Gen X Uses Buy Now, Pay Later As Much As Younger Demographics

August 9, 2023

June saw a collaboration between PYMNTS and Sezzle, titled “The Credit Economy: How Younger Consumers Make Credit Decisions,” which revealed that Buy now, pay later (BNPL) payments are rising in popularity.

It was previously thought that BNPL was only popular among younger consumers, such as Millennials and Gen Z, however, the new findings revealed that to be inaccurate, as Gen X, born between 1965 and 1980 have surprisingly taken to this payment method.

Gen X is more likely to use credit programs, as 43% of surveyed individuals said they have a mortgage and 39% have car loans. Their use of BNPL is more of an “add-on”, secondary to loans or credit cards, however they do seem to prefer it when making big purchases, as BNPL allows them to pay everything in simple installments without interest and with a clear timeframe.

These purchases range from non-essential items to necessary items, but clothes seem to be the preferred item to BNPL, AT 21%, followed by furniture (10%).

Gen X is the demographic that uses BNPL the most in healthcare, at 3.7%, and education at around the same percentage. They prefer BNPL for these purchases because, as previously mentioned, BNPL does not charge interest and allows consumers to pay a determined item or service over time, which is necessary when so many people have to limit their budget each month.

Gen X’s greater use of credit products compared to other age demographics may partially be driven by the age cohort’s “sandwiched” lifestyle in which they may be supporting both aging parents and growing children.

This need for budgeting increases as many are still paying student loans, which are set to resume soon, and on average, these payments will eat up about 8.8% of Gen X’s income.

Although Gen X still leans into other credit products, BNPL has become an important tool for bigger purchases, especially for those with a tighter budget.

Want to learn more? Check out PYMNT’s full write-up here.

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