‘Buy now, pay later’ is the fastest way to pay for your purchase.

Buy now, pay later (BNPL) has quickly become a popular way for many people to pay for everything from new furniture to vacations. Nearly half of U.S. adults have used a BNPL plan at least once, allowing them to purchase on installment plans.

However, the downside to BNPL is that some people may hold onto their loans for too long and sometimes miss payments, potentially resulting in high interest rates and late fees. Data from Statista shows that 13% of BNPL users have had to pay additional fees or interest when they buy now and pay later.

Here’s how to deal with your BNPL debt quickly to get your personal finances back on track.

The fastest way to pay for BNPL purchases

Without a doubt, the fastest way to buy now and pay off debt later is to use the money in your savings account to pay off the total amount right away. Paying off your balance in full will prevent you from incurring late fees and preventing additional interest from being accrued on the amount you owe.

This strategy is simple, but also difficult to execute.

The average American has a savings account balance of $1,200, according to a recent survey from The Motley Fool Ascent. This means that it may be financially difficult for some people to pay off their BNPL purchases immediately.

However, if you have enough money in your savings account to cover the total amount of BNPL, consider using it. Of course, this will reduce your available cash, but you can quickly rebuild your savings by setting up a monthly automatic deposit with the same amount used for BNPL payments.

Two additional ways to quickly pay for your BNPL purchases

If you don’t have the cash to pay off your purchases right away and later, here are some suggestions to help you get out of debt faster.

1. Pay more

This may be the simplest way to repay your BNPL purchases more quickly. If you use this strategy, you’ll end up paying more than you need to in installments. For example, if you pay $100 per month on an installment plan, you can pay $125 instead. Doing this 4 times will be the same amount as 1 additional payment.

2. Use the debt snowball method

If you need to repay multiple BNPL purchases, it may be helpful to use the debt snowball method. This debt repayment strategy focuses on paying off your smallest debts first and then working your way up to your larger debts.

Let’s say you have two BNPL accounts. If you pay $25 a month, you’ll have $500 left over to buy a new phone. The other is $75 per month for a $1,500 balance to purchase a new sofa. With the debt snowball method, you pay extra for a $500 phone first and pay it off as quickly as possible.

Once repaid, you’ll be paying $100 per month for the sofa, adding a $25 per month phone payment to the $75 per month sofa payment. Investing an extra $25 a month on a sofa can help you pay off your balance faster and get out of debt faster.

Carrying a BNPL balance can be burdensome, but the first step to eliminating it is facing the problem and finding a solution. Creating a budget will help you manage your monthly expenses and help you find areas where you can cut back on spending and put extra cash into a buy now, pay later account.

If you need additional help managing your debt, including your BNPL account, check out these helpful tips on how to pay off your debt.

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