Though most of us don’t really want to dive into the territory of owing money, it’s something that we ought to talk about. Because sometimes it can’t be helped, and there’ll be a period where spending is either unavoidable or unexpected.
Now for myself, I want to talk about a platform that allows you to buy now and pay later, which I have been using recently. It’s been around for a while now, and it’s called Klarna.
Helping You in Gift Season
I’ve found that even with some careful budgeting, I’ve decided carefully to use this platform for some of my shopping, mainly for gifts.
The reason is firstly, I have had a few birthdays in very close proximity that have been unavoidable. I had my own birthday and someone else’s in October, then another two this month in November. And now with Christmas coming up, that’s a lot of gift buying for 3 months!
And yes, I could turn to pre owned gifts, but there are some items that are better bought new, such as under garments and the like, for hygienic reasons. So for this reason, I felt it was necessary to do something different with how I would pay for it.
In this case, I turned to Klarna, and opted for their ‘spread payment over 3 months’ option. So far, this has been an absolute life saver, since it means that instead of paying the full amount for something straight off and not having extra money for food, basic essentials etc., I can spread it out into much more reasonable payments.
So I haven’t done this yet for anything very expensive, I’ve only done this for gifts that I could actually afford full priced. This made sense to me, since a lot of birthdays, along with Christmas, are clustered together closely, while in the other half of the year, I don’t see any birthdays, so I can spread it into the months where they’ll be less expenditure.
Repayments Are Interest-Free
This method of payment is relatively risk-free, so long as you follow the guidelines and repay the required amounts on time. With Klarna, it is genuinely interest free for 3 months, and if you can pay back whatever is owed within that time, then you will not be charged a fee or interest.
This is very important to follow, and which it is why I don’t buy anything beyond what I know I can afford. You never quite know what the circumstances will be surrounding your finances, even if it seems secure, and if you don’t have enough even for the repayments, you could be in a lot of trouble.
But all in all, as long as you stay sensible when using Buy Now Pay Later services, and understand their basic terms and conditions, you should be absolutely fine.
Help You Buy Something You Would Save For Anyway
This could be pretty handy if you’re planning to buy something that may only be available for a limited period, and you haven’t saved for the entire amount yet.
By purchasing something through Klarna or something similar, it means you can get the item instantly, and there’s no need to wait around until you’ve finally saved the money for it.
I know that clothes or decor may not be the necessity you need instantly, but better examples might be textbooks for studies, or a gift for someone at a specific time.
There are many things that could definitely be time limited, and using Klarna to aid that purchase can be a great tool.
You Can Pay It Off Early
What’s great is that if you suddenly find yourself being able to afford an item, you can decide to pay it off at any time without a penalty fee.
This is great news and gives you so much freedom and flexibility with your money, as you’re not tied down to any kind of contract and you can free yourself of it at any point.
You could also choose to stick with paying it over three months, still without paying a penny extra for anything purchase. It really is that simple.
What to Remember
Although I am very much for Klarna, there are other Buy Now, Pay Later schemes too that work in exactly the same way, such as ClearPay/AfterPay, that work with exactly the same interest-free periods.
These companies work with a large range of retailers that already exist, and you can find out if they have a partnership either through the retailer’s website at checkout or the Pay Later scheme’s website.
Always check what the terms and fees are before you opt in, and never assume that all of them are the same. Right now, I am sticking with Klarna and I feel it is the best option for myself, and pretty safe too.
And most importantly, and I cannot stress this enough, only use this scheme for something you can be sure that you can pay off. It’s so important not to get too impulsive and decide that you’re going to put everything on this, however tempting it is. If you over spend, and cannot afford the repayments later, you could find yourself negatively affecting your credit history, which is crucial for your ability to get loans, buy a house or financing a car.
So always think sensibly and use it as a helpful tool, not to enable you to keep spending.