Check cashing services (sometimes known as a payroll check cashing service or an advance check cashing service) are great things when used properly, but all too often, they are not used properly. In fact, those who run a check cashing service rely on the people who need a check cash advance and use them improperly for the majority of their business.
What exactly is a check cashing service?
A better name for these would be a “cash advance check cashing service,” because that’s usually what they’re used for. They aren’t used for check cash services as often as they are used for cashing future checks. They give money to a person who is requesting a money advance, and they charge him or her enormous interest on the loan; check cashing service fees are higher than even credit card fees. Check cashing services use specialized check cashing software to make the transaction as smooth as possible for you.
Typically, the person will pay off the loan with the next check, but he or she will have nothing after that. Therefore, he or she is forced to take another advance. This cycle is hard to get out of, and it is a nasty one to be in. They come in all varieties; some make it personal by calling themselves a personal check cashing service, while others are available any time of day, such as a 24 hour check cashing service.
What are they good for?
They do have their place, however. In the unfortunate event of an emergency, you may find yourself cashless when you need it most. A cash advance from a check cashing service may be just what you need at that point in time. If you handle your finances properly, you should be able to get out of the cycle pretty quickly.
How do you get out of the cycle?
To get out of the check cashing cycle, you have to spend less and pay off the service. It’s easier said than done, but that’s the answer. You have to spend less. Period.
If you can do this, you should be able to break out of this cycle within a few paychecks, and you will feel a lot better about your financial situation once you do.
Ethics behind check cashing services
It is often thought that these places are made to take advantage of those who cannot control their spending. This may be true, but without them, these services would not be available for those of us who can control our spending in the event of an emergency.