WACO, Texas (KXXV) — Buy now, pay later is an option shoppers have to help pay for Christmas gifts. Our 25 News reporter, Chantale Belefanti, talked to a local neighbor about holiday shopping.
- 50% of people who use buy now pay later options use it for luxury items, while 47% use it to purchase groceries.
- Buy now, pay later can be used in a healthy way, according to one expert.
Watch the full story here:
BROADCAST TRANSCRIPT:
“We knew exactly what we wanted; we have older children, so it just made it easier," said one holiday shopper, Marisa Proctor.
Proctor said she’s already checked off the majority of her Christmas list. She and her husband started shopping in October and spread their purchases out to keep within budget.
“We purchased a lot of toys with tots. We knew the budget going in, so when sales came up and stretched it out over several paychecks, it just made it more budget-friendly," Proctor said.
According to a Forbes study, the National Retail Federation projects holiday spending to range between 3.7% to 4.2% and higher prices could drive consumers to use a buy now, pay later method.
One financial expert said there’s nothing wrong with using it in a healthy way.
“At the register, you’ll have the opportunity to take out new credit and get a discount if you take on the new credit. That’s not a negative to take on that discount," said Bill Dendy, a certified financial expert and CPA.
But what Dendy said next could hurt you.
“But what is a negative is getting yourself in a position where you don’t have the ability to make the monthly payments or that you stretch yourself thinner than you expect," said Dendy.
A Lending Tree survey finds 41% of people who use buy now pay later made late payments. For Proctor, she has her own method.
“We do use credit cards, but we pay them off monthly just because the credit cards are a lot that we have all have the benefits or the cash back options," said Proctor.
