What if you suddenly have to find a way to pay your bills for an unforeseen emergency?
You might be eligible for a salary advance on your next paycheck to cover an unplanned and sudden expense. Many employers don’t offer salary advances, but some actually do. Company procedures and rules vary greatly. When you need a payday loan to cover medical bills, transportation or groceries, your employer’s policies may not allow a salary advance.
Your employer may say you can only make the emergency payment using cash, check, certified cheque or cashier’s check. If you are a member of a group that receives a wage increase or if you are eligible for collective wage increases, some employers will allow wage advances. These payments are made automatically once the regular monthly paycheck is issued. Wage advances are paid in less than one week, so it takes longer to repay them. Because this type of payroll advance is considered a loan, interest and fees will be charged on the amount borrowed.
payroll deductions for emergency expenses
Your employer may not allow payroll deductions for emergency expenses. To apply for a cash advance, you will probably be asked to provide proof of your income and employment. If you are a part-time employee, you are usually allowed up to 12 weeks to repay the advance and to start your period of repayment. In addition, you will be charged interest on the amount borrowed plus interest charges.
You may want to consider asking your employer if they have something like a sick pay or vacation pay available. This can cover your emergency expenses until you get your next paycheck. The company policy may specify how much time you have to repay the advance. It may also say that your employer can direct deposit your payments to help avoid missed or late payments.
flexible spending account
Ask your employer if they offer any type of flexible spending account. Some companies will allow employees to keep their check book balance secure, without restrictions. With salary garnishments, penalties, and other issues arising from paycheck advances, having some flexibility with the money that comes into your bank account is important. Payroll advance lenders usually do not provide this flexibility.
In the first paragraph of this article, I stated that you should be careful when requesting a salary advance. In the second paragraph, I explained why this should be done only in an emergency situation. In the third paragraph, I described the type of situation that would warrant your use of a salary advance. In this fourth paragraph, I am going to explain why a salary advance is appropriate in many situations. Hopefully after reading this article, you will know what to do in each of the four paragraphs.