The Shocking Truth About Buy Now, Pay Later

👋 Hey guys - Noah here,

Last week, my mate James couldn't get approved for a flat rental.

Not because he doesn't earn enough. He makes £35K a year.

It was actually because three Klarna purchases from last Christmas destroyed his credit score.

Today I'm exposing the truth about Buy Now, Pay Later that Klarna, Clearpay, and the rest desperately don't want you to know.

The £7 Billion Secret

Klarna alone made £1.8 billion last year.

Not from interest (they advertise 0% remember?).

From late fees, missed payment charges and selling your data.

The worst bit is, they're engineered to make you fail.

How They're Rigged Against You

I dug into Klarna's actual numbers:

22% of users have missed at least one payment.

Think about that. Nearly 22% of people using "easy" payment plans are getting hit with fees.

Here's the trick they use:

• Payment 1: Due in 0 days (you remember this one)

• Payment 2: Due in 30 days (starting to forget...)

• Payment 3: Due in 60 days (completely forgotten)

They're banking on you forgetting. And when you do? £12 late fee. Plus your credit score drops 50-100 points.

The Real Cost Nobody Calculates

Let's say you buy a £120 pair of trainers on Klarna:

What you think happens:

• 3 payments of £40

• Total cost: £120

What actually happens (for 41% of people):

• Payment 1: £40 (on time)

• Payment 2: £40 + £12 late fee

• Payment 3: £40 + £12 late fee

• Total cost: £144

That's a 20% markup. On an "interest-free" loan.

The Credit Score Massacre

Most BNPL applications use a hard credit check. Three Klarna purchases in one day? That could be three hard searches on your credit file.

Each search drops your score by 5-10 points.

If you miss a payment, your score drops another 50-100 points.

Suddenly you can't get:

• A decent phone contract

• Car finance

• A mortgage

• Even a flat rental

All for some trainers you couldn't actually afford.

BNPL makes you spend 40% more than you normally would.

Why? Because £40 feels affordable. £120 doesn't.

It's the same trick casinos use. Chips don't feel like real money. Neither do BNPL payments.

The Alternatives That Actually Work

Instead of BNPL, here's what I do:

1. The 48-Hour Rule: Screenshot what you want. Wait 48 hours. If you still want it, save up for it.

2. The Envelope Method: Put £50 a month in an envelope marked "treats". When it's gone, it's gone.

3. The 10% Test: Can you afford to lose 10% of the purchase price? If losing £12 on a £120 purchase would hurt, you can't afford the item.

4. Sell Before You Buy: Want new trainers? Sell your old ones first. Use that money.

Speaking of taking control of your money - I've been using Snoop to track exactly where my cash goes. It sends me alerts before payments come out (so I never miss them) and shows me when I'm overspending.

Last month it stopped me from a £35 overdraft fee by warning me I was about to go over. That's basically three Klarna late fees saved right there.

Get Snoop free here - it's literally like having a financial advisor in your pocket.

Let me know - have you been caught out by BNPL before?

All the best, Noah