RENO, Nev. (KOLO) – ‘Tis the season for holiday shopping and financial experts with Greater Nevada Credit Union are advising shoppers to read the fine print before signing up for those attractive storefront, pay the latest options.
Options like Afterpay, Klarna, and Affirm to name a few – can be useful tools, but if you don’t take the time to read the terms and conditions you can end up with even bigger financial burdens.
“Convenience doesn’t always mean it doesn’t have an impact on your credit score or overall credit history so you want to make sure you don’t do something rash right now because it makes that big purchase more affordable but you really don’t have a plan on how you’re going to pay it off,” said Michael Thomas, Sr. Vice President at GNCU.
Thomas says that because the buy now, pay later option is a new industry, there is no real standardization between suppliers. So as a buyer, it’s important to make sure you know exactly what you’re signing up for.
“You have to make sure…is it biweekly payments? are the monthly payments? Check the installments and make sure you know when that payment is due, there has been research done as these are becoming more and more popular; “about half of all people who try one of these buy-now methods pay off their loans later and end up losing or paying late and encountering higher costs or interest that they didn’t expect,” said Thomas.
Another potential impact can be seen on your credit score, so just as you might cross those names off your holiday gift list, make sure you know exactly what you’re getting yourself into if you agree to buy now, pay later.
“It looks really easy, just one click to make a purchase, but it can take a long time to uncover the bad financial decision you’re making right now.”
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