It’s the 14^th of January 2013, approximately 17 days to the end of the month. For those of us who are already broke, that salary advance looks quite enticing.

So long as you have a good credit record, getting a salary advance can be as easy as ABCD. From your employer to your bank, from a SACCO to a micro finance institution, you can practically get a salary advance anywhere at “attractive” interest rates and at times no interest whatsoever.

However, what should you consider before rushing for that salary advance?

Factor in other emergency expenses

You will probably have every intention of paying back your salary loan once your next pay cheque goes through. One question rises, what happens when an unexpected even occurs that results in draining even more of your money, making it impossible to pay off your loan?

You or a dependent family member could fall sick; your car could break down requiring argent repair. We all risk falling victim to financially demanding emergencies. Unlike other types of debts, salary advances may come with short duration of payback time. If you unable to pay back the loan on time, it can be costly.

How much should you borrow?

Different finance lending institutions have different amounts that they can give their clients in form of salary advance. There are institutions where you can borrow up to 50 percent of your gross salary while there are others where you are only limited to 15 percent of your gross income. No matter how financially desperate you are, the trick is not to borrow more than you can pay back.

Begin by factoring in the duration you have to pay back the loan. If it’s a month then you should limit yourself to the utmost minimum. Remember that you still have food, rent and utility bills to think about next month. Premiums’ deducted from your salary to pay back the loan should leave you with a sufficient amount to settle your other expenses.

Interest tied to the loan

It is important to factor in the interest tied to the loan. It can be very frustrating to learn that most of what you are paying back is interest as opposed to the amount given to you.

Given the fact you have a wide pool of financial institutions to borrow from, here I’m talking about banks, SACCOS, micro finance lending institutions and even your employer, fish around for the option with the most attractive lending rates.

Only borrow when it’s absolutely necessary

If you have the option of limiting yourself to a tight budget in order to make ends meet then go for this option. There’s nothing as satisfying as living a debt free life. If anything you have 17 days to the month, it’s better to struggle now and have a financially friendly February as opposed to struggling in February since you are paying back a loan borrowed to sustain you in January.

What options do you have when you can’t pay off the loan, in full, within the allocated period?

As noted earlier, there are financially demanding emergencies that may render you unable to pay back your loan on time. Discuss with you lender the options you have if you are unable to pay back the loan on time. Some lenders will let you roll over the loan, or the portion you are unable to pay until the next pay period. You though find yourself forced to pay additional interest when you do so.

In as much as a salary advance loan may come in handy during such tough financial times or enable you to meet some of those unforeseen expenses, only borrow when you absolutely have to always have a payback plan before taking the loan.

Then again, maybe you shouldn't have partied that hard over Christmas.