How to introduce BNPL into your budget

BNPL isn’t just for online shopping, it can be used as a tool to manage your expenses. Find out how BNPL can be factored into your monthly budget.

Whether you’re a seasoned buy now, pay later (BNPL) user or a newcomer, you’ll know that it can be a great way to purchase products upfront and spread out the payments over a longer time period. It has become popular with those of us who enjoy shopping online, given the easy checkout experience and straightforward terms.

But what you may not know is that BNPL can be used as a tool to better manage your budget. A household budget is so important for managing your finances, allowing you to track your income and expenses to ensure you are spending within your means. It should include everything from your morning coffee to monthly bills.

BNPL can be used to manage certain payments over the course of a month rather than in one go. Unlike a credit card, you can see exactly how much your repayments are and when they are due, so they can be easily incorporated into your budget. By having a clear outline of your repayments, you can control your spending.

For the bigger things, you can apply for funds in advance of making a specific purchase. If approved, you get the amount you need and you also get a payment plan so you know what you have to pay and when.

What budget expenses can be covered with BNPL?

There are a number of ways BNPL can be worked into your budget.

Bills are a necessary inclusion in every budget; but sometimes monthly bills can coincide with annual payments and covering these large lump sums in the same week can disrupt your budget. BNPL can be used as a tool to spread the cost of bills over an extended period, rather than all at once, allowing you to continue your lifestyle as normal by managing the payment in smaller chunks.

Clothing and gifts can sometimes be forgotten when drawing up a budget, but are important to include. While these items may not feature every month, it’s helpful to have a strategy to cover those costs when they do crop up. 

For the bigger costs that you need to factor into your budget such as health and dental care appointments, you can use BNPL to spread these payments out over a longer period if required. And you always have the option to make an early payment if you wish to do so.

BNPL for unexpected costs

While every budget should cater to the regular expenses that crop up, it’s inevitable that some unexpected payments will crop up from time to time. That could be due to a leaky roof, shattered smartphone or emergency trip to the vet.

If you don’t have enough wiggle room in your budget to cover the costs upfront you may be tempted to dip into your savings, which could prevent you from reaching your savings goals.

BNPL can allow you to cover these unexpected payments upfront while keeping your savings on track. By spreading the payments out over a longer period of time you can adapt your budget to meet the repayments without compromising in other areas.

What to consider if incorporating BNPL into your budget

You won’t be required to pay interest with BNPL, but there are specified fees to consider such as late payment fees, while for larger payments you can expect monthly account keeping fees. By factoring in your repayments into your budget and any associated fees you can stay on track.

If using BNPL to help manage your budget, it’s also important to consider whether the retail partners align with your needs.

While humm partners with some great fashion and electronics retailers, it also offers essential services such as home repairs, dental and veterinary. It also allows you to select the repayment schedule that best suits your needs.

To explore the ways that humm can help you manage your monthly budget, check out how it works here.