Buy Now Pay Later Consequences

(TORONTO, ON) – Canadians enjoyed their turkey dinners a long time ago, but that won’t stop them from joining their US neighbours in an American Thanksgiving tradition: Black Friday and Cyber Monday. This year, nearly one-third of Canadians plan to hop online and join the feeding frenzy, hunting for online deals on the websites of American and Canadian retailers.

Black Friday and Cyber Monday gained popularity over the last few years with Canadian Holiday shoppers, with some industry pundits speculating that Boxing Day will lose its place as the premier shopping day in Canada. But the mania of the shopping season has some financial experts worried that consumers will get swept up in the buy now pay later scheme and be left with regrets for months, if not years.

Consumers’ hearts are in the right place at this time of year, seeking out bargains to minimize their Holiday spending,” comments Jeff Schwartz, executive director of Consolidated Credit Counseling Services of Canada. “But if these deals end up on your credit card, you could be paying a lot more for them over the long run.”

Last Holiday season, two-thirds of Canadians shopped online; spending an average of $746 online compared to $382 offline. With online shopping comes credit card debt, and consumers are risking costly interest payments if they fail to pay off their balance in full.

With the help of Consolidated Credit’s Credit Card Debt Calculator, we looked at some Black Friday and Cyber Monday advanced deals to see how much Canadians would spend if they only made minimum monthly payments on their holiday bargains:

Item Discount Price Savings Time to pay off with minimum payments Total interest charged Total price
Samsung Refrigerator (Best Buy) $1,899.99 $1,000 14 years, 11 months $2,414.57 $4,314.56
MacBook Air (Staples) $899.00 $200 8 years, 8 months $829.63 $1,728.63
49″ LG TV (Future Shop) $799.99 $500 7 years, 9 months $671.31 $1,470.31
Snow Blower(Lowe’s) $599.00 $100 5 years, 4 months $354.66 $953.66

Calculated at 19% APR; Minimum payments = interest + 1% of balance

When you see the crime and punishment of making monthly minimum payments,” comments Schwartz, “it becomes very clear that any money you might’ve saved from a holiday discount is quickly evaporated.”

Keeping credit card balances in check is key to healthy finances this Holiday season, and Consolidated Credit has put together the following tips to help you steer the course during the shopping weekend and keep your budget on track:

  • Make a list and check it twice – Make a Holiday gift list according to an affordable shopping budget. Then revisit it and make sure your list isn’t out of control. Save the big gifts for immediate family and consider homemade gifts or other smaller gestures for others. Making a list can help you avoid the allure of online impulse purchases.
  • Browse and compare – If you’re shopping online, use the internet to your advantage! Compare prices with ease by using shopping apps like RetailMeNot or Push a Deal. You can also use sites that aggregate results like RedFlagDeals so that you don’t need to endlessly scroll to find the actual best price.
  • Don’t store your banking information – Yes, “one-click” shopping is easy and convenient, but skipping the process of entering your banking information robs you of a valuable opportunity to reflect on your purchase – “Do I really want this?”
  • Be secure – Avoid online fraud by making sure you’re on a safe and secure site. Only use sites that begin with “HTTPS” and look for a security icon such as a padlock in the address bar. Double-check the URL to make sure you’re on an authentic site – use and not something like If it looks risky, it probably is.

Holiday shopping should be an expression of love and generosity, not a sacrifice,” adds Schwartz. “Don’t spend what you don’t have and avoid the January credit card bills that so many people dread.”

About Consolidated Credit Counseling Services of Canada, Inc.:
Consolidated Credit Counseling Services of Canada is a national non-profit credit counselling organization that teaches consumers about personal finance.

For more information or to request an interview with Jeffrey Schwartz, please contact:

Jacob MacDonald, Public Relations Coordinator, Consolidated Credit Counseling Services of Canada, Inc., T: 416-915-7283 ext.1041, C: 647-390-5253, F: 416-915-5200, E: [email protected]

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