The holiday shopping season is here, and there's one payment method that's skyrocketing in popularity: buy now, pay later (BNPL). This Cyber Monday alone saw consumers finance over $1 billion through BNPL services, setting a new record. By season's end, that number is expected to hit $20.2 billion—an 11% jump from last year.
If you've been tempted by those "pay in 4 easy installments" offers at checkout, you're not alone. But before you split that purchase, here's what you need to know about using BNPL responsibly.
What Is Buy Now, Pay Later?
BNPL does exactly what it sounds like. Services like Afterpay, Affirm, and Klarna let you buy items immediately and spread payments over time. The appeal is obvious: many loans are interest-free for certain periods, require no long-term commitment, and are accessible even if you have limited credit history.
For shoppers facing large or unexpected expenses, BNPL can make purchases feel more manageable. But convenience doesn't mean consequence-free.
The Hidden Risks
Here's the reality check: 41% of BNPL users made at least one late payment last year, according to a 2025 Lending Tree survey. Miss a payment, and your loan could go to collections. From there, it gets reported to credit bureaus, potentially damaging your credit score.
Financial experts warn that just because you're approved for a BNPL loan doesn't mean the lender thinks you can afford it. As Lisa Gill from Consumer Reports puts it, approval isn't an assessment of your creditworthiness—it's simply a company willing to take you at your word.
Smart BNPL Strategies
Only Borrow What You Can Actually Repay
The golden rule of any borrowing applies here: don't take out a loan unless you're certain you can pay it back. If you're already carrying credit card debt or don't have funds to cover the payments, BNPL will only dig you deeper into financial trouble.
Former New York Federal Reserve analyst Felix Aidala notes that BNPL users tend to be more financially vulnerable overall. Using these services to buy something you otherwise can't afford is a recipe for stress.
Stick to One Loan at a Time
It's dangerously easy to take out multiple BNPL loans and lose track of your payment schedule. Unlike a single credit card statement that shows your total balance, BNPL loans are scattered across different accounts with different due dates and billing cycles.
Lauren Saunders from the National Consumer Law Center warns that these debts accumulate invisibly. Even loans from the same provider can have different repayment periods, and those lasting longer than six weeks often charge interest.
With multiple autopay arrangements pulling from your checking account on different dates, you risk overdrawing your account and triggering bank fees. One protective strategy: use only one BNPL provider so all your payment plans live in one place.
Watch Out for Impulse Shopping
Picture this: You're at checkout, hovering over the "buy" button for a $200 item you're not sure you need. Then you see it—pay just $50 today! Suddenly that purchase feels much more reasonable.
This is BNPL's psychological trick. Breaking down the total cost into smaller chunks makes spending feel less significant, even though you're ultimately paying the same amount (or more, with interest).
Younger shoppers are particularly susceptible. More than one in four Gen Z BNPL users regret how much they've spent using these services. Journalist Bob Sullivan suggests a helpful exercise: imagine your future self opening all those payment reminders. Would you still make this purchase?
Consider Purchase Protection
If you buy a $400 purse with BNPL and it arrives damaged or never shows up, you're in a tougher spot than if you'd used a credit card. Credit cards offer chargeback rights, allowing you to dispute charges for items that don't arrive or arrive defective.
BNPL lenders aren't regulated as strictly as credit card companies. While some companies offer returns or dispute policies, consumers report still being stuck with payments even when orders go wrong. If purchase protection matters for your transaction, a credit card might be the safer choice.
Buy now, pay later isn't inherently good or bad—it's a tool. Used thoughtfully by someone who can afford their payments, it offers flexibility and convenience. Used impulsively or to afford things beyond your budget, it becomes another source of debt and financial stress.
Before clicking that "split payment" button, ask yourself: Can I afford this purchase outright? Am I buying something I genuinely need or want, or am I just making it easier to overspend? Do I already have other BNPL loans I'm paying off?
If you answer honestly and still decide BNPL makes sense for your situation, go ahead. Just remember that "later" always comes eventually—and when it does, you'll need to pay up.