Money Management

Is Buy Now, Pay Later A Bad Deal?

QVCI was talking with an older lady the other day that was going through bankruptcy. She was talking to me about how after the bankruptcy if she needs something she can’t afford, she would buy it from QVC with the easy payments. At the time I thought this was a bad deal, but then I actually looked into it a little.

I looked up a couple of the items on QVC and compared them to the cheapest price on the internet, including S&H. I also only looked at the products that were available with easy pay. It turns out that QVC isn’t that bad of a deal when you factor in that you get the product before you finish paying for it. I looked at a TV for $419 on QVC with $9.95 S&H and the cheapest price I could find on the Internet was $400 with free shipping. So for $30 more you get to get a TV upfront for 4 payments of about $105 a month. I don’t think this is that bad a deal when you consider that.

Would I ever take that deal? Absolutely not, but only because I’d rather save up the money for 4 months, have the satisfaction of paying in cash and get the $30 discount or maybe even wait for a better deal on a different TV. The main problem is you can find cheaper items on sale all over the internet. Probably during that 4 months I would search the internet for other TVs that end up being even cheaper in price and saving a lot more money. But QVC isn’t as bad a deal as I thought it would be. I can understand why she said she does that now. But that’s only if you can control your shopping and only buy things that are a “necessity” in our culture, like a TV.

Would you consider buying something on QVC if the price was in line with other places and you could make a couple of payments on it?

Comments (11)

  • I think it’s a tough call for many struggling to square the “satisfy-me-now” culture that produced so much debt and that we are now recovering from. Delaying satisfaction is not only a great ingredient for building a great credit score, but also for building great relationships!

    For me, delaying satisfaction and saving cash to make my purchases is my preferred way to go; however, I do understand the wisdom of buying something on a credit card and immediately paying it off to build your credit score.

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    • Great comment. I agree, delayed gratification is much more worthwhile.

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  • I think Buy Now Pay Later is a bad deal, but can understand that some people do not have a choice. Back when I was poorer, I would save up for things because I didn’t have credit. The first thing I saved up for was a desk. Then I discovered Fingerhut, which is a way to get things you can’t afford at high prices but with payments you CAN afford – at least if the income you depend on continues. I got a bookcase and TV stand from Fingerhut. And still have them, many years later. What I found interesting is that Fingerhut seemed to disappear, but recently I have received two catalogs from them. They are really perfect for bad economic times, but the changes I’ve made over the years and the mindset I’ve developed don’t allow me to use that kind of thing.

    I want to pay less, not more. I have little faith in the future as far as counting on money to come in. I only know what’s in my pocket, so to speak. I have a severe aversion to paying interest, and pay outright for anything that is possible to do that for. Like a year of car insurance at a time, because I don’t want to pay 12% interest. I don’t have a problem saving money to do that. I drove free or cheap cars until I could buy a new one outright, and now I make car payments to myself and my husband in the form of savings.

    Your QVC example doesn’t sound that bad, but I have an aversion to that kind of shopping too! Because I grudgingly pay for cable TV, and refuse to purchase anything from the TV.

    I do care about money, and strive for financial success. I understand that some people don’t care or think of it as I do. It’s a value system. If I never hoped for better and more freedom, expecting to always be in the same boat, I would probably not mind delayed payments or credit. But it makes no sense to me to get something now, and increase my cost of living in an uncertain future. The future brings its own needs.

    Didn’t mean to write a book! But one more thing ;) – I think making payments on dentistry is the worst thing ever. Committing and spending your future on what is probably something extremely overpriced. Low payments, huge total.

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  • Wow that was a nice read. I haven’t heard of Fingerhut in forever. I used to like looking through the catalog to just see what I could dream about buying.

    I agree with you completely about the interest. I don’t like to buy things that I have to pay interest on.

    I just recently switched paying my car insurance from monthly to every 6 months and it’s a lot easier not having to worry about it every month.

    Thanks for the great input.

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  • It may seem like a good idea, and it may be a decent price at the moment. But, here’s something to remember … anything that requires payments means your spending outside of your means.

    It alters your budget for the next few months, years or lifetime. Which makes it just another debt/bill.

    You just have to constantly ask yourself. Is this a want or a need? And, is it really worth digging yourself deeper in debt?

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    • exactly. Some people don’t realize the difference between a want and a need. If your able to make payments on something, it’s probably a want.

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  • Quite an interesting post! Though I’ve never purchased anything from QVC, it is nice to know that they are not a rip-off.
    .-= moneycone┬┤s last blog ..How you can profit from this market crash =-.

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    • Yea it surprised me.

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  • Buy now pay later is why most Americans are broke. They need to try a new approach.

    Save now, buy later (with cash).

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    • That should be everyone’s motto.

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  • Calculate the interest… it’s not a good deal.

    $30 over three months would be $120 annualized on $400 which according to my calculations is over 25% interest.

    Add that to the payment method which is usually a credit card and it gets very frightening.

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