In this file:

 

·         Eat Now, Pay Later: Going Into Debt for Food

Americans are increasingly turning to pay-later services for groceries and other everyday essentials. And there are signs that the practice is putting some in deep debt.

 

·         Understanding the risks of buy now, pay later apps

… Spending money you don’t have has become easier than ever before…

 

 

Eat Now, Pay Later: Going Into Debt for Food

Americans are increasingly turning to pay-later services for groceries and other everyday essentials. And there are signs that the practice is putting some in deep debt.

 

By Priya Krishna, The New York Times

Sept. 7, 2022

 

Josh Roberts didn’t think twice about taking out a loan to pay for groceries. It was early in the pandemic, and he was making $16.50 an hour working for a technology company in Cincinnati while supporting his sister and her girlfriend.

 

“We were just not making enough to live,” he said.

 

So he started buying groceries online using a virtual credit card from Klarna, a “buy now, pay later” service that allowed him to break payments into smaller installments that could be made over several weeks, with no interest.

 

Soon Mr. Roberts, 30, was regularly spending beyond his means on food — chicken breasts, bananas, chips, cereal. He fell behind on payments, and ended up owing more than $1,000 to Klarna, an estimated $100 of it in late fees. He already had about $11,000 in student debt, and another $2,000 in unpaid medical bills.

 

“I don’t want to be in debt for a carrot,” he said. “But you have got to do what you’ve got to do.”

 

When pay-later services like Klarna, which was founded in Sweden, arrived in the United States about a decade ago, they were largely used for one-time, discretionary purchases like concert tickets and high-end clothing. But as inflation mounts, Americans are increasingly turning to them to finance something much more mundane and essential: what they eat...

 

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https://www.nytimes.com/2022/08/29/dining/buy-now-pay-later-loans-groceries.html

 

 

Understanding the risks of buy now, pay later apps

 

Jack Pedigo, CNBC 

Sep 13 2022

 

Spending money you don’t have has become easier than ever before.

 

Buy now, pay later (BNPL) services have been on the rise for years, with companies such as Klarna, Zip, and Afterpay offering zero-interest payment plans for a variety of purchases from partner retailers — everything from mattresses to electronics, sporting goods, clothing, jewelry and more. Their apps are marketplaces full of major retail brands that beckon you with deals and offers, and the clincher: You don’t have to pay for the whole purchase now.

 

Apple already offers zero-interest payment plans on its products through Apple Card, but the company is adding a new BNPL option called Apple Pay Later that will be connected to Apple Wallet. Now, with an iPhone’s wireless tap, users can purchase non-Apple products spread out in four payments over the course of six weeks.

 

Tempting, right? That’s the point.

 

A whopping 43 percent of Americans said they have used a BNPL service, according to an April 2022 LendingTree poll, up from 31 percent in 2021. These services are also most popular among women, Gen Z (ages 18 to 25), and those making between $50,000 and $74,999 a year.

 

College students and recent graduates, who make up Gen Z, tend to have little to no credit history and are generally less financially literate. If mismanaged or overused, BNPL services can lead to drastic consequences on a young consumer’s already delicate financial wellness.

 

“As it becomes easier for consumers to access buy now, pay later loans, it becomes more important for the consumer to be their own filter and to go through all the right steps that they need to take to ensure that they are borrowing for the right reasons,” said Bruce McClary, senior vice president of membership and communications at the National Foundation for Credit Counseling.

 

Without understanding the hidden risks of BNPL loans, these services can cause consumers more harm than good. Here’s what you need to know before considering using BNPL apps.

 

When to use a BNPL app ...

 

If you miss a BNPL payment, what will happen? ...  

 

Does spending with BNPL feel too easy? ...

 

Do you know the changing rules and regulations? ... 

 

more

https://www.cnbc.com/2022/09/13/understanding-the-risks-of-buy-now-pay-later-apps.html