Buy Now, Pay Later Pain – Part 1

Do you buy now and pay later?

“Buy now – pay later” plans like PayPal, Klarna, Affirm, and Afterpay are very popular, but users are spending more than they can afford and subjecting themselves to complicated, multiple payment dates. Some regret their purchases but have trouble with returns or refunds. In addition, accounts are being hacked, and payments are not always credited correctly.

Bankrate conducted a survey and found that the appeal for this type of financing was far-reaching. Usage is nearly consistent across all income levels. Nearly a third of Americans have used it for at least one purchase. The appeal includes smaller payments to stretch cash flow. Plus, it’s easy to obtain credit with a low or no interest rate along with predictable payments. In March, Klarna and DoorDash announced a partnership enabling customers to eat now, pay later. Customers can either pay in full, in four interest-free installments, or at a time that aligns with their paycheck.

David Sykes, Chief Commercial Officer of Klarna, said, “By offering smart, more flexible payment solutions for groceries, takeout, and retail essentials, we’re making convenience even more accessible for millions of Americans.” Well, that convenience comes at a high price! People can be burdened with drawn-out payments at higher interest rates. The solution is for people to exercise restraint and live within their means. Contentment and delayed gratification prevent what I call “buy now, suffer later”.

Overspending, greed, and idolatry can lead to credit card debt. Christian Credit Counselors can help. They’ll create a debt management plan specifically for you. For more information, visit online at crown.org/ccc.