The Truth About Buy Now Pay Later

Buy Now, Pay Later is being pushed harder than ever this season: but here’s what people aren’t being told. 

Every holiday season, the pressure ramps up: be generous, show up, spend big, make it magical. And every holiday season, millions of people quietly slide deeper into financial stress (and debt) trying to pull it off.

I had the privilege of speaking with a local radio station about Buy Now, Pay Later, but I honestly couldn’t wait to share why you should avoid this debt vehicle during the holidays.

Let's get into it.

The Consumer Financial Protection Bureau released new data showing a pattern that, as someone who has looked at hundreds of budgets, I am not surprised to see:

🔹 People max out their credit cards
🔹 Then turn to BNPL because it looks “free”
🔹 They start stacking loans across multiple apps
🔹 Cash flow tightens
🔹 Autopay hits → overdraft fees
🔹 Missed payments → collections
🔹 Collections → credit damage

And now I want to add the next layer, of what this really looks like behind the scenes:

People use all their income to pay for past decisions. They pull money out of 401(k)s, take out large personal loans, or (even worse) turn to debt consolidation companies for a “one payment” solution. But those consolidation companies don’t cover Buy Now, Pay Later unless the debt has already gone to collections. And they don’t cover student loans or other types of debt either.

What’s also incredibly disturbing about BNPL is how aggressively it targets young people and consumers with low credit scores under the illusion that it’s “free payments.”

➡️ 65% of all BNPL loans go to subprime or no-score borrowers — consumers who are already financially vulnerable.

BNPL companies also make money on the back end:

✔ $7–$15 late fees (per installment)
✔ “Snooze,” “reactivation,” and other penalty fees
✔ Autopay pulling from debit cards and triggering overdraft charges
✔ Collections activity on unpaid balances

One major BNPL provider earns 13.6% of its revenue from late/snooze fees alone. 

Here’s what that means in real life:

A $150 holiday purchase can turn into a $300–$500 collections bill. But most people aren’t stopping at one purchase — they’re stacking loan after loan, until every day they’re getting a notification that more money is leaving their checking account. 

So my message this year, for you and the people you love, is simple:

🛑 Don’t use debt to survive the holidays
🛑 Don’t use Buy Now, Pay Later

If the holidays have become a cycle of debt for you and your family, then I’m asking you to reevaluate what this season is supposed to mean because the current process is not working.

If you can’t afford it, don’t buy it.

You will feel so much better saying “I’m not doing gifts this year” than spending the next 12 months paying for one day of pressure, guilt, and emotional overwhelm.