Look for this number tied to your smartphone (12 28 23)

Author

Anthony Hazzard
December 28, 2023

Americans are hooked on “buy now, pay later” this holiday season. Find out how many of us are turning to BNPL, and what Clark thinks about it, later in this email.

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💵 Clark: Just Say “No” To ‘Buy Now, Pay Later’

“Buy now, pay later” (BNPL) is a catchy marketing concept. It’s especially tempting during the holiday season.

You could pay $500 for this new flat-screen TV. Or you could pay $125 today – and three more times in the coming months. Pay it all on time and you’re getting an interest-free loan.

The BNPL market exploded in the U.S. in the early 2020s.

“Because of human behavior and psychology, this is going to continue to grow like wildfire,” Clark said at the time.

“And people are going to use this by the many hundreds of billions of dollars. But it doesn’t mean they should be doing it and that it’s a good idea. Because it’s not.”

A surge in savings rates during the onset of COVID-19 led to an eventual shrinking of the BNPL market as Americans temporarily acted more conservatively with their discretionary income.

That’s out the window right now. An estimated 1 in 5 Americans were expected to use BNPL to buy holiday gifts.

Walmart just started offering BNPL at self-checkout kiosks. Americans spent nearly $1 billion via BNPL on Cyber Monday alone this year, a major record.

With credit card debt topping $1 trillion, loan payments demanding much higher interest across the board and years of inflation exceeding the Fed’s typical 2% target, the ratio of cash on hand to expenses isn’t great for many of us.

Before you become part of the statistics, learn more about why Clark doesn’t like buy now, pay later.

📊 Stat of the Day

🏠️ 58: The median age for repeat home buyers in 2023. That’s up from 36 years old in 1981. There’s a growing gap between first-time buyers (35) and repeat buyers (58). Older buyers may be able to sell their existing homes to afford new purchases while avoiding higher mortgage interest rates.

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☎️ Need Money Help?

The Team Clark Consumer Action Center is a free helpline that can help you navigate your money questions. Call 636-492-5275. Visit clark.com/cac for more information.

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