Apple’s New Trick To Get You to Spend More
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What's up, guys? George Camel here, and today we're talking about America's favorite fruit-based tech company, Apple.

And as you can tell, I'm a fan. I got pretty much everything they own, every dongle they can throw at me. I'm buying it, okay? And today we're talking about a specific big announcement coming from them. And it's not the newest iPhone that's a slightly different color than the one you already have. And no, I'm not talking about some kind of cool microphone you wear on your body that sends Apple information about your conversations. That already exists. It's called Siri.

Nobody's talking to you, Siri. Well, today we're talking about a new feature from Apple called Apple Pay Later. You can probably infer from the name what this is. Apple is jumping into the buy now, pay later game with the other industry players that you've heard of like Klarna, Afterpay, Affirm, and even PayPal. Now, to be clear, Apple already has something called Apple Pay, which I actually use.

It's really convenient. It basically just lets me pay with my phone using a debit card that I have linked to the account. But Apple's rolling out a new feature for Apple Pay users that allows them to split their purchases into four payments over six weeks with zero interest and no fees. Hang on, no interest and no fees? There's gotta be a catch here. - You mean the mob only did me a favor to get something in return?

Now, you know I'm not a fan of buy now, pay later, but you might be wondering, if there's no interest or fees, what's the harm in breaking up my purchase of purple parachute pants into petite payments? Well, let's dig into the dirty details and find out if Apple Pay Later is the best way to buy those big old baggy britches. Was that too much alliteration? Did we go a little hard? Felt like a lot. Before we jump in, do me a favor and click that like and subscribe button. It's completely free, no interest, no fees. It won't cost you a thing. Well...

Maybe like one second of your time and a little bit of your energy to move your finger and press down a little. But other than that, completely free. Here's how Apple Pay Later works. Users would first need to apply for a loan within the Wallet app. This loan amount ranges from 50 bucks all the way up to a thousand bucks. Then Apple does what they call a soft credit check. And if the user is approved, they can start using the Pay Later feature, which allows them to split their purchase into four payments over six weeks. But did you catch a little word in there that I mentioned? That's right.

It's a trap. And it's so easy, it's scary. This is called frictionless spending, convenient payment options. And this causes some bad things down the road. That means you could literally take out a loan to pay for those marshmallow mateys or those far out fruities or those cocoa puffs. And 42 days later, you're still paying for cocoa puffs. And that, my friend, is cuckoo.

Yahoo! I'm cuckoo for cuckoo pups! And by the way, just because Apple isn't charging you fees doesn't mean that you won't be paying any. Have you ever heard of a thing called overdraft? Yeah, that applies here. You see, Apple's genius. Their pay later purchases have to be made with a linked debit card.

you can't do this with a credit card. So when all those payments hit on all those different days and that money's not sitting in your checking account, you get hit with a non-sufficient funds fee. See, these fees accounted for over $15 billion in revenue for banks in 2019. But here's the genius of Apple. They get to wash their hands of this and remain the good guys. They're the good cops here and the banks

get to be the bad cop because they're the ones who will charge you those overdraft fees. Apple's vice president of Apple Pay and Apple Wallet, Jennifer Bailey, said, Apple Pay Later was designed with our users' financial health in mind.

Jennifer, thank you. That's so nice. Thank you for caring about me and my financial health. So much that you would go through all the trouble of making this new feature that lets me buy things I can't really afford, keeps me in your payment ecosystem, and likely causes me to spend more, all while making you oodles of money. Thanks, Jennifer. That's right. I said it, Apple. Maybe you had a little more in mind than just my financial health. Like, I don't know, dollar signs? Shareholder value? Look,

There's nothing wrong with offering a service and making money. I'm not mad about that. But what really grinds my gears here is the way Apple is pitching this as some kind of financial tool to help people. You see, this whole buy now, pay later trend is not just a free service Big Tech is generously providing to help you out. It's got to make money for them in order to be sustainable. That's kind of how business works. So if there's no fees or interest,

Apple Pay.

to generate around $4 billion of revenue in 2023. So Apple Pay is a huge source of revenue for Apple. Now enter the buy now pay later companies like Affirm and Klarna. Well, Apple doesn't want all those Apple Pay users jumping over to use those other services because then they don't get a cut.

So Apple introduces Apple Pay Later, hoping that it will keep people in that payment ecosystem to ensure they're getting their little piece of the pie. And by the way, this is just one part of Apple's financial ecosystem. And you've probably seen this news from Apple just recently. The company just launched their Apple Card Savings account with a high-yield APY, 4.15%. But...

Of course, there's a catch. You can only open that savings account if you already have the Apple credit card. Now, if you know me, you know I wouldn't touch credit cards or Grinches with a 39 and a half foot pole. And what Apple's press releases don't mention is the sneaky little side effect of introducing their own buy now, pay later service. Their users will likely spend more money than they would have.

And that means Apple makes even more money. So how do I know this? This feels like a wild assumption. Well, I didn't make this stuff up. In fact, Klarna, who's another player in the Buy Now, Pay Later space, they did the research for us. And right there on their website, they are bragging to businesses that offering Klarna as a payment option will increase the average store order by 45%. So even if we now know that Apple Pay Later is not the best way to pay, you might be wondering, well, how am I supposed to buy this autographed Matt Damon Funko Pop if I can't break it up into smaller payments?

and spread it out over several weeks. Well, I've got one word for you, and it's not Apple. It's cash. That's right. Here's a concept. Wait until you have enough money saved up and do a little thing I like to call buy now, pay now. How's that? Use your debit card or go old school and just write a check or actually pay with real cash like your grandma did back in the day when she bought her first Funko Pop.

Now, before you jump in the comments and be all, "But George, that's so old-fashioned. Get with the times, bro." Listen to me, bro. Even when the times change and new technology arises, there are some basic money principles that have withstood the test of time. And in this case, it's the principle of delayed gratification. You see, not too long ago, when people wanted to buy something they didn't have enough money for, they said, "I actually can't afford this." And then for the next six weeks, they would save up until they could finally say,

I can afford this now. Now it's all backwards. Now people say, I can afford this now. And then for the next six weeks, they say, turns out I actually can't afford this as money leaves their bank account faster than Zane left One Direction. Basically, by saving up and paying cash, you'll experience a little bit of pain on the front end instead of a whole lot of pain on the back end.

And if that's you right now with a pile of debt, pay it off. I will drop a link below to show you the plan that I used to get out of debt 10 years ago. Now, if your pain in the back end is physical, they got creams for that. Not gonna drop a link, but Google it.

No, I don't think I will. So even though Apple Pay Later might seem harmless at first with no interest and no fees and all of the slick marketing, you got to remember that any buy now pay later service will cause you to spend more, up to 45% more, and it can come back to bite you even without those interest and fees. And think about this. Apple is a huge tech company. They know what they're doing. They wouldn't offer this if they weren't expecting it to be profitable. And how are they making profit?

from you. So look, times are tough for a lot of people. And if you're in a spot where money's been so tight that you've resorted to these buy now, pay later schemes and apps and services, there's no shame here. But you gotta stop. You gotta stop borrowing money. That's what this is. It's debt by another name. Get rid of those pesky little loans

and get on a budget and save for things in cash with intentionality instead of impulse. The sooner you do, the sooner you can stop living paycheck to paycheck and finally get a little margin in your life. And you will be so glad that you did. The budgeting app that I love to use is called EveryDollar. It's free and I'll drop a link below if you want to get started. Hope you guys found this video helpful. Don't forget to like and subscribe to get more stuff like this and be sure to share it with your friends.

Especially Becky, because you know she used Afterpay for that 400-ounce Stanley tumbler because they just released the new orchid color, and it's just so spring. We love it. Thank you guys for watching. We'll see you next time.