Save up or pay later?
Lesson 4 of 13 in our free Big Purchases guide: a 5-minute money game with the key points below.
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Questions you'll answer
A £600 sofa on finance: £30 a month for 24 months. How much extra do you pay compared with saving up?
Quick facts
- Fact: “0% finance can cost nothing extra — if every payment is made on time and it's paid off before the deal ends.” — Miss a payment or overrun the deal and fees or interest can kick in.
- Myth: “Buy now pay later never affects your credit file.” — Since BNPL became regulated, lenders do credit checks and missed payments can affect your file.
- Fact: “Finance agreements can make it harder to get other credit later.” — Lenders look at how much you already owe each month.
- New trainers you want for a night out → Save first. Want, not urgent. Save.
- Laptop needed for your course, deadline next week, 0% deal you can definitely repay → Borrowing might make sense. Genuine, urgent need — but check free help first.
- Holiday next summer → Save first. Plenty of time to save.
- Latest phone when your current one works fine → Save first. Upgrade itch, not a need.