While most Americans will mark milestones in the year or decade ahead, some may not greet them with open arms due to economic uncertainty. To gain insight into consumers’ plans for life events and how BNPL services may play a role, Citizens Pay partnered with Wakefield Research to survey 2,000 nationally representative U.S. adults with an oversample of 500 Gen Zers.
Milestones and Financial Strain
The passage of time is often marked by celebrating life events — such as getting married, buying a home, or sending a child to college — with 78% anticipating one in the next decade. And while some big events already evoke mixed feelings, concerns over the sizable price tag can add stress to otherwise happy occasions. Of those with a big event in the next decade, 60% say the financial stress outweighs that associated with the event itself.
From hiring a favorite wedding band to buying a home in the ideal location, Americans want milestones to be special. Among those who are married or plan to marry in the next decade, 82% wish they had the financial flexibility to afford wedding-related extras. This is especially important to Gen Zers (99%) and Millennials (91%). Meanwhile, 97% of those planning to buy a home say they want the flexibility to afford better features related to the purchase. Of those, 66% prefer a more desirable location, 51% better furniture, 47% more square footage, 43% smart home electronics, and 42% high-end appliances.
For most parents or prospective parents, merely making do for their kids is not enough. In fact, 74% of consumers who have or plan to have a child wish they had the financial flexibility to provide them with more. Similarly, 92% of those who have or plan to send a child to college, or to attend themselves, wish they could afford to enhance the experience.
The Benefits of BNPL
When seeking greater financial empowerment, particularly around big occasions, many see BNPL as a valuable resource — with 90% identifying some benefits. In fact, 28% of those who’ve used BNPL services for purchases of $500+ in the past year say it helped them enjoy life more, and 53% say the flexibility to buy big-ticket items is BNPL’s top benefit. Other notable benefits include ease of applying (39%), help with future budgeting (37%), and acceptance by most retailers (29%).
Gen Zers, who are often trying to establish a financial foothold, assess the BNPL’s benefits differently. Ease of applying (41%) rose to the top for them, followed closely by help with future budgeting (38%), flexibility to make bigger purchases (37%), and not needing a minimum credit score to apply (34%).
Changing Attitudes About BNPL
Although 35% of those surveyed say they know very little about BNPL services, perceptions about them are evolving. Of those who haven’t used it in the past year for purchases of $500+, 52% say they’re somewhat comfortable with the idea, while 20% are completely or mostly comfortable.
In an uncertain economy, consumers who have previously shown little interest in BNPL may change their outlook. In fact, of those who haven’t or didn’t plan to use BNPL in past year for purchases of $500+, 46% are very or somewhat likely to consider doing so as prices rise.
Trends also show that consumers who’ve used BNPL in the past year tend to desire more big-ticket items than those who haven’t. For example, 87% of parents or expectant parents who’ve used BNPL before are more likely to want more extras for their kids. Furthermore, individuals who use BNPL once are more likely to use it multiple times; 61% of those who used BNPL services for purchases of $500+ in the past year have an average of two BNPL loans.
The potential growth of BNPL services is building off already strong numbers. While credit cards and cash remain the most used forms of payment among consumers, BNPL usage in increasing; 18% have used BNPL services for purchases of $500+ in the past year, while 17% would consider doing so in the coming year.
Americans want to savor life on their own terms, which often involves celebrating milestones. And as most anticipate a major life event in the next decade, there’s ample opportunity for BNPL usage to grow.
The ability to make purchases, particularly big-ticket items, with predictable monthly payments makes Gen Zers and Millennials more inclined to utilize BNPL services. But with increased awareness of this and other benefits, all types of consumers are beginning to embrace the financial flexibility BNPL offers.