Get your paycheck before payday with the Earnin app
Are you in cash flow crisis? Find out how payday access apps like Earnin can help close this cash flow gap.
You are in a cash flow crisis again. A large bill is due and you have earned the money to pay that bill, but it is not payday yet. You are on a two week pay cycle and have to wait another week or so for your money to become available.
What are your options? Ask a friend or relative to lend you money for a few weeks. Take out a payday loan and pay painful interest rates. Make the late payment and run the risk of penalty fees and a drop in your credit score. Ask your employer for a payday advance. All of these options can be embarrassing and unpleasant.
Many Americans are taking the payday loan approach – about twelve million each year, according to a 2016 Pew Charitable Trusts study – by collectively paying $ 9 billion in fees and interest.
Payday access apps like Earnin are designed to fill this cash flow gap. Unlike a payday advance or a payday loan where an employer or a third party loans you money for future income, Earnin allows you to access the money you have already earned almost in real time.
To use Earnin, you will need to offer a connection to your bank account and provide employment information. Most banks support the Earnin app, including large institutions like Wells Fargo and Bank of America, but check with your bank or credit union before signing up for the app.
Once you have registered and provided the necessary information, you will be able to access each shift’s funds by “cashing out” by tapping on your phone screen. The funds will be deposited in the bank for your use. Timesheets are not needed, although if timesheets are used, the app can take them into account.
New users should immediately try a small withdrawal to check for issues or unexpectedly slow transfers. Each transfer step must be almost instantaneous, but publication delays are possible. In a pinch, check the system before you need it and assume that it is immediately available.
How does Earnin make money? Users provide assistance by “tilting what they think is right” according to the app’s description on the Google Play Store.
Some employers offer alternatives to Earnin as part of a benefits package. PayActiv and FlexWage are employer programs that allow similar privileges to access money as it is earned.
FlexWage uses a reloadable debit card attached to your direct deposit account. The account is integrated with the employer’s payroll systems, allowing access to money already earned, although there is a flat fee of $ 3 to $ 5 for each advance transfer. PayActiv charges a monthly fee of $ 5, but this fee also includes access to budgeting tools and bill payment services.
Employers must register to provide the FlexWage or PayActiv service. If your employer hasn’t signed up for any of these services, Earnin may be your best bet for accessing your earnings before payday.
Apps like Earnin can save money by closing a cash gap. You won’t have to make a tough decision between sky-high interest rates or potential late fees and bumps on your credit report. You can check your credit score and read your credit report for free within minutes using Credit manager by MoneyTips.
However, there is another alternative to consider that is open to everyone: an emergency fund.
Examine your budget for areas where you can cut spending and divert savings to an emergency fund. (If you don’t have budget, here’s the problem – so make one now.) It won’t be easy, but it will be worth it. Eventually, saving will become a habit, and you will have peace of mind knowing that you can easily handle a temporary financial blow.
This article was provided by our partners at money advices.com.
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