After racking up thousands of dollars in debt, some borrowers are deleting the apps from their phones to avoid getting prodded to spend more.
Many consumers find buying now and paying later a godsend when cash is tight. Others are wishing they’d paid upfront to avoid pain later.
Tia Whiteside, 27, knew she was spending more than she would have without buy now, pay later services — the popular loans that let borrowers split purchases into installments with little or no interest. Planning a day trip to the beach with her 2-year-old son last year, she spent $800 on Amazon purchases including a tent, new outfits and a high-end sandcastle kit with the BNPL provider Affirm.
Whiteside, a Greenville, South Carolina-based behavioral analyst who treats childhood autism, makes good money; she and her husband bring in about $110,000 per year combined. But the $6,000 in BNPL loans she’d racked up over roughly two years felt frivolous, she said, especially because they’re planning to buy their first home.
“I was just seeing my paycheck continually eaten up,” said Whiteside, “and I was like, ‘Where’s my money going?’”
$800 on a day trip to the beach?? Thats insane to me.
Also never understood why anyone would you those options, they have always seemed like trap. Have some self control
Why do you even need a tent for the beach? Are you camping out there overnight?
I imagine it’s more of a canopy than a sleeping tent. Something like an EZ up tent that provides more shade than just an umbrella.
I’ve used them and they’re pretty nice, especially if you’re going to be at the beach all day and don’t wanna get sun burned. That being said, it’s still a big purchase for just one day trip. I’d only invest in one if you were using it regularly, or had like a week-long trip planned.
I think I’ve seen those before. And I believe when I did, they were renting them out for the day like they do with chairs and umbrellas. Which I’m guessing is not uncommon at beaches.
Yeah, it would make much more sense to rent one for a day trip. Even a week vacation honestly.
I honestly don’t understand why anyone thought “buy now pay later” was anything new. Usury is among the earliest professions.
Says “no interest”, so it ain’t usury
A high end sandcastle kit?
Idiots spend money they don’t have. News at 11.
So you shouldn’t take super high interest loans to buy crap online?
Planning a day trip to the beach with her 2-year-old son last year, she spent $800 on Amazon purchases including a tent, new outfits and a high-end sandcastle kit with the BNPL provider Affirm.
Nvm it was clearly unavoidable.
That report also found Black consumers were 65% more likely to borrow on BNPL than the general population, followed by Hispanic consumers (47%) and female consumers (35%).
Also racist and sexist 🤡
Why is that statistic racist and sexist? Sorry for not getting it.
It was sarcasm…also if you add black, hispanics and women together, you basically have the general population except white men.
Why would you add those together? They aren’t distinct groups. They overlap.
So you shouldn’t take super high interest loans to buy crap online?
In Netherlands they limited the maximum interest rate. Plus borrowers should check if people are credit worthy without that credit score. Basically it is assumed there are enough people who are terrible with their finances. The last bit is preferable over victim blaming.
I have a 800-810 credit score. I have positive networth. I have no mortgage, no student loans and one car loan with less than 5k left. The best interest rate on a credit card i could find was over 18%. I didn’t actually apply so the rate might go lower but still, that’s criminal imo.
I had a 7.99% fixed card for a long time. Then after having a few kids we didn’t use it for a while and I went back to look at it they had raised the rate to 15.99% (this was years ago now). We also have credit over 800. Absolute garbage (yes, I know it’s in the TOS). Dropped them and changed companies to get the same 15.99% rate with other perks since the original didn’t have any.
These CC companies seriously need more regs. They can’t be trusted to do anything in the interest of consumers and don’t deserve their business anymore, quite frankly.
In Australia, at least at the beginning, bnpl services managed to bypass all money lending regulations based on the fact that they don’t charge interest. I know that there were discussions about fixing that but haven’t been following the topic in a while.
Like the other person, I also assume you meant lenders, not borrowers. Lenders WANT people that are terrible with their finances. Visa makes very little with me paying off my credit card in full every month, just some merchant fees. On the other hand plenty of Australians are in constant credit card debt and pay something like 18-22% interest on the money they borrow.
Good on the Dutch government to try and control that.
That’s pretty recent I think - and it’s only limited to like 30% I think ?
The main issue is parents (and the school system) aren’t teaching kids about budgeting and how CCs work because they don’t know how it works either. It’s perpetuating.
People have completely lost track of what wealth looks like and it’s not their fault. Using UK numbers cause that’s where I live:
- salary for a 21yo in 1970 for a white collar job: £1861 - £24k adjusted for inflation. Pretty on par with today’s salary for a starting white collar job.
- price of the average house in the UK in 1970: £4378. About 3 times the above annual salary. Adjusted for inflation that’s £57,491. The average price of a house in the UK right now is £260,000 after dropping from 300 due to current market. 10 Times the annual salary.
You go to work at least 8 hours a day 5 days a week, in a culture that’s indoctrinating you that you should be thankful you even have these horrible work conditions and pay, you spend half of more of your income on a landlords mortgage payments + extra, and for what? So you can’t even afford to buy a damn games console outright and drown your sorrows in a virtual world?
Yeah no shit their overspending, they just want to live a little of their life when they can but they can’t even afford to do that.
And to everyone that’s about to write “well if they would budget better” kindly fuck into the sun. First of all not everyone should be an accountant in order to live comfortably. A lot of people simply don’t have the skills necessity to do it. But more important, a full time job should be enough to provide for yourself, your family (1 spouse 1 child) and a mortgage on a house or apartment suitable for this family of 3. Not because I feel like people are entitled to this, fast from it, but because this was the norm 55 years ago. This was the normal for my grandparents. Society is supposedly evolving. The first world countries where this was the norm have, supposedly, grown their economies by A LOT. How can it be possible that the majority is worse off than 55 years ago in a more modern society and in now a lot more advanced economies.
But the answer is very simple really isn’t it. You can’t afford a house or a car made in the last decade while the rich are having literally privatised space races. Space races were exclusively the hobbies of nuclear superpowers, funded by taxpayers. How exactly did private individuals summon up the funds to advice this?
Well, you fill in the dots…
The only purchase I’m willing to go into debt for is a house and a car. Anything else I spend on should be something I already have the money for. I don’t understand how some people are willing to take out loans for miscellaneous things that aren’t even necessities.
Well medical care is not house or car but needed.
For sure. I forgot to include that, since it’s a necessity after all.
I think it’s a gray line for some folks. I recently got my first credit card and I use it for all day to day expenses. It’s amazing how easy it is to get side tracked while spending. You only having to down pay a certain amount of the outstanding credit and the limits are set by the provider not you. If i didn’t keep monitoring it I think it’d be really easy to get a bill one month that just eats out all my other income.
Apparently a lot of people are going into debt for the sake of “keeping up with the Jones’s”
They’re literally putting themselves into tens of thousands of dollars into debt for an iPhone or shit like that. It completely boggles my mind how you could destroy your entire future for extremely short term gains.
Instant gratification has gone too far too fast
$55,000 is good money?
Depends on where you live
Well if it isn’t then more than half the country is making bad money: https://fred.stlouisfed.org/series/MEPAINUSA672N
More than half the country is making bad money! We’ve been ripped off since the 70s. There was a Time article a few years back that calculated how if wages had kept pace with productivity, like it did up until the 70s, then Americans would be $50 trillion richer. Instead that money went to the rich. The rich has scraped off the $50 trillion in wages from the working class and that’s why everyone is paycheck to paycheck.
I make $50,000 and I live alone in a 3 bedroom house (a fixer upper but decent enough) which I own in a decent part of my not even terribly small city (~50,000 people). And I live comfortably enough even though I put very little effort into budgeting. Only 3 years ago I was still living in the same house/area off of $30,000 and even that was technically livable. $55,000 in my area is decent money as long as you don’t go completely wild with it and it’s downright great in a dual income household. There are also areas of the contry that have an even lower cost of living than mine.
Once you get out of the metropolitan areas money usually stretches much farther.
ITT a breath of fresh air. I am not alone in having an interest in personal finance, and understanding the basics of it.
Most of my interactions on lemmy so far have been making me feel guilty (and downvoted) for saving some money like I was a dirty billionaire, and to invest in index funds, using capital to further oppress the masses.
