Trapped in Payday Loan Debt? Here’s How You Can Pay Them Off

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Payday loans are an expensive foray and the interest rates can really add up. So, how do you pay off payday loans and start saving money quickly?

Payday loans can become a vicious debt cycle and the interest rates can really add up. So, how do you pay off payday loans quickly and start saving money? If you fail to create a plan to repay your payday loan after you receive it, you may find yourself in serious financial trouble down the road.

The fact is, debit card payday loans are extremely popular for handling emergencies and situations where you need cash now, but if you aren’t careful, you can get sucked into a spiral of never-ending debt that you simply can’t escape.

In fact, 80% of payday loans are rolled over into another pay period or followed by another payday loan shortly after, according to the Chamber of Commerce.

With the influx of payday loan apps hitting the app store, the ability for anyone, at any time, to get money fast is alarming.

The good news is, there are some tips that will help you pay off payday loans faster and ensure you don’t suffer any financial issues down the road.

In this article, we will share 19 tips so you can get back on your feet and start paying them off quickly.

Why It’s So Easy to Get Buried in Payday Loans

Payday loans are so easy to get for those who need money fast. With the introduction of payday loan apps, even if you have bad credit you can likely get access to fast cash. The only requirements are that you have an active bank account and a job. A ton of companies are providing high-interest loans to people who are desperate and just need the money.

These people fall into payday loan traps are in a vicious cycle who are facing huge loan fees. Many people also borrow for the wrong reasons and spend the money on everyday expenses, and end up not being able to pay the loan back and are in debt for longer.

How to Get Out of Payday Loan Debt

Got a payday loan? See our list of tips that will help you learn how to pay off payday loans faster and ensure you don’t suffer any financial issues down the road.

Pay off Payday Loans

1. Find a Way to Boost Your Income

It goes without saying that it is easier to apply extra money to your payday loan when you have more money coming in. Whether you find a way to make more money at your current job or look for an additional job to supplement your income, increasing your earnings can help you pay off your loan much more quickly. You don't even have to look for a traditional job.

For instance, you could raise extra money by selling some of your old items on a site like eBay. Applying this extra cash to your loan can help you pay it off much more quickly. Other activities such as blogging or affiliate marketing can help you add to your income over time. If you want, you can even look for a job that you can do in the evenings or on weekends.

2. Make Extra Payments

Anytime you get extra money, consider paying it to your loan. The longer you hold onto it, the more likely you are to spend it on something frivolous. Making small payments between your monthly payments can help you tackle your debt much more quickly.

Of course, before you do this, you will need to check with the lender to make sure that there aren't any penalties for making extra payments. As long as you get the go-ahead, however, this can be a fast way to pay off your debt.

3. Consider Borrowing from Your Retirement Accounts

If you have a 401(k), you may want to think about borrowing money to pay off your loan. Although you don't want to deplete your retirement account, borrowing a small amount to pay off payday loans might be a good idea since it can save you a lot of money.

4. Work with the Lender

If you are struggling to pay off payday loans, contact the lender to see if there is any way that they can help make the process easier. Let them know that you are dedicated to paying it off and that you have a plan in place. They may be willing to work with you to lower your interest or to charge fewer fees. It can't hurt to ask.

The worst that they can do is say no. Most lenders will work with you if you let them know ahead of time that there might be a problem. Just be sure to contact the lender well in advance of your payment date so that there is time to come up with an alternate arrangement. The majority of lenders would much rather work with a customer to resolve the debt than have it go unpaid.

5. Look at All Your Debts Together

When you're bombarded with payday loans and how much you owe — it can get confusing. People typically spend the most time trying to scramble up ways to come up with the money owed by the next due date.

However, you should look at all of your accounts to get a better representation of the whole picture. By using free money management tools like Empower, you can link up all of your debt accounts and it'll show you which have the highest APRs (important to know).

You can also use Unbury me which is a loan calculator that helps you to organize payment of your debts. By clearing the amount of money you owe early, savings can be made on interest charges – and these reductions in the overall amount owed can be surprisingly substantial.

By better understanding your financial situation — you can be in a better place to find new ways to save or repay the debt even if you're living paycheck to paycheck.


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6. Prioritize High-Interest Debts

Once you have a better picture of all of your debts — you will be in a better position to take steps to better your financial stability.

Next, you'll want to see which debt has the highest interest rates — you'll want to focus on those debts first while still making the minimum payments on the other payments.

Also known as the debt avalanche method, it is a popular way to pay off debt the smart way. Payday loans are notorious for three-digit APRs, so those are likely to be paid off first.

Focus your energy on wiping out those payday loans by using the next few steps.

7. Get a Weekend Part-Time Job

While this is going to depend on your schedule and other responsibilities, a part-time weekend job is a great way to earn extra money quickly.

Even if you are just working extra on the weekends, it will pay off in the long run. Some options to consider include delivering with DoorDash, which you can do if you have a car and want to deliver food around your city.

This will let you make quite a bit in a short amount of time. There are a number of other gig economy jobs to choose from to make extra cash, as well, so be sure to look carefully.

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8. Borrow Money From Your Friends and Family

While there are some people who may be embarrassed to ask people they know for a loan, it can be quite beneficial in the long run. This is especially a good idea if you find that you are not able to make the payments as they are required.

Getting behind on just one payday loan payment can lead to quite a bit in fees and penalties.

In some cases, your family or friends will be more than happy to help with your financial situation. This will also help you avoid having to take out several payday loans at a time.

9. Sell Your Old or Unwanted Items

Thanks to the internet, there are more than a few online auction sites, such as eBay, Craigslist and even selling sites through social media channels where you can sell the stuff you no longer want or need.

If you are planning on selling items on selling sites such as eBay, you need to make sure that you take into account the shipping charges – especially if the item is unusually heavy or large.

In these situations, it may be better to post the item on local selling apps so that you don’t have to ship it anywhere. You probably have a lot of stuff lying around that can net you quick cash and you don't even realize it. You can sell your old laptops, DVDs, and even used clothes for quick cash.

This is an effective way to quickly get the money you need to repay your payday loan.

10. Ask Your Employer for an Advance on Your Pay

If you work with a great employer, then you may want to consider asking them for an advance on your paycheck.

While this may not be possible with every employer, it is a great way to get extra funds when they are needed. Usually, if you work at a smaller company this would work as opposed to a large organization with set rules in place.

Also, you won’t have to worry about being on the hook for yet another payment, since the amount that you receive ahead of time will simply be deducted from your next paycheck (payroll advance).

Make sure to factor this in when considering your other bills so you don’t find yourself in another financial bind next week.

11. Ask the Lender about Extensions for Your Payments

There are a number of payday lenders that will extend your payments if you ask. While this may come with a number of fees and other penalties, it never hurts to ask and may help you avoid getting late on your payments.

Make sure you ask about all the stipulations related to receiving an extension on the payment, since this may impact you down the road.

When it comes to taking out a payday loan, there is no question that it can be beneficial if you need money in a hurry.

However, you need to make sure you can repay the loan when the payments are due.

12. Consider Paying Payday Loans Off Early

Some loans have a penalty if you pay them off early. Check the terms of your loan to see whether or not you will be charged extra money for paying it off ahead of time.

If so, spend some time crunching the numbers to see whether it will cost you more to pay it off early or to pay interest over the life of the loan. That way, you can decide which option will save you the most money.

13. Find a Guarantor

A traditional loan or even a guarantor loan is going to have a far lower interest rate than a payday loan. So, if you can find someone to be a guarantor you can take out this sort of loan at a lower rate, payback the payday loan and save on the high interest rates.

14. Negotiate a Lower Rate

In some cases, lenders may be willing to offer you a lower interest rate. All that you have to do is ask. If you can convince a company that you are working hard to pay off your debt, they may be willing to work with you to make the process easier. You will be able to pay off your loan much faster if the interest rate is reduced.

15. Consolidate

Consolidating your payday loans can be a smart way to cut down on your payday loan costs and help you cut down repayments. This sort of thing is especially useful if you have more than one loan, or a loan that has run away in terms of interest.

16. Tap Into Your Life Insurance

The primary advantage of payday loans is that you can get access to the money very quickly. This is extremely beneficial in emergency situations. Once the emergency has been dealt with, however, you can focus on finding ways to pay that money back. One option is to tap into your life insurance. Although this will decrease your payout in the future, it is usually a much better option than paying a ton of money in interest on a payday loan today. The interest rates on life insurance are exceptionally low, which is what makes this option a good choice.

About the author

Brian Meiggs
Hi, I'm Brian Meiggs! A personal finance expert, entrepreneur, and the founder of My Millennial Guide. My drive is to help others unlock the wealth of freedom and pave the path to financial success. With my bachelor's degree in finance, I help millennials follow the smart money in order to increase their earning potential and start building wealth for the future. I write regularly about side hustles, investing, and general personal finance topics aimed to help anyone earn more, pay off debt, and reach financial freedom. I have been quoted in major publications including Business Insider, Yahoo Finance, NASDAQ, Discover, GoDaddy, BiggerPockets, Fox News,, Quick Sprout, Money Geek, MSN Money and many more!