This topic poses a question that almost always comes to everyone’s mind at one point in their lives, Is It a Trap or a Treasure? Amid all these, most of have found ourselves browsing through Lazada or Zalora, and then suddenly! There is a conspicuous button labelled ‘Buy Now, Pay Later’, which is often translated into a free purchase. However, let’s not go hog wild when it comes to installing those simple targets we have for BNPL and determine if it is good or bad for our pockets, my man.
The main question here is What’s the Deal with BNPL?
BNPL is relatively a new trend in contributing to the financial sector of Malaysia. From Atome, hoolah, Grab PayLater, and Split, you can simply make today’s purchase today and pay for it in multiple instalments. It seems easy and wonderful as if it is a package deal, does not it? No interest, no credit card required it’s just shopping and nothing else.
However, just as there are incredibly safe and effective SEO tools, there is always a drawback to everything that sounds very good to be true. If not well managed BNPL can see you sinking into the pool of debt.
2. Budget Before You BNPL
Well, well, let’s not split payments only because you can. To avoid running into problems the best approach is to always budget in advance of using BNPL. Basically, he advises people not to use BNPL if they would not be able to afford to purchase an item directly at the time of its purchase. Nevertheless, you will be required to pay that amount one day.
Pro Tip: Follow the rule of 24 hours before reaching the final decision to buy something because they normally don’t need it. However if both of you still have your eyes set on each other after 24 hours, then there is nothing wrong with going ahead and getting married.
3. Don’t BNPL Everything
There is a difference between one purchase and another and not each of them must be split into installments. While purchasing things such as electronics, furniture among others, BNPL may be a suitable option, but when purchasing other requirements such as clothes, food, among others, it is cheaper to pay cash. The last thing that any person would wish is to be in a position whereby they will purchase nasi goreng in the previous month and be paying for it in the following month.
Pro Tip: Choose BNPL only for essential purchases or things that would benefit you, for instance, a new laptop for your job or classes. Do not use it if you are in a habit of spending that money for some impulse buying or for any routinary expense.
4. Track Your BNPL Expenses
Lack of transparency and BNPL can create a situation when people don’t even realize how much they spent. Since there are multiple payments coming out at various times it is important for one to have adhere to the financial calendar. Some popular expense tracking apps include; Spendee and Money Lover that you can use to monitor your BNPL repayments together with other expenditure.
Pro Tip: Use the phone reminder option to alert you when the next BNPL payment is due so that you do not miss out on any payment. Believe us, you really do not need to ponder how much it will cost to cover those additional days.
5. Have an Exit Strategy
If you’re beginning to feel sucked into your BNPL payment obligations, then you need to step on the breaks. It is advisable to pay off your remaining installments as and when you are able to if not in instalments then all at once. This might itch a little now, but it’s wiser than to continue trapped in a cycle of debt.
Pro Tip: For those with many different BNPL providers, one should start with the ones that charge the most in late fees or offer shorter repayment tenures.
6. Find Out When to Say No
That means, if BNPL is used appropriately, it quite handy, nevertheless, -it is not a free money. If you are using BNPL for as a normal mode of payment for your purchases, then you should start realizing something is wrong financially. Perhaps the phrase ‘no’ should be said sometimes and money should be saved for those special instances contrary to situational splitting of the payment bill.
Pro Tip: Make a personal constraint—do not use BNPL for anything less than an amount, let’s say, RM500. If anything is less than that go pay cash or don’t bother to negotiate.
BNPL solutions are great if one is careful, which in a nutshell, the most important thing, since BNPL is also likely to lead to more problems if one is not careful. The idea is to apply them as less as possible and never leave your budgets out of your considerations. Hey bro, just think of how amazing it will be when one day the future you will be grateful that you made good decisions financially!
