Why Has Debt Become So Ingrained in American Culture? The Advent of Buy Now Pay Later

Debt has become highly ingrained in American culture. Our entire economy and all the products and services sold within it are meant to make consumers consume as much as possible with what little they may or may not have. This economic mechanism promotes consumerism which is totally normal in a capitalistic society. However, it has gone a bit too far with the addition of Buy Now Pay Later and other recent financial innovations.

We as Americans all love buying things and all love consuming things, it’s deeply ingrained in our culture and our way of life and it’s how a lot of us connect with each other on a fundamental basis. We often reminisce about food, childhood toys, our favorite places to visit, our favorites movies, etc. However, the instant gratification has gone a bit too far with Buy Now Pay Later and really has begun to steer us away from the middle path we used to follow. It’s an economy that wants to fulfill all our desires ASAP, regardless of the cost. And there is always a cost, whether we are aware of it or not. When these nuances becomes ingrained into the culture and foundation of our society it becomes very difficult to steer away from and reverse.

We need not look too far. We have loans for everything. We have credit cards for everyday spending and everyday purchases, they offer rewards on different spending categories and cash-back rewards and travel rewards. These rewards incentivize spending and consumption and often times the rewards usually make us spend more than we would have otherwise. If we get travel rewards from our credit card, our spending is rewarded with a vacation we otherwise might not have went on, if we instead got a statement credit. This positive feedback loop and reward mechanism is designed to further spending by any means necessary regardless of the “spending category”. If you reward consumers for how much money they spend, they will naturally incline towards spending more and that is the real reason why these reward mechanisms have all been put in place.

We get mortgages for homes we want to purchase. The mortgages allow us to buy homes we would not have been able to afford otherwise. This means that the value of all homes go up and home prices increase. So, more money is spent on interest payments for the higher priced homes. More taxes are paid for the high appraisal of the home’s value, etc., etc. This is how lending and borrowing exasperates spending within our economic system, which inevitably leads to increases in asset prices.

If we didn’t have mortgages the prices of homes would be not be where they are currently. But if we didn’t have mortgages who knows what our economy would even look like. It would be a whole different world! The economy would not be as robust either, with multitudes of money flowing from here to there. However, it’s a double-edged sword and why we should always try to walk a thin line.

Consumers also have auto loans available to help them buy new cars. For many consumers, auto loans allow us to afford better and nicer cars than we would’ve been able to otherwise buy if we just used “cash”. Because of the car loans, the prices of cars increase and this tends to lead consumers to buy more car than they actually need and can afford. Therefore the car industry sees a boost, as does lending, etc., etc. This is how borrowing and lending stimulate and increase the price of durable consumer goods like automobiles, etc. The same applies for furniture, appliances and other durable consumer goods.

Everything is for sale and everything is available to borrow. We have so many different funds available to us for so many different reasons and no shortage of reasons to borrow money.

We have lines of credit and credit cards and then we have Buy Now Pay Later services. If you go on X you'll see no shortage of memes about consumers that have begun using Klarna to purchase burritos with BNPL and although it's a funny joke, it’s also become a serious problem. We really shouldn’t have Buy Now Pay Later as a service for the use of purchasing burritos.

Have you ever thought about why Buy Now Pay Later services have become so popular even though they do not charge interest for purchases? Buy Now Pay Later services get consumers to charge more money and borrow more money. These services pull spending out of consumers so that they spend more sooner rather than later. The sooner we spend it the better it is for the economy and corporate profits. Now, there’s nothing wrong with corporate profits but there definitely needs to be a limit!

This is one of the main reasons our economy has become so burdened with high interest debt. If we spend towards the upper limit of our all our available money, it leaves us less inclined to pay the debt down within the time frame we need to in order to get things under control and get the interest payments out of our lives.

This is why it’s so important to keep a safety net and not spend above our limits (if we are without savings). Otherwise, it could leave us in a painful situation if any outside the budget expenses arise and take us for a loop.

This is why we need to spend responsibly and try our best to also have a backup plan just in case things don’t go our way. We never know the obstacles life can throw our way. So, it’s best to remain grateful and humble and try to avoid over-reliance on BNPL and credit whenever possible.

Over-reliance on credit can lead us into big trouble and makes us assume that the default is “things will always be this good”. Things won’t always be “this good”, they can always be better but they can also be a lot worse. However, the important thing is we can’t forget to be financial responsible regardless of whichever scenario we are in. It’s not easy, but we need to try and stay steadfast whenever possible.

When the going gets tough the tough gets going. Things don’t always stay the same and we need to try and roll with the punch no matter how life goes. The same goes with debt and finances. When things come they tend to come at you all at once. It’s tough to find a happy medium and a middle ground but when you do make sure you hold onto to it the best of your abilities. Without a happy medium our finances can just tend to go about aimlessly leaving our financial goals out of sight.

The easiest way to get ahead is to stop overspending on online purchases and by trying to avoid borrowing for “wants” altogether. Whenever consumers borrow for things they “want” they tend to get in a great deal of trouble.

Getting ahead in a world filled with loops and valleys and peaks and turns and all types of financial hazards might not be easy but it’s doable. If we create a well thought out plan and stick to it we can achieve our goals.

I’m not one to judge and to say what is right or what is wrong but one thing is for sure, when we spend within our means we will surely live a better life along the middle path and be more inclined to stay away from financial troubles.