I watch Toledo TV news, so I’m seeing some of the marketing campaign that the Ohio payday loan industry has put on the air in recent weeks. The campaign is an attempt to battle efforts at the state level to restrict their business. (May 6 Columbus Dispatch story)

One of the ads I saw this morning showed a man who said he never used payday loans, but complained about the possibility of the government restricting financial choices.

I’m shouting out to you Ohio residents (and Michigan residents by ripple effect):

There are already government restrictions on payday loan services - courtesy of Uncle Sam!

As of Oct. 1, 2007, anyone who receives a military paycheck has restrictions on payday loans and - as some found out this spring - tax refund anticipation loans.

I blogged about this situation last fall, and you’ll find a report at Military.com, which is a very popular e-news service aimed at military families.

A snippet from the Military.com article:

“It’s a big problem for commanders, because what happens is often these households get themselves in over their heads,” Chu said. “They’re $200 short between now and next payday, but they’re no better off when payday comes, so they need a bigger loan, and it just goes downhill from there.” …

“The first defense here … is good education for our people so they understand better how to manage their finances wisely, so they don’t get themselves in trouble and so they don’t come up short at the end of the month or the end of the pay period,” David S.C. Chu, undersecretary of defense for personnel and readiness, said. “But if they do, they know where to turn and how to get help.”

This regulation is important because financial readiness directly affects mission readiness for military members, Chu said. If a troop is worried about an unpaid credit card bill, a needed car repair, or any other financial crisis, he won’t be able to focus on the mission.

If payday loans have caused so many problems for military families that restrictions had to be imposed by the people who issue their paychecks, then civilian families also should take notice.

I can hear some of you saying, “Yeah, right, that’s fine for people who make a lot of money to say. But I’m living paycheck to paycheck!”

Reality check: The way to avoid payday loans is not in how much money you make, but in what you do with the money you make.

As we’ve seen in recent years in southeast Michigan, it’s just as possible for someone who earns $150,000 to be foreclosed on his house as for someone who makes $60,000.

Yes, people do make stupid financial decisions on occasion. I’ve already mentioned on this blog that I used tax refund anticipation loans in 1990 and 1991; and that I signed up for a college student consolidation loan with increasing payments that turned into a nightmare (yeah, it was a lot like those adjustable mortgages).

But there is more information available than ever before to the general public on how to manage your money, how to shop smart and find great deals, how to DIY tasks around the house, how to avoid getting ripped off, how to find emergency financial assistance for your situation, how to get the best possible prices on prescription drugs, which credit cards are the best ones for which consumers, how to improve your credit rating so your loan rates are more favorable ….

And much of that advice is free.

Start clicking your mouse on the links and blogs on my blogroll.