Should you buy now and pay later this season?

RICHMOND, Va. (WRIC) — Are you opting to buy now and pay later this year? Before you checkout, experts say you should know the pros and cons of splitting up payments.

Let's set the scene, you are finally making it through your holiday shopping list and an electronic you've been eyeing for months finally makes it to your cart. Before you check out, you have the option to pay for the item in full or split up how much you pay into four interest free payments. If you choose option two, you are choosing to buy now and pay later.

The payment plan has grown in popularity over the years with services like Affirm, Afterpay and Klarna offering shoppers the opportunity to break up how much they pay for a desired item at a time.

According to a Bankrate survey, one out of every three people say they've decided to buy now and pay later for items like electronics, clothing and appliances. During Cyber Monday shopping this year, Adobe Analytics found shoppers spent more than $1 billion online using buy now pay later methods.

8News asked Stephen Day, Director of the VCU Center for Economic Education and Author of Teach a Kid to Save, why the payment option is becoming so popular.

"I don't think people have adjusted to higher interest rates. They were used to paying for things with cheap interest. Now they're paying with more expensive interest and that cuts into our budgets," Day said.

Day researches personal finance trends and said this one can have it's perks like flexibility and store rewards.

“If you don't have enough money, if you're waiting for that paycheck next month this can be a short term credit that can get you through the Christmas season,” Day said.

Despite this, he said consumers should weigh potential risks like unexpected fees and overspending.

“You could lose your job. There could be some money that you thought was going to come in that didn't come in. Or more likely, you're going to have some expense that pops up,” Day said.

Bottom line, Day said you should treat the service like a loan and keep up on your payments. He recommends planning ahead and saving the money you need before you checkout.

“Don't pay somebody else for loaning you money. Try to get ahead a little bit," Day said.