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With only a hop, skip and a jump until Christmas, the pressure is on to get on top of your to-do-list. Whether it’s gifts, food, decorations or lights, when it comes time to make your purchases, how will you be paying for them?

With the rise of pay later services, options like AfterPay, Openpay, zipMoney and Ezypay are available at more retail outlets than ever before. They are so popular in fact, that it is estimated around 100,000 Australians will use them to help manage their Christmas budget. So, should you or shouldn’t you?

Sticking to a budget at Christmas time is TOUGH, especially if it’s tight. Whatever your situation, it is important to look at the bigger picture. Do you want to start 2018 feeling financially stressed out?

Before you decide to pay for your purchases with no upfront payment, consider the following:

 

Fees: Read between the lines

Before you make a pay later purchase, make sure you are aware of ALL of the fees. These are not always easy to spot and can be hidden in the fine print. Here are a few to get you started:

  • Afterpay: A $10.00 late payment fee applies and an additional $7.00 if not received within seven days of the due payment.
  • zipPay: A $5.00 monthly service fee applies and a minimum payment of $40.00.
  • Openpay: Default fee of up to $9.00 each time an installment is missed.

 

Can you afford it?

Whether you break down the cost into smaller payments or not, at the end of the day you need to ask yourself whether you can really afford this. And can you pay it back in time without incurring any fees? Services like Afterpay can make the cost sound much cheaper than what it actually is. Phrases like, “just four easy payments of $50.00”, are often used. Don’t be fooled, make sure you add up the figures and understand the full amount due.

 

How much have I spent altogether?

Swiping a payment here and there over the course of a month adds up and it’s easy to forget to keep track. Whether you’re using your credit card or a pay later service, make sure you know how much you have spent, what your repayments will be and when they will start.