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The Fine Print of BNPL Services and the Cost of Clutter

Jean Chatzky  |  December 21, 2021

Are Buy Now, Pay Later services too good to be true? Find out the skinny on programs like Affirm, Afterpay, and Klarna.

Not subscribed to HerMoney’s weekly newsletters yet? This is what you’re missing! Here’s a look at what we published in our “This Week In Your Wallet” newsletter, Tuesday, December 21, 2021.  Subscribe Today!

This Week In Your Wallet: The TL;DR On BNPL

Are you among the 60% of shoppers who’ve used a Buy Now, Pay Later service like Klarna, Affirm or Afterpay this holiday season?  Yup, 3 in 5 have said ho-ho-ho, I’ll give it a go (or something to that effect). And on the surface, you certainly can’t blame them. It looks like a way to spread one payment out over a couple of months interest-free.

But that was before HerMoney’s Kathryn Tuggle went out to return a big winter coat (it wasn’t the coat, she says, but her freakishly long arms) and discovered the dirty little secret of BNPL services. Returns can be hellacious. We tell you this because, hey, we’ve got your back. But also, we know that you’re not quite done shopping and you’re about to hit that season of heavy duty returns. 

Her data download on the hoops you’re going to have to jump through if you’re looking to take back something you bought using one of these services should be required reading. Dig in before you let a return take all the jolly out of your holiday.

Sometimes There’s No Good Way To Switch Gears

After I sent out last week’s newsletter, I got a note from Carol, a reader in Benton, Kentucky. She and her community had been through the devastating tornadoes that hit the area, and she wrote: “I think you should write about what you should do if you lose everything.” 

Carol, first of all, to you and all of your neighbors who are suffering, words feel insufficient. But we are so sorry for what you have been through. And to the many others who will experience the more frequent natural disasters that seem to be a part of our world, there are steps to take in the aftermath. The writers at MoneyWise put together a comprehensive guide that can help you find a safe place to stay, including instructions for the people you’ll need to call (your insurance company and mortgage lenders among them) as well as federal, state and charitable resources that can provide assistance. I’ll link to it here.

I was also interested in a story The Washington Post published about lessons in rebuilding the community of Joplin, Missouri – one-third of which was leveled by a tornado a decade ago. It’s a story of difficulty, yes, but also hope and success. With the exception of a single year when it dipped, the population of Joplin has grown every year since the tornado swept through. Even more inspiring, the volunteers, city workers and community members who went through the disaster put pen to paper (or fingers to keys) to chronicle their advice for other communities experiencing similar tragedies. You can download it here.

And just a reminder: Before disaster hits, make sure your homeowners insurance will do its job if needed. And, if you have time to gather documents before you evacuate, here’s what you should focus on grabbing.

Is Clutter A Health Or A Financial Issue?

I’ve got to say, I always thought of it as the latter – perhaps that’s my skewed perspective talking – and then I read The New York Times Personal Health Columnist Jane Brody as she tackled the topic this week. Clutter can be a danger, she points out, the sort you might trip over on your way to the bathroom in the middle of the night, or even mid-day if your eyes are on your phone. But it can also, she writes, be “distracting, stealing attention from worthy thoughts and tasks.” I can certainly relate to that. My favorite way to procrastinate is by cleaning out a closet.

The comments, naturally, poured in. My favorite was from Phyliss, a reader in Wichita, Kansas. “The subject has caused more stress and strife in our 40 year marriage than any other. I’m generally a neat freak, the husband is a slob, to put it nicely. He has college textbooks that have survived countless moves, and have not been opened/read in decades. He also has old computers, cameras, stereos, man toys. This has all been exacerbated by our cleaning up, and cleaning out my late mother’s place in Florida. She was a hoarder, of the clean version. Every discard or donation must be discussed, as  ‘someone might want it.’ Yeah, sure. Find that someone, and bring them here to pick it up. Now. I’m exhausted.”

Manchin Tax?

Finally, maybe you’ve heard by now that the Build Back Better plan is not Senator Joe Manchin’s (D-WV) cup of tea. We’ll let you read the politics on that elsewhere, but for now, if you were worrying about losing the backdoor Roth that allowed you to stash away beaucoup pretax bucks, it looks like that window will be open a little bit longer.  (For everything you ever wanted to know about this strategy (or anything else about IRAs) here are a couple of podcasts to help. On the flipside, for those of you in high property tax states, the cap on that SALT deduction is sticking. For now.

Have a great week,

Jean

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