The Cost of Paying Later
Counting the Cost in the Buy Now, Pay Later Era
Counting the Cost in the Buy Now, Pay Later Era
This week's blogpost - https://bahnsen.co/4AXYRyJ
Trevor Cummings hosts the Thought Someday podcast with Brett Bonecutter and Blaine Carver to discuss his blog post, “The Cost of Paying Later,” focusing on the cultural shift toward “buy now, pay later” financing from firms like Affirm and Klarna for everything from small purchases to luxury items. They argue people fixate on monthly payments rather than total cost, making commitments easier and leading to “death by a thousand cuts” as multiple payments and subscriptions accumulate, especially with frictionless tools like Apple Pay. They note interest rates can range from 0% to 30% and question disclosure, delinquency, and why consumers choose these services over credit cards. Trevor emphasizes the importance of counting the full cost and trade-offs, balancing cash flow versus balance sheet, and recognizing how financing and easy credit can distort behavior and reduce flexibility over time.
00:00 Welcome and Setup
00:17 Buy Now Pay Later Boom
02:56 Monthly Payment Mindset
06:07 Keeping Up and Comfort Creep
09:02 Rates and Disclosure Questions
10:36 Layaway Versus Instant Credit
12:19 Is It Dangerous Socially
16:50 Why Not Use Credit Cards
19:38 Frictionless Spending Traps
20:53 Textbook Math Versus Behavior
24:49 Should Versus Could Afford
30:15 Balance Sheet Versus Cash Flow
37:32 Opportunity Cost and Compounding
39:58 Practical Takeaways and Wrap
41:44 Final Thoughts and Sign Off
Links mentioned in this episode:
Trevor is a Partner, Director of our Private Wealth Advisor Group, and Author of Thoughts on Money.
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