As the holiday shopping season approaches, many consumers are drawn to "buy now, pay later" (BNPL) options, which allow them to purchase items and pay for them in installments. While this payment method can provide immediate access to goods without upfront costs, it comes with significant risks, particularly for financially vulnerable shoppers. Research from the Federal Reserve Bank of Boston indicates that a majority of BNPL users already carry credit card debt, making them more susceptible to accumulating further financial burdens. The terms of BNPL plans can be opaque, with varying interest rates and late fees that may not be immediately clear. Experts warn that consumers should carefully assess their financial situation and avoid using BNPL for non-essential purchases, especially during the holidays. New regulations are being introduced to protect consumers, but understanding the intricacies of these plans is crucial to avoid falling into a cycle of debt.
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