On the whole, I agree. Usually wouldn’t consider them.
However, a few years ago I bought a rather expensive item (several thousand dollars) and I was ready to just pay for it outright, but one of the payment options was 0% financing though one of these pay later companies with payments spread out over 4 years. So, I did that a put the money in a safe investment.
So I essentially got two discounts on the purchase. 1) the growth in the investment means I’m less out of pocket on the purchase, and 2) due to inflation, the dollars I’m using now to make payments are technically worth less than they were three years ago.
There’s been a few times in my life that I’ve been able to take advantage of 0% financing for large purchases and I’ve never regretted it. But, for the strategy to work, you have to A) be willing and able to just buy the thing outright, without financing (the financing can’t be a factor in your decision), and B) have the self control to not touch the invested money to make some other impulse buy.
ETA, another thing to watch out for is smoke and mirrors, where they claim 0% financing, but they’ve really just raised the price to cover what they would have made in interest charges, and then have a “discount for cash” type offer where you pay less if you don’t finance. Usually better to not finance in those scenarios.
On the whole, I agree. Usually wouldn’t consider them.
However, a few years ago I bought a rather expensive item (several thousand dollars) and I was ready to just pay for it outright, but one of the payment options was 0% financing though one of these pay later companies with payments spread out over 4 years. So, I did that a put the money in a safe investment.
So I essentially got two discounts on the purchase. 1) the growth in the investment means I’m less out of pocket on the purchase, and 2) due to inflation, the dollars I’m using now to make payments are technically worth less than they were three years ago.
There’s been a few times in my life that I’ve been able to take advantage of 0% financing for large purchases and I’ve never regretted it. But, for the strategy to work, you have to A) be willing and able to just buy the thing outright, without financing (the financing can’t be a factor in your decision), and B) have the self control to not touch the invested money to make some other impulse buy.
ETA, another thing to watch out for is smoke and mirrors, where they claim 0% financing, but they’ve really just raised the price to cover what they would have made in interest charges, and then have a “discount for cash” type offer where you pay less if you don’t finance. Usually better to not finance in those scenarios.