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‘It Ruined Everything’: Buy Now, Pay Later Drives Gen Z Into Debt

Digital payment products have become particularly attractive – and risky – for young consumers.

The Afterpay App as Square to Buy the Australian Buy-Now, Pay-Later Company for $29 Billion
Photographer: Brent Lewin/Bloomberg

Sarah Pfefferle had already saved $16,000 for her future home by the time she was 18. Then she started using buy-now, pay-later products and “ruined everything.” 

In just two months, the Chicago native racked up $5,000 in debt across three of the installment-loan firms. The ballooning balances, alongside unexpected medical costs, drained much of her savings and prompted her to seek help from a financial adviser. But the damage was done: Pfefferle’s credit score dropped to 580 from 720 after she closed her accounts.