Have you ever found yourself slipping into bad spending habits online, that you just can’t get out of? You could be experiencing financial quicksand
Money. It’s one of those taboo subjects that many of us feel uncomfortable talking about. According to one 2020 survey from the Money and Pensions Service, 29 million UK adults don’t feel comfortable talking about money, despite 48% worrying about their finances recently.
With concerns around growing inflation, and the impact of rising costs on households, there’s never been a more important time to better understand our finances – and to feel able to ask for help.
What is financial quicksand?
Popularised by Citizens Advice, the term financial quicksand is used to refer to the slippery slope of online spending. Companies influence us to make spending decisions in both deliberate and subtle ways. By introducing risky or longer-term spending commitments to us when we’re already checking out online, it can lead to financial commitments we aren’t fully considering. And by the time we realise? We’re already in too deep, spending more than we can really afford.
Financial quicksand can include different kinds of spending, such as:
By Now, Pay Later (BNPL) schemes
When you click to delay payments, or split one cost into smaller, monthly payments, you are entering into a BNPL contract. Many people find themselves agreeing to these without fully understanding what they are signing up for (e.g. the total amount of payments, interest rates, or even late fees).
More and more online retailers are offering BNPL options once you’re already trying to pay – making those ‘six easy payments’ sound much more enticing (and often just one click away).
Research undertaken by Citizens Advice reveals that one in four people regret using BNPL schemes, two in five struggle to meet repayments, and one in three miss or make late payments. Worryingly, two in five of us who have used BNPL didn’t realise it until after the sign-up process.
Apps are often easy to access, taking minutes to create an account. For those who experience gambling addiction or want to limit their spending, protections (maximum spending limits, forced breaks) can be difficult to access, or may have a delay in being applied.
Closing accounts can be tricky, whereas money can be deposited with just a single click. Many apps even accept Apple and Google Pay, meaning you don’t need to enter your card details at all. This can make tracking your spending much harder, meaning you’re more likely to fall into gambling debt.
Often offering free trials with just a couple of clicks, cancelling subscriptions can be extremely hard. You may need to directly call a customer service line, but finding the number isn’t easy through the website’s FAQs or menu, and only has limited availability. Or perhaps they have a complex chat system that requires you to jump through hoops with buggy chatbots sending you round in circles.
Many subscriptions turn into automatic payments unless you click to cancel in time, and some companies avoid using the word