I've noticed a flurry of articles lately about the explosive growth of Buy Now, Pay Later. The Globe and Mail reported that BNPL has gone fully mainstream, with Canadians across income levels stretching groceries and gadgets into “manageable” monthly bites. The Walrus ran a piece by Vass Bednar arguing that BNPL has quietly become a shadow credit system that doesn't show up on any credit bureau's radar until it implodes. Reading both, I couldn't help but smile. Not because the trend is amusing, quite the opposite. It's because we've been here before.
Long before Klarna, Afterpay, Sezzle and Affirm, there were Sears, Woolworth's, Kmart and Leon's. Canadians had layaway. No app, no one-click checkout, no influencer urging you to split a purchase into four easy instalments. Just a patient store clerk, a paper receipt, and a straightforward deal: you made payments over time, and only after the last one cleared did you take the item home, along with the quiet pride of knowing you'd earned it. Delayed gratification wasn't a burden; it was simply how responsible people bought things.
Try explaining that to a twenty-five-year-old today. “Wait... what? You paid for it, and they wouldn't let you take it home?”
Over the past forty years, we quietly flipped the model upside down. Yesterday's philosophy was pay first, enjoy later. Today, we enjoy first, pay later. The payment schedule looks remarkably similar, but the psychology could not be more different.
That took me straight back to my childhood, when my parents represented two entirely different schools of financial thought. To Dad, cash wasn't just king; it was emperor, prime minister, pope, and captain of the soccer team, all rolled into one. If he didn't have it, he didn't buy it. Mom's favourite line was different: “If I waited until I could afford it, I'd never get it!” One afternoon, she came through the door beaming and announced, “I saved a thousand dollars today!” This was the 1970s, real money, and we waited breathlessly to hear how. “I bought a baby grand piano,” she said. “It was four thousand, on sale for three. I saved a thousand dollars!” The room went silent. Technically, she wasn't wrong. Dad never fully embraced Mom's definition of “saving.” I believe he eventually paid off the piano. I'm less convinced he ever settled the argument.
Looking back, I don't think they were arguing about money at all. They were arguing about time. Dad believed that sacrificing today made tomorrow easier. Mom believed that tomorrow would work itself out. If they were alive now, Dad would still be carrying cash in his wallet, and Mom would have four BNPL apps on her phone and know exactly which one had the best promo running.
I suspect most of us carry a bit of both. We're remarkably good at convincing ourselves that Future Me will be wealthier, more disciplined, and generally more together than Present Me. Future Me will get the raise, won't mind another monthly payment, will eat well, will sleep eight hours, will exercise regularly, and will never procrastinate. Read that again. Now look in the mirror. Got you, didn't I? Future Me usually looks a lot like Present Me, just with a few more wrinkles and a little less earning power.
Behavioural economists call this present bias, or hyperbolic discounting: we place a much higher value on immediate rewards than on future ones. Nobel laureate Richard Thaler and Shlomo Benartzi built much of their retirement research around this tendency, and their Save More Tomorrow program showed how much help people need to overcome it (Thaler & Benartzi, 2004). Once you see that, BNPL stops looking like a payment option and starts looking like brilliant behavioural design. A $2,000 purchase quietly becomes “only $83 a month.” The price hasn't changed; our perception has. That, not the payment plans themselves, is the real story: the tug-of-war between Present Me and Future Me. That explains why so many Canadians struggle to save for retirement and often arrive there wishing we decided differently decades earlier.
Why Is BNPL Suddenly Everywhere?
Convenience is only part of the answer. The real drivers are rising living costs, stubborn inflation, and a culture that's grown allergic to waiting. BNPL fits that mindset perfectly: Payments Canada data shows usage rising from roughly 9% in 2022 to 25% in 2024. Younger Canadians cite quick access to credit, while middle-aged Canadians call it a budgeting tool. One group sees borrowing; the other sees it as managing cash flow as paycheques stretch less far. A recent Globe and Mail report on Koho's Grocery Gap data found that BNPL use for groceries more than doubled between May 2025 and May 2026, while incomes barely budged. Dad would have hated that explanation. Mom would have reminded him that life doesn't wait for your savings account to catch up.
Like most financial tools, BNPL is neither inherently good nor bad. A hammer can build a house or break a window, depending on who's holding it. If your furnace dies mid-winter, financing the replacement is one of the smartest moves you'll make. The same goes for emergency dental work or a computer you need for work. Those are investments, not expenses. Financing concert tickets or a smartphone upgrade because yours is eighteen months old is a different category, one where Future Me keeps paying long after Present Me has finished enjoying the fun. Whenever I'm unsure where a purchase belongs, I ask one question: will this make my financial life stronger a year from now, or will I still be paying for it?
Retailers didn't embrace BNPL out of concern for our budgeting skills; they embraced it because it works. Research from the National Bureau of Economic Research found that offering BNPL at checkout increases sales by roughly 20%, largely by nudging people to spend more than they otherwise would (Berg et al., 2024). The product hasn't changed, and your income hasn't changed; only the payment method has. That's why “$89 a month” feels far less alarming than “$2,500,” even though the math is identical.
A Word on Fraud
Here's a related trend that concerns me, especially for older homeowners: be cautious when someone knocks on your door offering a new roof, windows, or solar panels for “only a few dollars a day.” Before signing, ask: did I think I needed this before the salesperson showed up? Sometimes yes. Roofs wear out. But sometimes the problem is manufactured right along with the financing, and a $25,000 renovation can sound reasonable when framed as “less than your cable bill.” Dad would have insisted on three quotes; Mom would have admired the enthusiasm. Listen to Dad: get multiple estimates, loop in someone you trust, and never sign on the spot. Read that again. Never sign on the spot!
The RRSP Parallel and What Retirees Should Watch For
BNPL also parallels something I wrote about recently in Canada's RRSP Program Has Too Many Jobs. The Home Buyers' Plan looks nothing like Buy Now, Pay Later on the surface, but look closer, and they sound alike. Both solve today's problem by borrowing from tomorrow's resources. It's helped thousands get into homes, and homeownership remains one of the best long-term wealth builders. But every dollar pulled from an RRSP stops compounding for retirement. We celebrate the house and quietly forget the retirement income we gave up for it, Present Me negotiating a deal Future Me eventually must honour. And Future Me always shows up, whether we're ready or not.
It's tempting to think of BNPL as a young person's problem, but the psychological pull intensifies in retirement, not diminishes. When you're working, the next paycheque is a couple of weeks away. In retirement, every purchase competes with a finite pool of assets that may need to last thirty years. Financing groceries isn't a budgeting strategy; it's a signal that your income isn't keeping pace with your lifestyle. If every purchase starts with “what's the monthly payment?” instead of “can I actually afford this?” it's time to step back. I've long recommended imagining every purchase as a conversation with your retired self: would Future Me thank me, or wish I'd shown more restraint?
Isn't a Reverse Mortgage the Same Thing?
Some readers wonder whether reverse mortgages belong in this conversation. I'd argue they're nearly the opposite. Both involve money today and repayment later, but that's where the similarity ends. BNPL borrows against tomorrow's income to finance today's consumption, while a reverse mortgage, used appropriately, converts wealth you've already built into retirement income. One asks Future Me to earn more; the other recognizes that Past Me already did the heavy lifting. There's a world of difference between borrowing against tomorrow and drawing on yesterday's success.
Whatever Happened to Paying Cash?
Dad's advice was simple: if you can't pay cash, don't buy it. It's a little outdated now. Few of us carry cash anymore, and digital payments are so seamless that spending barely feels like spending. Tap, click, done. Maybe the rule just needs updating. Instead of “can I pay cash?” try “if I had to pay for this in full today, would I still buy it?” That shifts our focus from the monthly payment to the total cost and from affordability to value. BNPL isn't inherently good or bad; it's a tool like any other, and the real danger is forgetting that every financial decision is a negotiation between Present Me and Future Me.
What My Parents Really Taught Me
Looking back, my parents weren't really arguing about money; they were arguing about time. Dad taught me the value of patience and living within my means, and he understood instinctively what behavioural economists would later prove: delaying gratification pays remarkable dividends. Mom taught me something just as important: that life isn't meant to be spent waiting forever, and that some experiences create memories no investment account can measure. The wisdom lies in knowing the difference. Retirement requires both the discipline to save while working and the wisdom to enjoy what you've built. Save every penny and never spend it, and you've missed the point, tragically. Spend it all before retirement arrives, and biology has a nasty habit of showing up right on schedule, winning every time, just as tragically.
Perhaps that's the real story behind Buy Now, Pay Later. It was never really about payment plans; it's about patience, priorities, and the lifelong conversation between who we are today and who we're becoming tomorrow. Present Me always gets the microphone, while Future Me waits quietly in the wings, hoping today's decisions leave something to work with. Next time you're offered four easy payments, ask the better question: will Future Me thank me for saying yes? Someday, Future Me becomes Present Me, and that's the day we find out whether today's purchase was an investment in our happiness or just another bill waiting, not so patiently, for retirement.
I have a feeling Dad would smile reading this, quietly certain he'd finally won the argument. Mom would smile too, already wondering if she could get that validation in four easy instalments, and still call it saving money.
Don’t Retire … Re-Wire!
Sue
My Book is Now Available for Pre-Order
I hope you will consider pre-ordering a copy of Your Retirement Reset for you, a friend or loved one. It's available September 29, 2026 published by ECW Press - You can now order at Indigo or Amazon. And if you love supporting Canadian booksellers, please also check with your local independent bookstore. Most can easily order it for you.
