A (57:33)
Berman's experience also talked about the kind of debt spiral that's involved with this. I have a qualm with this portion of the piece. It is not the piece itself, but the quotes from Berman. Because Berman says in it, kind of talking about how this goes, quote, $17 first thing Monday, $250 later that night, and then talks about no clear balance tallies and payments that felt, quote, totally arbitrary. Says you never know what's going on. You can't budget because you don't know what's leaving your account on what, what day. I don't agree with that. Part of was my experience using at least two different Buy now, pay later services over time that these services make it very clear about what you owe and when and even give you like calendar, calendar readouts that show this is the amount of money that's going to come out on this day. This is going to come out on this day. This is going to come out on this day. I would imagine that if you start adding these up over time and you've got a bunch of them across different apps, which is the experience that Berman had, it can be difficult to figure out what's going on. But to assert that it's totally arbitrary, that there are no clear balance tallies, that you know, that you never know what's going on, that you can't budget because you don't know what's leaving your account on what day. While that can be the personal experience that you had, that you're not sure what's leaving your account on what day, I disagree that it is not provided to you. You can go in and look at it. Berman ended up tallying everything owed about $20,000. And according to Federal Reserve research, this is kind of a, I mean, what I'm about to read, I think many of you go, oh yeah. The article cites Federal Reserve research that shows that Buy now, pay later users have lower. This is, quote, lower overall financial well being. Yeah. If you, that's, that's why you would use a Buy now, pay later service. You can't afford to pay for it all now. And so you, you split it up into payments. I did not have good financial well being, you know, living relatively paycheck to paycheck at the time. And so this was my way of being able to afford that mattress but it's a regulatory vacuum because these services operate with minimal oversight. They skirt the Card act of 2009. They skirt the Truth in Lending act because they structure loans to avoid triggers for regulation. The Consumer Financial Protection Bureau tried to apply credit card rules to Buy Now, Pay later efforts, but they were reversed after Trump's second term began. Now FICO does plan to start including Buy Now, Pay later history and credit scores. And this is the thing, it's going to shock a lot of people who've been treating this debt is a bit of a joke on social media. There are loads of different posts where people are posting their notifications from Klarna saying, you know, you've got this, you've got this, you've got this, and you're suddenly, and you're like comparing the amount that you owe Klarna and you want the higher amount. No, you don't want the higher amount. Speaking also from personal experience, I have a family friend who fell into something very similar to this individual who racked up a whole heck of a lot of debt by switching between the different services, switching between Klarna, between afterpay, between a firm, between other options. Given that much of this is currently not tracked by fico, is not tracked by some of these other services. And so that is what is at issue here. So definitely something that I recommend sort of looking out to your family, your friends and, you know, checking in on how people are making use of these Buy now, pay later services. I think some people who are in a good place financially or in a great place financially, we'll look at these services and look at the people using these services and kind of look down. That's been, you know, I've seen that at work. And so I'm very careful in saying and expressing that I have made use of these in a very positive way for me and they can be used in a positive way to give people access to things, especially as things get more and more, more expensive that you might not otherwise be able to gain access to. And do not get me started on sleep in sleep science and how investing you might go, well, you just need to go get, you know, John's looking at me like, please don't you just need to go get some eggshell containers from egg crates from the store and put them on, on a flat piece of concrete if you can't afford a good mattress and blah, blah, blah, blah, blah, blah. Don't use a buy now pay. No, I, there are situations where these things are worth the investment, even if it's not an investment that you can technically make all at once. And so I'm not looking I will not look down on people making use of Buy now pay later services. I will look down on how buy now pay later services can be incredibly predatory. So just something to be mindful of and please go read this piece from New York Times Magazine. It's far more in depth and I think is something that should be shared around with other people. With that we've reached the end of this episode of Tech News Weekly. Of course our show publishes every Thursday. TWiT TV TNW is where you can go to subscribe to the audio and video versions of the show. If you'd like to get all of our shows ad free just the content, can I invite you to join our club Twit TV Club Twit is where you go to sign up. When you join the club you gain access to to some awesome things ad free versions of all of our shows. Love you. 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