Lay-by vs buy now, pay later: Financial planner weighs the pros and cons

Thabo Shole-Mashao (standing in for 702’s John Perlman) speaks with certified financial planner Paul Roelofse.

Listen below:

Buy now, pay later (BNPL) schemes are becoming more popular because, unlike the lay-by option, you get the goods immediately. 

In some cases, there is also no interest attached - provided payments are made within the stipulated window. 

Failing to meet the payment schedule can result in late fees, interest on the unpaid balance, and it can even negatively impact your credit score.

While BNPL may seem like a good option for many, the high demand for BNPL is an indicator that consumers are struggling, says Roelofse.

“It looks so easy to take something off the shelf, not pay the full amount for it, and split the repayments… but it’s only quite a good deal if you are disciplined.”

– Paul Roelofse, Certified Financial Planner

While the ideal situation would be to save first and then purchase the item, BNPL is not completely irrelevant.

Roelofse recommends having a budget, so you don’t accumulate multiple repayments that you are still obliged to pay back.

“If you can’t measure it, you can’t manage it.” 

– Paul Roelofse, Certified Financial Planner

Scroll up to the audio player to listen to the discussion.