4 ms·

"I'm fortunate to be in a financial position where damage to my credit score wouldn't be the end of the world.." Then why did you bother using a pay later sche

"I'm fortunate to be in a financial position where damage to my credit score wouldn't be the end of the world.." Then why did you bother using a pay later scheme for a few hundred dollars on some sketch retailer? This is like the person that chose to walk down a dark alley in a large unfamiliar city and can't believe they got mugged.

deleted 5y ago
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faeriechangling 5y ago
The incentive seems pretty obvious to me. You can take the money you save, put it into an ultraconservative investment vehicle, and effectively end up paying less money overall for the same purchase. Most people who finance through these providers do not run into any problems. To put it another way, if you don't take advantage of 0% APR financing, you are effectively paying a surcharge to not have to deal with the additional complexity/risk of investing/financing/dealing with credit agencies. It's not clear to me at all you are getting your money's worth as a result of paying that higher price. Fractional reserve banking is slanted to benefit people who take out debt and companies like Affirm allow somebody who may not be in the market for a Home or a Car to leverage their creditworthiness. Not using your available credit is not much different than keeping your cash under your bed instead of in an investment vehicle. People are just responding to the incentives created by central bankers and do bizarre yet rational things like take out loans for things they can afford out of pocket.
- krallja 5y ago
  > ultraconservative investment vehicle Which pays less than 1% APR. Over six weeks. On a purchase of $271. Congratulations, you saved 31¢.
  - faeriechangling 5y ago
    I probably wouldn’t bother for a $271 purchase but if we’re talking a several thousand dollar computer financed over a year, sure. Worth a few bucks.
    - jokethrowaway 5y ago
      You'll get back 1$ every 1000$. (1000 x 0.01 x 6 / 52). 8$ if you invest in the market long term and get a 8% return. Not worth the headache in any case. This is a tool to allow poor people to get even more in debt.

deleted 5y ago

[deleted]

faeriechangling 5y ago

The incentive seems pretty obvious to me. You can take the money you save, put it into an ultraconservative investment vehicle, and effectively end up paying less money overall for the same purchase. Most people who finance through these providers do not run into any problems. To put it another way, if you don't take advantage of 0% APR financing, you are effectively paying a surcharge to not have to deal with the additional complexity/risk of investing/financing/dealing with credit agencies. It's not clear to me at all you are getting your money's worth as a result of paying that higher price. Fractional reserve banking is slanted to benefit people who take out debt and companies like Affirm allow somebody who may not be in the market for a Home or a Car to leverage their creditworthiness. Not using your available credit is not much different than keeping your cash under your bed instead of in an investment vehicle. People are just responding to the incentives created by central bankers and do bizarre yet rational things like take out loans for things they can afford out of pocket.

krallja 5y ago
> ultraconservative investment vehicle Which pays less than 1% APR. Over six weeks. On a purchase of $271. Congratulations, you saved 31¢.
- faeriechangling 5y ago
  I probably wouldn’t bother for a $271 purchase but if we’re talking a several thousand dollar computer financed over a year, sure. Worth a few bucks.
  - jokethrowaway 5y ago
    You'll get back 1$ every 1000$. (1000 x 0.01 x 6 / 52). 8$ if you invest in the market long term and get a 8% return. Not worth the headache in any case. This is a tool to allow poor people to get even more in debt.