small business financial solutions. She helps small business owners understand their financial position and achieve their financial goals. Prakash has been working with small businesses for five years and is also a licensed attorney who served as general counsel at a Y Combinator startup. Her writing has been featured in Inc., CNBC, Fast Company, and other top publications. You can find her on Facebook at @Fundera.

Conor Richardson

Conor Richardson, CPA, is the founder of, where he helps millennials master essential money matters. Richardson began his career in New York City, working in finance and accounting and running his own businesses. His business experience ranges from working with early-stage startups to publicly traded companies. He has been featured in Fox Business, The Washington Post, and more. Richardson received his Bachelor of Business Administration in accounting from the University of Georgia and earned a Master of Accounting and Professional Consultancy from Villanova University. He currently lives in Austin, Texas. You can find him on Facebook at @MillennialMoneyMakeover.


What financial advice do you have for millennials? Tweet us at @OppUniversity and let us know!

Who Uses Cash Anymore? Why You Should Avoid Costly Cash Advances

Taking out a cash advance on your credit card or from a local storefront might seem like a good short-term money fix, but the costs are going to add up fast.

Do you need money? Obviously, most people wouldn’t say “no” to more money. But we’re asking if you specifically need more money to pay for your basic necessities right now.

Maybe you had a sudden emergency come up. Your car broke down or there was a medical issue or your heater gave out in the middle of winter. These are the kinds of things that need to be addressed ASAP.

But fixing this stuff can be very expensive. Medical costs and repairs—which are like medical costs for cars or heaters—can cost in the thousands or tens of thousands. If you need money to cover a financial emergency, what choices do you have?

One choice is a cash advance. But is it a good choice?

The cash advance facts.

Before we get into whether it’s generally good or bad, let’s just review what exactly cash advances are and how they work.

Simply put, a cash advance is a loan you take out with a credit card. You can use your credit card at an ATM to take out a cash advance loan just like how you’d withdraw money from your account with a debit card. The amount you withdraw is added to your total balance.

But whereas you’ll only have to pay an ATM fee (assuming you used a non-bank ATM) when making a withdrawal, a cash advance will quickly become very expensive.

The costs of cash advances.

Given that cash advances are a type of loan, it shouldn’t surprise you that you’ll be expected to pay it back with interest. What might surprise you, however, is the cost of said loan, and the ways it differs from using your credit card normally.

“There are loads of challenges with using credit cards for cash advances,” warned David Gafford, Co-Founder of Shift Processing (@ShiftProcessing). “For starters, there’s the cash advance fee that many issuing banks have placed on any cash advance taken from their card. We’ve seen anywhere from $2 on the low end all the way to 5 percent of the transaction value. That’s a hefty sum depending on how large of a cash advance one might need.

“Another challenge is the much higher interest rate on any balances carried on a credit card. For a credit card cash advance, you’re willingly taking on one of the highest interest rates available for that sum of money.

“A third reason, and one of the strongest, in my opinion, is that cash advances start tabulating interest on the advance as soon as the money hits your account. With most credit card purchases, the cardholder will have a full month before interest is charged, but in the case of a cash advance, it begins instantly.”

And he wasn’t the only one who raised the alarm about how quickly interest will accumulate on a cash advance loan.

“Most credit cards have a grace period, and as long as you pay your balance in full, on time, every month, you can avoid paying interest and additional fees,” explained author Sharon Marchisello (@SLMarchisello).

“But unlike regular charges on a credit card, a cash advance starts accruing interest the moment it is posted. This puts the account on ‘the interest train.’ So even if you pay off your statement balance on time when the bill comes, there will still be residual interest which will carry over to the following month.

“And when you’re carrying a balance, all new purchases with that card accrue interest from the moment they are posted; the grace period no longer applies. The only way to get off this interest train is to zero out the account; pay the entire balance in full (even new purchases for which payment is not yet due).”

So that’s not great! But there’s another type of cash advance that’s way more costly.

It’s a debt trap!

Cash advance payment terms may be pretty bad, but it can be even worse. Some predatory lenders will advertise their bad credit loan products as cash advances when they may actually just be payday loans.

“If an employer is willing to provide a cash advance with no interest or fees, that’s one thing,” advised explained finance writer and Middle Class Dad Jeff Campbell (@middleclassdad1). “Most people, however, rely on payday loan outlets which charge interest rates of up to a whopping 400 percent (an average of about $22 per $100 borrowed). But the shorter the loan term (in terms of how quickly they have to repay it) the higher the interest rate.

“People are obviously taking the loan because they ran out of money from their last check, but paying interest rates of up to 400 percent means that they will almost never get ahead and the cycle just continues throughout the year.

“If Joe gets paid monthly from his employer and takes out one payday loan about 10 days before the next paycheck each month, borrowing $1,000 from a payday lender, he could conceivably pay $300 in fees each month or an annual total of $3,600.”

Taking out one of these short-term no credit check loans could be even worse than taking out a “traditional” cash advance with your credit card. But just because cash advances might not be the absolute worst option, they should still be one of your absolute last resorts, if they even make your list of considerations at all.

There has to be a better way!

Borrowing from a friend or family member is likely the best option when you need money for an emergency. Your next best option is looking around for a personal loan (likely an installment loan) with the best possible terms that your current credit score will allow. Even if you do want to use a credit card, using it for a cash advance is probably the wrong way to go.

“As an alternative, we suggest that individuals use their credit card for the payment rather than take out cash,” suggested Gafford. “With the credit card charge, you still have the benefits of a full billing cycle to pay off the charge and none of the fees or instant accrued interest.

“If a credit card won’t work for the payment, we suggest putting the money on a gift card if that form of payment is accepted. Credit card cash advances are one of the last methods we will recommend to get money because of the massive downsides to this form of credit.”

Cash advances should really be your last option, if at all. Hopefully, this article has helped explain why. To learn more about how you can improve your financial situation, check out these related posts and articles from OppLoans:

Do you have a question about cash advances? Let us know! You can find us on Facebook and Twitter.

Visit OppLoans on YouTube | Facebook | Twitter | LinkedIN | Instagram


Jeff Campbell (@middleclassdad1) blogs on all things Personal Finance, Parenting, Relationships & more at He is a Dad, Husband, Martial Artist and worked for over 2 decades as a leader for Whole Foods Market.
David Gafford is the Co-Founder of Shift Processing (@ShiftProcessing), a credit card processing company. Since 2014, my industry experience with credit cards, credit ratings, card rewards, high-risk processing and more enables me to provide excellent content and advice
Sharon Marchisello (@SLMarchisello) author of Live Well, Grow Wealth, became interested in personal finance at an early age and was a long-time member and officer of the Marathon Investment Club. She earned a Masters in Professional Writing from the University of Southern California and has published travel articles, short stories, book reviews, and a murder mystery (Going Home, Sunbury Press 2014). She also writes a personal finance blog,  Countdown to Financial Fitness.

More than three years have passed since I accepted the CEO role at OppLoans, a Chicago-based fintech startup focused on providing financial options to underbanked customers. In one sense, it feels like it’s been a whirlwind. In reality, it’s taken a phenomenal daily team effort to build the business, deliver for our customers and evolve the conversation about non-prime lending.

Since November 2015, OppLoans has earned an impressive list of accolades. We have:

  •    Grown our headcount from 15 to 315.
  •    Appeared on the Inc. 500 list of fastest-growing companies three consecutive years.
  •    Expanded our footprint nationally.
  •    Collected 5k+ five-star customer reviews.
  •    Created a path to establishing credit history for millions of applicants.

I’m incredibly proud of our team; their great talent makes these stats possible. We’ve gone on a journey together that’s been deeply rewarding, even as it has revealed the stark financial reality of the country. Now, at my three-year mark, it’s the right time to reflect on the lessons learned and look to the future of our business.

My background is in financial services and entrepreneurial investing. After graduating from the University of Michigan (Go Blue!), I completed a two-year analyst program with Goldman Sachs before pursuing a career in private equity. While investing, I spearheaded an “Insuretech” thesis that brick-and-mortar property and casualty insurance agencies could not effectively serve small businesses in line with their risk profile. Shortly thereafter, my firm and I co-founded Insureon, the first online insurance brokerage for small businesses. The idea was so compelling, I decided to join Insureon full time as its number two executive. Over four years, Insureon became the fastest growing P&C insurance agency nationally.

When I was approached by OppLoans founder Todd Schwartz to lead his firm as CEO, I was intrigued, but reluctant to leave Insureon—my “first born.” Also, I was unfamiliar with the non-prime consumer landscape and was, frankly, put off by the industry’s negative stigma. But Todd, who saw the original opportunity to transform and elevate non-prime lending, was passionate and persuasive. He and the OppLoans ownership team at Schwartz Capital Group were adamant that they were providing a simple credit product with compassionate service and dignity to the underbanked at a lower APR than storefront lenders.

To be honest, it sounded too good to be true. Historically, the industry has been filled with predatory actors and products. I didn’t believe that there was a viable alternative. So I did my research, expecting to be proved right and move on. But that’s not what happened.

Our customer is the median U.S. consumer. And they are misunderstood.

To my great surprise, I learned that half of Americans have non-prime credit scores,1 57 percent have less than $1,000 in their savings account2 and nearly eight out of 10 live paycheck-to-paycheck.3  This is the reality in America today.

This financial vulnerability can be catastrophic when you’re faced with an unexpected obstacle like a car repair or a sudden expense—be it medical or family-related. In that common scenario, where do you turn? The legacy options are predatory payday loans, title loans and bank overdraft fees (the average APR on a bank overdraft is a jaw-dropping 17,000 percent!4).

Then I started studying credit cards. It turns out, the true cost of non-prime credit cards is not much better. Unlike consumer installment loans, credit cards do not have to include fees in their APR calculations. When fees are added, cards that claim charges of less than 36 percent APRs are much more expensive on an “apples-to-apples” basis.5

As an investor, I learned the best question to evaluate any business is this: Do you create material value for your customers above and beyond their next best alternative? So, does OppLoans offer a better solution? That’s what I needed to know.

Compared to other non-prime options, Opploans products can be a lower cost solution for consumers who do not qualify for traditional financing. All of our products are amortizing, so customers pay down principal with each payment. Furthermore, we report to all three credit bureaus (not every lender does) so that we can enable our customers to build credit and payment history. This is critical to our mission to help the thin-credit population build a more robust credit history.

I learned that non-prime consumers who are locked out of traditional financing are not only used to predatory products, they’re too familiar with appalling second-class customer experiences. The industry stigma is real; I know because I held the same assumptions about the non-prime lending world. I needed to become certain that OppLoans was offering a product and an experience I would be proud to champion. So I sat in the Loan Advocate center and listened to customer calls for hours.

I was shocked. On call after call, I heard customers thank their Loan Advocates for being compassionate, for treating them like a real person and for making sure that they understood the product and the payment schedule. More than once, I heard customers in tears of relief after we helped them through a difficult situation. These are not people looking for a handout. They are hard-working Americans in need who want to, but cannot, participate in the traditional credit economy.

The OppLoans customer is the median U.S. consumer. They’re not a low-income consumer; they are educated and employed, they have bank accounts and they make median wages. It’s just the reality of the country today. Our customer is both misunderstood and trapped by barriers between them and the money they need to manage and advance their lives.

It was clear that the current world of brick-and-mortar lenders could not or would not serve non-prime consumers effectively or with dignity. In November 2015, I made the decision to join OppLoans’ mission to deliver a quality product and experience for non-prime borrowers that helped rather than hurt that population.

As we evolve, we must stay true to our core strengths.

When I came aboard, I was lucky to inherit an industry-leading credit model and best-in-class customer service. Those have always been—and will always be—our bedrock assets. Growth in a lending business means nothing if delinquencies rise and service levels slip.

As we’ve scaled exponentially, we have developed and leveraged best-in-class technology, created a Fortune 100-quality C-Suite and launched new products and services in new geographies. We have also kept true to our core skills. We know that EVERY customer interaction needs to be handled with the same level of care and decency on which we have prided ourselves since the early stages. We’ve also been lucky to partner with a world-class, state-chartered bank to service products they originate nationally.

Because we know our customer, we overemphasize best-in-class customer service. OppLoans clients come to us in moments of need. They are dealing with a financial emergency that likely impacts all other areas of their life: from what they’re able to provide their children, to being able to afford to physically get themselves to work. It’s critical that we furnish responsible products to customers who have the ability to repay them, but also that we do it with an absolute minimum of hassle and an unmatched customer experience. Our products come with manageable payments made over longer terms than payday lenders because we care about our customers’ ability to repay the loan they borrow. That’s why I’m so grateful to the thousands of customers who leave us five-star reviews and comments on Google, the Better Business Bureau and other social media platforms. They tell our story better than we can and we’re grateful that they want to share their positive OppLoans experiences with others.

It isn’t always easy to maintain a smile and positive demeanor while helping our customers responsibly navigate financial turmoil. I know this because I’ve experienced it firsthand. Personally, my most important moment at the company came when I jumped on the phones to help answer calls during an incredibly busy transitional period. It was frightening and challenging. But it gave me a totally new appreciation for what our Advocates do best: address desperate situations with compassion and meaningful solutions.

It’s also vitally important that we don’t take advantage of customers in their time of need. Our products are expensive and should only be used if a customer does not qualify for better options. So what do we do to ensure that customers don’t end up borrowing through our platform solely because we have a fast approval process? Today, we are the only lender and servicer in the non-prime segment that gives applicants the ability to search for lower APR solutions before submitting an application through OppLoans.

OppLoans is a platform that guides non-prime borrowers to the best credit option for them—sometimes that means another product with a different provider. We’ll lose that business but it’s what’s best for the customer.

Financial education is also a major part of our value proposition. Our free online personal finance curriculum, OppU, generates tremendous content to help anyone better understand how to improve their financial health. This includes easy-to-understand videos on how to improve your credit score and budget more effectively.

If we continue to take exceptional care of our employees, they will keep delivering for our customers.

As our business has grown, we’ve been honored to pick up numerous “Best-Of” workplace and culture awards. OppLoans has been named:

I’ll admit that prior to my experience at OppLoans, I always thought that “Best Place to Work” rankings and culture awards were overrated. I could not have been more wrong. The last three years at OppLoans have shown me that when people are excited to come to work, they do great things, including driving outstanding customer service.

We have elected to control our growth so that we can constantly ensure we are prioritizing an excellent customer experience. In our industry, one negative customer interaction can have lasting repercussions. So, we need to make sure that every customer conversation is flawless. For these reasons and more, we’re continually reinvesting in company culture and creating a home for Chicago’s best to do their best work.

I’m unbelievably proud of not only these best-in-class customer rankings but the fact that our employees love working here. Our Glassdoor rankings and awards are clear evidence that we have created a top-one-percent culture and that’s a big reason for our success. We’re dedicated to taking care of our people, not only because that means they’ll take care of our customers, but because it’s the right thing to do.

Where we’re going next…

We may already be the only lender and servicer in the non-prime segment to proactively guide prospective customers toward lower cost solutions with other lenders, but we aren’t stopping there. We are engineering new initiatives designed to graduate our best customers out of our category and into near-prime products with lower rates. That kind of real customer advocacy is emblematic of who we are and it’s the easiest way for us to quantifiably demonstrate that our customers are qualifying for more traditional borrowing options.

But, of course, it’s easy for me, as CEO, to believe in OppLoans, our people and our mission. That’s why I always encourage people both inside and outside of the business category to not believe a word I say.  Instead, listen to the OppLoans customer. They tell our story best!

When you can go to Google or any social media site out there and read our outstanding reviews—that makes my job very easy. Sure, we can think we’re great, but when you have the third-party validation from customers, it tells us that we’re on the right track.

Over the next three years, OppLoans will become the global preeminent financial services company for the non-prime consumer. That means new products and new geographies, all without sacrificing the bedrock values of the business—our credit stability and customer satisfaction.

If you’re interested to learn more about OppLoans, explore our company culture or visit our careers page to see what we’re up to and how you can help make a meaningful difference in the financial lives of everyday Americans.


  1.  Meni, David. “The Importance of Credit Reports & Credit Scores for Building Financial Security.”, July 2016.
  2.  Elkins, Kathleen. “Here’s how much money Americans have in their savings accounts.”, September 13, 2017
  3.  Reich, Robert. “Almost 80% of US Workers Live from Paycheck to Paycheck. Here’s Why.”, July 29, 2018.
  4.  O’Connell, Brian. “Our Stupid Bank Overdraft Purchases Come With 17,000% Interest.”, October 28, 2014.
  5.  “Truth in Lending Act.” Consumer Financial Protection Bureau, April 2015.