Budget – Buy Now Pay Later

Buy now, pay later. No rush, take your time to pay. Enjoy first, pay later. Buy what you love, pay at your convenience. Shop smart, pay slow. Buy now, stress free payments ahead. No rush, take your time to pay.

Budget for Buy Now Pay Later

You get the idea; all of the above phrases mean the same thing – “Buy Now Pay Later.” Under the very old system, many of us bought items on tick or layby. When I was younger, if I couldn’t afford something, the store would hold it for up to three months while I paid it off. Now rather than the store keeping your goods, you take them home immediately under the arrangement between you the store and the ‘buy now pay later’ provider such as Klarna or Afterpay.

General Terms of BNPL (Buy Now Pay Later)

• Four instalments.

• First instalment paid on date of purchase.

• Followed by three instalments, 2 weeks apart.

• No interest is charged.

• Penalties apply if instalment is late or unpaid.

• Penalties affect your credibility.

Remember these are general terms only. Ask your retailer to explain the terms or read carefully terms and conditions for online purchases.

Payments made to Temu and Others

I read Temu offerings for sporting goods, yard maintenance tools and electronic accessories. For the price and quality, I’ve been pleasantly surprised and happy with my purchases. Payments are made on my behalf via my BNPL provider – Afterpay. Using a BNPL to make your payments has the big advantage of having your financial details with a provider you trust. These BNPL providers include Mastercard and PayPal who offer the same services as Klarna and Afterpay.

Budget

BNPL is a very useful tool to purchase big ticket items or goods of lessor value, if it functions within your personal or family budget. I have an excellent washing machine that has provided reliable service for at least 10 years. It is showing some wear and may need replacing in 2 years or so at a replacement cost of $1000 to $1500. It would be within my budget to split the cost over four instalments.

Needs v Wants

This is an excerpt from ‘A Brother and 7 Siblings,’ Netflix with English Subtitles

Boss – “Living and lifestyle expenses are different. You should be paying for their living expenses. Not their lifestyle. The cost of basic necessities to live. Money for food, accommodation and school. Take care of those. But the lifestyle? To buy a new cellphone… to hang out at some coffee shop… don’t worry about it. You can calculate living expenses. But lifestyle… If we keep following it, it’s endless.”

Summary

Weather using BNPL providers or not, determine what is a need – what is a want. Most important – stay within your budget.