Sure, we’re all looking forward to our tax returns this year but would you be willing to pay a triple-digit interest rate to get your own money about 10 days earlier? Well any credit counselor will tell you, that’s exactly what you will be doing if you take out a Refund Anticipation Loan or RAL.

Many of the advertisements that you see that claim to be “Instant Refunds” or “Rapid Refunds” are really RALs and are mainly targeted to those with lower incomes. If you are struggling financially but are still thinking you might need to take out a Refund Anticipation Loan, ask yourself this first: “Why would I pay someone to loan me my own money?”

Don’t give a large chunk of your hard-earned cash to someone else to get your tax refund a few days earlier than you would if you file with the IRS directly. Most credit counselors advise it pays to be patient and wait for just a few more days. You can try speeding up the process by filing your tax return electronically with E-file or have your tax return sent directly to your bank account with direct deposit.

You may also want to consider reducing the amount of taxes withheld from your paycheck but it is highly recommended that you see a tax professional before doing so. This may enable you to put more money in your pocket each pay period, rather than receiving a large refund at the end of the year. This may prevent you from relying so heavily on your tax return in the first place.

If that isn’t enough to sway you from taking out a Refund Anticipation Loan, credit counselors warn: this is a loan that must be repaid. If your refund is denied, delayed or if your return is smaller than expected, you will still be expected to pay the loan back. If you are unable to pay, the lender might send you to collections, hurting your credit as a result.

Bottom line: Refund Anticipation Loans just aren’t worth it!

Payday loans, paycheck advances, or whatever you choose to call them are a growing industry, doubling in size over the past six years to nearly $28 billion in loan volume. Family Credit Counseling Service receives many calls daily from people struggling to break the cycle of Payday lending. But are they really the best option for consumers in need of a little help until the next pay day? Let’s investigate.

While legislators try to put caps on interest rates and the maximum number of payday loans one person can have, most loan providers have found the loopholes - mostly through providing online loans. The average loan carries interest rates between 300-900% annualized. Only 1% of loans written are to consumers who can temporarily use the funds, pay the loan off and walk away; the rest fall into a deeper cycle of debt.

"OK, but what is a person to do that has bad credit and an emergency need," you say? Great question! Many reputable financial institutions are beginning to provide payday alternative loans with much more reasonable interest rates and officials are looking at stricter legislation for these loans as they tend to prey on the low and lower-middle class.

Bottom Line: If you find yourself in a financial crisis, look around for alternatives before being lured by the bright neon lights of the corner 24 hour payday advance store. Look for a reputable lender that might offer an alternative product or talk to a credit counselor to discuss what your options might be.