Diary of an (Almost) Buy Now Pay Later User 

In many areas of my life I am fearless. I take risks! Once I mixed Greek yogurt into my coffee just to see what it would taste like. It was disgusting, but I wasn’t afraid. 

However, this fearlessness does not translate to finances. Take paying for things in four equal installments, for instance. When it comes to Buy Now Pay Later, I am terrified. 

A Background on Buy Now Pay Later

In the grand scheme of things, Buy Now Pay Later, often referred to as BNPL, is fresh on the scene. BNPL services started popping up in the early 2010s but became more popular during COVID-19, when people’s only choice was to buy things online.

True, BNPL does allow you to take your purchase home, whether virtually or physically, right after you make the first payment. And it doesn’t come with the same hard inquiry that other credit products require during the approval process.

However, BNPL comes with its fair share of baggage. I recently tried to walk the metaphorical Buy Now Pay Later plank and use Affirm for the first time. Here’s how it went.

My BNPL Experience

To set the scene, I was buying a serum on Amazon (Caudalie Vinoperfect Radiance Serum Complexion Correcting, for those playing at home.) It was about $80, admittedly a splurge, but it came highly recommended and I’d already decided it was worth it for me.

During checkout, I was met with the familiar, yet unknown, option of paying with Affirm, which sat in small font just below the Add to Cart button. I thought: It wouldn’t be so bad to break the bill into several smaller installments. So I clicked it.

The first thing that scared me: When I clicked the little Affirm button, I was directed to a different window for the small-loan approval. I felt like I was getting separated from my friends in a crowded club. Why couldn’t this business be taken care of in front of the other payment options in the window I was in? What couldn’t they see?

Nevertheless, I proceeded. I was then asked for the last four digits of my Social Security Number. Mom always said, “Don’t give out your Social Security Number willy nilly,” so initially I was stumped.

Here’s what I settled on: While it’s always important to be wary of where you’re inputting your personal information, this is the world that we now live in. Financial products can be virtual, secure, and ask for your Social Security Number — they are not mutually exclusive. Albeit hesitantly, I bit the bullet. I decided that for a radiant complexion, that was simply the price I had to pay.

Almost immediately, I was approved for the short-term loan. One step closer.

As I stared at my two options, my commitment issues got the best of me. If Affirm wanted to lock me down for the next 3-6 months, they would have to buy me a drink first.

In all honesty, I know myself. After paying the initial $12.26 today, I would pretend those other payments simply didn’t exist, which would set me back on my budget for the new month or so. Or worse, if my bank account balance dipped too low, I could risk overdrawing my account on future installments.

The overthinker in me took it one step further: What if I catch the Buy Now Pay Later bug? What if it changes the way my brain thinks about what I can and can’t afford, and suddenly I am buying outrageously expensive items because in my mind, everything is now a quarter of the price?

It may sound crazy, but I know I wouldn’t be the first to devolve into never-ending BNPL payments.

BNPL isn’t just convenient. It’s wildly convenient, and it’s a good alternative payment method if you use it responsibly. It provides financing options for those who can’t or don’t want to go the traditional credit route.

However, it’s important to remember that BNPL is still a form of credit — a short-term loan. And as with any other credit product, there are several things to keep in mind before accepting the terms.

Understand the Big Picture

Whether you read about it or listen to it, educate yourself on the workings of BNPL. That includes both the advantages and disadvantages. Just because BNPL is a payment option at checkout does not mean that you have to use it.

As with other forms of credit, people have unfortunately found themselves in dicey situations with BNPL. No one likes to read the horror stories, but also, no one said finances would be a walk in the park.

Make an Educated Decision

If you’re using BNPL, make sure that you’re using it for the right reasons (maybe channel your inner Bachelorette contestant).

You might want to use BNPL if:

  • You do not qualify for a credit card or have a credit card with a low limit
  • You want to purchase a big-ticket item
  • You have a good handle on your spending and self control

You might not want to use BNPL if:

  • You have a tendency to overspend or can’t avoid the temptation
  • You are trying to build credit
  • You have an unpredictable pay schedule and are unsure that you’ll be able to pay your installments on time

You should also know the terms and conditions of whichever BNPL service you’re using. Nothing’s worse than missing a payment and footing the bill for a surprise late fee plus interest.

Set Up a Payment Plan

Someone important probably once said, “With splitting a great purchase into four equal installments comes great responsibility.” Clicking Purchase is but the first step in a series of financial responsibilities.

Everyone knows that one downside of credit cards is the interest and fees that come with it. Although some BNPL services pride themselves on being fee-free, there are still negative financial consequences if you miss a payment.

Know Your Shopping Habits

Not to get all hippy dippy, but you should take a look inward. If you have a tendency to overspend on nice-to-haves, it may be best to avoid BNPL until you’re sure that your self control will win out.

In Conclusion

Spoiler: I did buy the serum — just not with BNPL. Considering the price tag, the potential negative conequences associated with BNPL, and a deep understanding of my own shopping habits, I decided against it. That’s not to say that I won’t take the BNPL plunge in the future.

If (and when) that time does come, I’ll take the time to read up on the BNPL company’s terms and conditions, make sure that I’m in a stable financial position to afford the purchase split over several installments, and only proceed if I feel confident that my BNPL spending won’t spiral out of control.

Cushion helps you waste less money, save more, and live a financially healthier life. We monitor your bank and credit card accounts 24/7, find and alert you about pesky fees, let you know which fees are negotiable, which banks are cooperative, and can even automatically negotiate on your behalf.* To date, Cushion has secured customers more than $13 million in bank and credit card fee refunds—and we’re just getting started.

*Cushion only negotiates fees with high refund odds. We cannot guarantee any negotiations, a regular frequency of negotiations, or fee refunds—your bank makes the final call.

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