Money Mart: Create a stress-free spring with a cash advance

While spring brings nicer weather and plans for long days in the sun, emergencies can strike at any time. Sometimes people need fast access to cash so they can cover an urgent situation, but with the cost of living increasing drastically, it’s hard to save.

When finances are tight, people tend to feel more stress, especially when they worry about making ends meet or covering unanticipated costs.

A cash advance can provide emergency funding of anywhere from $120 to $1,500 to cover such urgent scenarios. That money enables borrowers to pay for situations such as vehicle repairs, home repairs, bill payments, and other expenses they don’t have the finances to cover.

Using a cash advance smartly can help borrowers reduce their finance-related stress.

How a cash advance works

Cash advances are meant to be short-term solutions when a borrower can’t wait until payday to cover their costs and can’t put off the expense any longer. For example, replacing a hot water tank often requires an immediate fix, and plumbing companies expect the replacement to be paid for upon completion of the work. At the same time, people need hot water for day-to-day well-being.

A cash advance enables borrowers to live without worrying about how they’ll get by if an emergency arises.

Borrowers can apply for the advance online or in-store, and money can be deposited into a bank account in as little as 24 hours or by the next business day. To be eligible, borrowers must be at least 18 years of age with a valid ID and a chequing account, and they must have a steady source of verifiable income.

The loan plus any fees will be paid back the next payday, so borrowers don’t have any long-term payments to worry about.

When cash advances are useful

Cash advances are best for unexpected emergencies that a person can’t afford to cover. They differ from installment loans in that they provide less money, and the loan is meant to be paid back at or by the next payday, whereas with an installment loan, the borrower can make smaller payments over a longer time.

If the borrower just needs enough money to get through to payday and doesn’t require more than $1,500, a cash advance is usually the best option. An installment loan may be the better option if they need more money and require smaller payments.

Things to consider

Before deciding if a cash advance is best, borrowers should ask questions about the interest rate and any fees they may be charged, such as cash advance or ATM fees. They should also ask whether there are any penalties for paying the advance off early if they come into some money and can afford to.

Ideally, the borrower would be fully aware of all the costs and fees associated with the cash advance and have identified how to pay it off on or before their payday without increasing their ongoing debt load.

The bottom line

Unfortunately, unexpected emergencies arise and often cost money. So, whether it’s an important repair or an urgent trip to see a loved one, or any other sudden expense, a cash advance provides borrowers with a way to meet their costs without adding stress.