There was a time - a long time ago - when people saved money to buy something they wanted. Then came " Bankcard " and a whole range of instant credit allowing them to gratify their desires instantly - and pay later !
Now that sales strategy has taken several steps further. The media is saturated with advertisements offering " No deposit - no interest - until a date from eighteen months to several years in the future ".
The message is " You can have it all now " - and huge numbers of people are falling into this debt trap. It is probably manageable for those who have a sensible budget plan and start reducing the loan with regular payments to eliminate it before that distant future date, but many reach that date with the money still owing - and then find that a vast amount of accrued interest falls due.
Another " buy now " scheme is rife with both pay TV and broadband offerings. There are inducements to sign up now - which include free or subsidized installation, free modems - and a very attractive price tag - until you notice that this is for a period of several months.
Most of these offerings have a requirement in the fine print that the contract is for twenty-four months. When the " el-cheapo " introductory offer expires the normal rate cuts in - and the buyer is stuck with that for the rest of the contract period.
Buying with extended credit - which is what most of these schemes really are - is a perilous venture. You are committing your income to an uncertain future and inviting financial calamity should there be an unplanned pregnancy in the family - removing a wife from the workforce - or some form of job loss or injury occurs to the main bread winner.
The first law of commerce applies to all these schemes - and that is - " Buyer beware ! ".
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