"Buy Now, Pay Later" (BNPL) can feel like a "treat yourself" pass, but it's not magic; it's psychology. This episode looks at why BNPL systems are so seductive, especially for those with financial instability or emotional trauma. We also look at actionable steps to manage BNPL use, such as identifying the emotions behind spending and addressing financial shame.
"Buy Now, Pay Later" (BNPL) can feel like a "treat yourself" pass, but it's not magic; it's psychology. This episode looks at why BNPL systems are so seductive, especially for those with financial instability or emotional trauma. We also look at actionable steps to manage BNPL use, such as identifying the emotions behind spending and addressing financial shame.
Transcript: https://savvy-psychologist.simplecast.com/episodes/how-buy-now-pay-later-companies-use-psychology-to-hook-you/transcript
Savvy Psychologist is hosted by Dr. Monica Johnson.
Have a mental health question? Email us at psychologist@quickanddirtytips.com.
Find Savvy Psychologist on Facebook and Twitter, or subscribe to the newsletter for more psychology tips.
Savvy Psychologist is a part of Quick and Dirty Tips.
Links:
https://quickanddirtytips.com/savvy-psychologist
https://www.facebook.com/savvypsychologist
https://twitter.com/qdtsavvypsych
https://www.kindmindpsych.com/
I’ve heard this so many times—from patients, at the beauty salon, and all across social media threads, we love to shop, we want to go to Coachella, but we can’t afford it. Then that little “Buy Now, Pay Later” button shows up at checkout, it feels like a magical “treat yourself” pass from the universe.
But here’s the thing: BNPL isn’t magic. It’s psychology. And if we’re not careful, it can be a fast track to financial stress, shame, and a lot of “what was I thinking?” moments.
Let’s unpack why these systems are so seductive—and how they hook people, especially those who’ve already been through economic or emotional trauma.
Welcome back to Savvy Psychologist, I'm your host, Dr. Monica Johnson. Every week on this show, I'll help you face life's challenges with evidence-based approaches, a sympathetic ear, and zero judgment.
Buy Now, Pay Later services like Afterpay, Klarna, Affirm, and Sezzle are everywhere. They're marketed as smarter alternatives to credit cards—interest-free (at least upfront), easy to use, and designed to help you "budget better." But behind the cute branding is a billion-dollar industry that knows exactly how your brain works. By 2023, one in three Americans had used a BNPL service—and usage was highest among Millennials and Gen Z. Top categories? Clothing, electronics, and beauty. You know, the stuff we emotionally justify in 0.2 seconds. Unlike traditional credit, BNPL often doesn’t require a credit check, making it accessible—but also riskier.
Now before you blow up my comments. I want to be clear that I understand the impacts of inflation, financial binds, etc. There are people who are using these services for groceries or other necessities. That’s a different conversation. I’m looking at the person who did their 23rd shopping haul for the year, who just turned their Doordash order into four equal installments, or would rather purchase an unaffordable trip and simply pass that problem on to their future self.
Let’s break down some of the psychological levers that BNPL companies pull.
BNPL systems activate your brain’s reward center—especially the dopaminergic pathway that craves novelty, pleasure, and relief. This delays the pain of paying. Spending money, to some degree, hurts. BNPL numbs the financial sting long enough for you to click “confirm.”
When you break a $120 purchase into four $30 payments, it feels manageable. You think, “I got this.” And that illusion is powerful. We’re more willing to spend when we don’t see the full amount. BNPL reframes spending as small bites, not a big meal. But you can still choke on it.
Many BNPL purchases happen in contexts driven by scarcity tactics: limited-time deals, flash sales, or “Only three left in stock!”
Add to that our old friend FOMO—Fear of Missing Out—and suddenly you’re justifying a purchase because “I’ll never get this deal again.”
BNPL says: “Don’t miss out just because you’re broke today.”
Trauma survivors, particularly those who’ve experienced financial instability, can be especially vulnerable here. That “I deserve this” narrative hits deep—because it’s not just about the item, it’s about reclaiming agency, worth, and dignity.
If you want more on the financial side of BNPL, I suggest you listen to episode 735 of the Money Girl podcast, also on the QDT network. I’ll link that in the show notes. Now let’s talk about how BNPL can lead to debt even without so-called interest.
Multiple Stacked Payments
You don’t just use BNPL once. You use it for the shoes, then the makeup, then the headphones, then the concert ticket. Before you know it, you’ve got five different payments due every two weeks. And because these aren’t centralized like credit card bills, many people lose track. A 2021 study by Consumer Reports found that 43% of BNPL users missed at least one payment.
If your checking account doesn’t have enough money when the automatic payment hits, you can rack up overdraft fees, late fees, or even penalties that affect your credit—despite what some companies claim.
Debt Creep
The emotional detachment from spending real money makes BNPL a gateway to habitual overspending. I’ve watched TikTok videos where folks say they have 52 BNPL loans and $1700 worth of payments per month. This type of recurring debt can negatively impact your mental health. You’re not budgeting—you’re emotionally bypassing. And when reality catches up, you may be deep in a shame spiral.
As a trauma-informed psychologist, let me be real with you: For many of us, money is not just math—it’s memory.
Especially if you: Grew up in poverty or food insecurity. Were raised in a household where money was unpredictable or shameful. Use shopping to cope with emotional distress (hello, retail therapy).
BNPL is marketed as empowerment—but for those that grew up financially insecure, it can become a slippery slope from “treat yourself” to “trap yourself.”
If your nervous system equates shopping with security, BNPL becomes a fast-acting sedative for anxiety, loneliness, or depression.
Shopping becomes a form of emotional regulation—a way to soothe yourself when therapy feels too far or rest feels too guilty.
Okay, So What Can We Do?
Ask yourself: “What am I really feeling right now?”
Are you buying because you’re bored, sad, anxious, or feeling less-than?
Unfollow brands and influencers that make you feel like you’re never enough unless you buy more. You don’t need another ad telling you your self-worth can be bought in four easy payments. Quite honestly, for me, if I see someone shilling a different product daily, I look at them like they are a QVC or HSN sales person. If you don’t know what that is—it’s basically homeshopping channels where people demo products and talk about how amazing they are. Originally, when influencers were on the scene before the term was coined, it felt like you were talking to a real person who was actually recommending you a product. Now, it’s simply a paid spokesmodel again.
If you unsubscribe, you reduce the likelihood of impulse buying. There are so many situations where a person can go—is this an Amazon must-have or did the algorithm lull me into pulling out my credit card. Don’t let anyone Pied Piper you out of your paper. You worked hard for that money.
3. Use BNPL for Needs, Not Emotional Fixes
If you must use BNPL, reserve it for emergencies or essentials—not emotional band-aids. Need new tires but short on funds? That’s different from needing a new $300 jumpsuit to feel “cute and confident” after a breakup. Therapy is cheaper in the long run.
4. Work on Financial Shame
Shame keeps us from asking for help, setting boundaries, or facing our patterns.If BNPL has led to debt, that's okay! We’ve all made financial mistakes at some point in our lives. Take accountability and seek support if needed. Therapy, support groups, or even financial literacy workshops can help you build self-compassion and financial clarity at the same time.
Has BNPL got you caught up? Let me know! You can contact me via Instagram @kindmindpsych or via my email at psychologist@quickanddirtytips.com.
The Savvy Psychologist is a Quick and Dirty Tips podcast. It's audio engineered by Steve Riekeberg. The Director of Podcasts is Holly Hutchings. Our Podcast and Advertising Operations Specialist is Morgan Christiansen, and Nathaniel Hoopes is our Marketing contractor. Follow Savvy Psychologist on Apple Podcasts, Spotify, or wherever you listen to podcasts. That's all for this episode of Savvy Psychologist. Thanks for listening! I'll see you next week.