AfterPay – The Bad, The Bad and The Ugly

Welcome to a small series of Blogs on AfterPay – The Bad, The Bad and The Ugly.

AfterPay in my view has zero benefit to your financial situation.

Yes in the short term it can feel like a good idea for a whole range of reasons (Which I will cover below) but the negative impact on your finances and your money mindset far outweighs any small “positives” that this payment system can bring.

AfterPay is a brilliant tool to encourage you to spend more than you normally would. Its extremely well marketed, extremely easy to use and you can use it both online and in a physical store.

The brilliance of AfterPay in my view is actually highly unethical. It targets people who are already financially vulnerable and should be discouraged to be spending additional money rather than encouraged to.

AfterPay and Money Mindset

AfterPay plays on your money mindset and helps you to feel better, good or positive about your spending choices.

Because you are paying smaller amounts, you feel like the purchase is cheaper. This is of course not the case. If you buy something for $300 or you make 6 x payments of $50 you have still spent the same amount of money.

You feel less guilty for purchasing something expensive – please remember this feeling is not accurate because you are still purchasing the expensive item.

Because its not a Credit Card you feel like you are not getting into debt. Again, this is not true. If you buy something now and pay for it later – that is debt!

You give into instant gratification. We have all heard the saying “Good things take time” yet we are constantly wanting everything now. We are loosing the ability and patience to wait and work towards our purchases. AfterPay gives you an avenue to make instant gratification even easier.

At YouChange we work on understanding what is truly important to you and what your financial goals are. We help you to determine what spending will help you achieve your goals and you will learn that longer term financial success and security feels a lot better than small amounts of instant gratification on a regular basis.

“AfterPay helps me manage my finances better”

If this is what you are thinking and feeling at the moment, you need to make some changes immediately. If you are relying on AfterPay to help you manage your finances then you are on track to going backwards. You need to make some changes immediately so that you can manage your finances without using AfterPay or Credit Cards. This is a dangerous path to be on and its time to get off.

“AfterPay helps me to buy things I cannot afford”

If you cannot afford to purchase something and pay the full price upfront, then you also cannot afford to pay this off over several weeks.
You are still paying the same amount.

If you can put small amounts of money aside to pay for something you have already purchased, how about instead you put money aside each week and pay for it in full when you have the money available?

If you cannot pay for it in full – you need to ask yourself “Is this purchase a necessity in my life?” If you do not need that purchase for pure survival then you need to put it back on the shelf and come back to it when you can afford to buy it.

If you have been using AfterPay – you are not alone.

A large percentage of my clients were regular users of AfterPay when they started with YouChange. The good news – they no longer use AfterPay. They need is not there, the understanding of how it negatively impacts their finances and the fact that they now have a more structured approach means they simply do not need it anymore.

Please do not think it is a harmless way of purchasing things. The reason AfterPay is so successful is because it appears harmless but it is actually causing great damage to the way you view your finances, and your long term financial success.

YouChange can help you get out of that cycle if you are an AfterPay user. Contact us to book a consultation.

Keep an eye out on our next blog. This is when we will discuss how AfterPay can impact your borrowing and the high fees that are associated with it.

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