Dear Vanessa,
I’m a 24-year-old who has found myself in a difficult situation with buy-now-pay-later schemes. Initially, I used these services for clothes, but now I rely on them for groceries and other essential items as payday feels far away.
I have accounts with three different providers. Although each repayment seems manageable individually, they quickly accumulate, leaving me short on cash. I’ve even started using one account to cover the payments of another.
I’m unsure of my total debt, and I feel embarrassed about my inability to manage my finances effectively.
I want to enjoy some small treats, but I fear the situation may worsen. What should be my first step?
Worried Shopper
Dear Worried Shopper,
You are not incapable when it comes to managing your money; recognizing the problem and seeking assistance is a vital first step.
When your repayments start overlapping, it’s time to take a break from further spending using these services. It doesn’t imply that you need to resolve everything at once; the goal is to gain clarity on your expenditure.
Begin by logging into each account to document your current balances, upcoming repayments, and their due dates. Align these dates with your paydays and mandatory expenses like rent, food, transport, and utility bills. While this may feel daunting, having a comprehensive view will aid you in planning your finances.
For the time being, avoid new buy-now-pay-later purchases and refrain from utilizing one account to pay off another. If you find yourself unable to meet a repayment, reach out to the provider ahead of the due date and explain your circumstances.
Inquire about available support or flexible repayment arrangements. Remember to prioritize essential expenses over repayments if they compete against your basic needs.
You don’t have to eliminate every indulgence permanently. Allocate a small amount of guilt-free spending every month after ensuring your essential expenses and repayments are considered. Once that budget is exhausted, hold off until your next paycheck before purchasing again.
It’s far less stressful to enjoy a treat that you can afford today than one that haunts you in the coming weeks.
Given that you have multiple accounts and are uncertain of your total debt, it would be prudent to consult a free financial adviser. Call the National Debt Helpline at 1800 007 007 to discuss your situation without judgment and explore your options.
There’s no need to fix every aspect of your finances immediately. Start by listing everything, halt new repayments, and don’t hesitate to seek help when facing challenges. Tackle one step at a time.
Vanessa
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