Is Buy Now Pay Later a Smart Move or a Financial Trap?

Speaker A00:00:37

Hey, it sounds harmless. Just split it into four payments. No interest, no big commitment.But what if that small decision today creates pressure you feel for months, hey, maybe even years. If you're wondering whether buy now, pay later is helping you or quietly hurting you, today we're going to bring clarity to that decision.Very practical show today. Hey, friend. Ralph Estep Jr. Here.This is financially Confident Christian, where every day my goal is to help you break that cycle of financial shame and. And live with confidence. Now, this is a voicemail we got today that just nailed it. And today's topic is buy now, pay later.A smart move or is it a trap? Well, let's get right to our voicemail question for today.

Speaker B00:01:48

Ralph, I need to be straight with you. I'm seriously considering buy now, pay later. Not because I want to, but because I'm running out of options. Things are tight, really tight.And I keep thinking maybe this could just get me through right now, give me some breathing room. But here's what's eating at me. I'm scared. Scared that I'm about to make a decision that's going to haunt me for months, maybe longer.I don't want to dig myself deeper just to feel okay for a week. I don't want to look back and realize I chose quick relief over actual wisdom. The thing is, I don't even know what else to do.That's what's really getting to me. I want to make the right call. I want to be disciplined about this. I want to trust God with it. But right now, it just feels heavy, overwhelming.So I'm asking you straight up. Is this something that could actually help me, or am I just walking into a trap? And if buy now, pay later isn't the answer, what is?Because I really need something that gets me through this without making it worse.

Speaker A00:03:02

Wow. There's a lot of honesty in that question, and I appreciate the honesty. Thank you so much for sending that in.If you want to send over a voicemail message, it's super simple to do that. Just go to financiallyconfidentchristian.com voicemail. You just hit record and send it to you. But I like the word that you use there.You used the word desperate. And when I heard that word, it made me say, you know what? We really need to dig in there a little bit because it's important.And when we feel desperate and listen, trust me, I've been there. I've been in that feeling of desperation.But when we feel desperate, the truth is we're more vulnerable and we're more vulnerable to making short term solutions fit.But right now we gotta slow this down a little bit because the other word that you used, and I loved it, you said, I want to bring some wisdom into it. So here's my big idea for today. If a solution solves today's pressure, but creates tomorrow's burden, that's not true relief.So let's talk about how do we understand if this is a good choice? Is this true relief?The first thing you've got to understand, and this is like that 30,000 foot view, you've got to understand what you're really solving. It might seem like buying buy now, pay later is going to solve a problem.But you've got to ask yourself the bigger question, what problem am I actually trying to solve? Because if you don't know the answer to this question, it's very difficult to figure out is this the right decision to make?Because oftentimes the problem you're trying to solve is maybe lack of cash right now. And I hear that in your question, you're using the word desperate. I don't know what else to do.You're also adding urgency into this and there's a ton of pressure. And man, I can feel the emotional stress in this.Because the thing you've got to understand is buy now, pay later doesn't remove the cost, it just delays it. And it doesn't delay it in a good way.I don't know how many, I've done other shows about this, how many people have bought into the buy now, pay later thing. And they said, oh, you know, you're going to have one year with no interest, but make sure you get that paid.And then all of a sudden if you can't pay it, then they whale you with that interest that it's been accruing from the beginning. So yes, you're delaying the pressure, but it's still pressure.So if you got to start off by understanding what is it you're trying to do right now, once you figure that out, then count the future commitments because this is where people get caught. One purchase feels manageable. Oh, I'm gonna do this one. Buy here, buy now, pay later and then another one and then another one.And suddenly, and trust me, I've fallen into this same trap.I remember when I was young, I was first getting started my career, they used to send these checks out, just take this quick loan or go get this, hey, same as cash thing.My credit was great, but all of a sudden I had multiple payments, I had different due dates I had overlapping obligations because what seemed like a little decision was a big decision. And then I started to notice my future income was already spoken for. I already had 10 of these things. And see, that's where the trap begins.But let's get real practical because one of the things I think you can do to solve this problem is ask yourself what I call the cash question. This has got to be your filter. Ask yourself this. If I had the cash today, just think about this.If I had the cash right at this moment, would I still buy this? That's what you got to ask yourself. If the answer is no, guess what? Ding, ding, ding, ding. That's your signal.Because financing something you wouldn't buy outright most of the time leads to regret. If I said to you, hey, here's the cash, you don't have to pay me back, would you make that decision? If you say no, I don't really need this, Ralph.But it was like, oh, it's same as cash, I'll do it. The bell should go off in your head now. Maybe it, maybe you've got that decision. You're like, Ralph, yeah, I would make this decision.The next step is to really explore some better short term options. Instead of adding another payment, maybe you can create some space. This could be things like delaying that purchase. Maybe, yeah, we need this.But let me put it off a little bit. Maybe there's a lower cost option. This is the thing that I get so frustrated with, the buy now, pay later things.People don't look at the cost, they just say, oh, I can do this. I remember at one point I was really desperate to get a laptop computer.I could care less how much the cost was as long as they would approve it and I could pay monthly. But there were better options out there. Maybe you need to adjust your current budget. Maybe things are too tight.Maybe ask for a payment plan directly from the service instead of using this third party financing. Here's the thing a lot of people don't know. I work with business clients that sell these.That third party company takes a huge percentage of the profit.Sometimes if you reach out to the vendor directly, they will offer you a better option because those options aren't going to create new pressure, they're just going to reduce it. But in the end, here's what you've got to do. You've got to choose peace over urgency. I want to bring this back to the heart.One of the things that I felt in your question is urgency. Fix it now. Relieve this feeling. Those are urgencies that's emotion talking. But I love what you said. You said wisdom.And see, when I think about wisdom, I think of pause. Let's slow this down a little bit. When I think of wisdom, I think, think and choose what leads to peace.Friend, you don't need instant relief if it creates long term stress. You need to make a decision that you won't regret later. Because not every quick solution leads to lasting peace. So here's your win for today.Here's my answer to your question. Before your next purchase, ask yourself this one question. Would I still buy this if I had to pay for it today?That is really the answer to the question, would you still buy this if you had to pay for it today? And then let that answer guide you in your decision making. Well, let's get to the word of God. We're going to go to Proverbs, chapter 22, verse 7.It says the rich rule over the poor and the borrower is slave to the lender. When you buy these, buy now, pay here, that's a loan and you're becoming a slave to that lender. Now maybe this is the best decision.You've said, hey, this works for me. But even small forms of borrowing can quietly create pressure and dependency. But God calls us to walk in freedom, not financial bondage.So if this is creating bondage for you, the answer needs to be no. How about we pray together? Heavenly Father, right now I lift up my friend who feels pressure and is trying to make the best decision for them.And Lord, you see their situation, you see their need, you see the tension that they're carrying. And I ask right now, Lord, that you would give them clarity to see beyond this moment that seems like they got to make this decision. Lord.Give them wisdom to choose what's going to lead to peace, Lord, and give them strength to pause when urgency tries to take over. Help us all to trust you as our provider, Lord, to make better decisions and really to protect our future.We just ask that you would bring peace into all of our hearts and direction into all of our steps. And we ask this in the name of Jesus. Amen. Friend, hear me on this. A wise pause today can prevent pressure tomorrow.You don't even realize the pressure that you might be putting on yourself. I've been there, lived it. It's a tough situation. Now, maybe you're walking through something just like this right now.Maybe it's not buy now, pay later. Maybe it's something that just got you all tied up in knots. I would love to hear your voice. I'D love to help you walk through that.That's what my heart's all about. This show is all about helping you to break that financial shame that you're in.But if you want to send me a voicemail, it's super simple to do it, go to financiallyconfidentchristian.com/voicemail we'll put a link in the show notes. All you gotta do is click on that click record and hey, I'll hear your beautiful voice.But again, that's financiallyconfidentchristian.com/voicemail thank you so much for the question today. Thank you for joining me today. As I always say, stay financially savvy. May God bless you and you have a truly blessed day today.