Buy now, pay later? Financial expert wants you to think twice

Several financial institutions are offering a “buy now, pay later” scheme which is a tempting way to purchase items without having to fully pay them up front and sometimes at zero interest.

But an expert suggests thinking twice before availing such an installment plan especially this holiday season.

“Pinipilit ka niyang bilhin mo na ngayon yung bagay na pwede mo naman ipagpaliban pa. Ang ginagawa actually ng nagbebenta sa’yo ay sinasanay ka niyang umutang. Kahit zero percent [interest] ‘yan, ‘buy now, pay later’ ‘yan, walang patong, utang pa rin ‘yan,” said financial advisor Vince Rapisura in Vonne Aquino’s report in “Saksi” on Thursday.

(The scheme gives you a mindset that you can purchase an item that you can actually forgo. It actually gets you to be used to borrowing money. But even if it’s zero percent interest or a ‘buy now, pay later’ scheme, that’s still a debt.)

He also said that you can have a credit card as long as you can fully pay your balance at due time.

“Kung yung ‘buy now, pay later’ ay makukuhanan mo pa ng discount, so dalawa ang tinitignan ko diyan, dapat walang interest at kung kaya mo pa i-push, may discount kang makukuha,” said Rapisura.

(In a ‘buy now, pay later’ scheme, there are two things you can consider - one, there should be no interest and if possible, you look for a discount deal.)

How to avoid overspending? Here are some tips on how to avoid spending beyond your resources, especially this Christmas:

• Avoid borrowing money just for the sake of shopping
• Avoid joining the bandwagon in buying the hottest item in the market
• Always set a budget

“Ang credit limit na binibigay, yung credit line natin sa credit cards ay hindi natin pera. Hindi ‘yan extension ng bank account natin. Ang totoong pera mo ay yung pinaghirapan mo na, nandiyan na sa’yo,” Rapisura reminded.

(The credit limit in our credit cards is not our own money nor extension of our bank account. Our real money is the one we are working hard for and already with us.) — Vince Angelo Ferreras/BAP, GMA Integrated News