Archive for February, 2009

Savings Up; Short Term Loans Still Critical in 2009

Posted by YadYap in Payday Borrower on February 21st, 2009

Most economists are predicting 2009 to be one of the hardest years the economy has seen in decades. The following points appear as polar opposites, but will work together to help people make it through the tough times ahead:

Americans are saving more and spending less
Affordable short term loans are critical for helping people stay on their feet

American’s are starting to save more according to an article in the New York Times titled “Consumers Are Saving More and Spending Less.” An increase in the savings rate will slow the economy in the short term as businesses will see smaller revenues. However, more saving will bring long term benefits to the overall health of the economy.

The smart way to use debt is not using it to acquire things you cannot afford, but rather using it as a tool where taking on the debt makes more sense than the alternative.

Debt is a much needed and very useful strategy in our world. For example if I need a car to commute to my job (if there is no public transportation available), but do not have the cash on hand to buy one, it obviously makes sense to use debt in order to have a job and make money.

At the same time there must be a balance between spending, using debt, and saving. The increasing savings rate is good! We want people as a whole to have some security or back up if they have expenses that exceed what they can afford to pay from their income.

You may wonder why this is coming from a company that is offering short term payday style financing. Regardless of the overall savings rate in our economy, or if the economic state is good or bad there will always be a need for an affordable short term financing solution. We do not currently believe there is such a solution available.

YadYap encourages saving and at the same time using debt wisely. We are committed to offering an affordable product that will allow our borrowers to make it from payday to payday when there is not a short term solution that is better for them. In the year(s) of economic uncertainty ahead many people may be faced with simply getting by until better times arrive. This is where YadYap comes in to offer the best solution for them.