Scenario: Pay now or pay later?

Given Ryan’s situation, which decision do you think is best for him?


Ryan’s been working to save money for school next fall. While he’s at work, his motorcycle gets clipped by a pickup and crashes over. Result: a bent foot peg, a broken lever, a smashed signal, and scratched paint. It can all be fixed, but it isn’t in his budget, unless he pays some bills late. He needs his motorcycle to get to work and school. Given his circumstances and these three choices, how would you advise him to pay?
Use his debit card and pay his other bills late. He needs to get to work and not take on debt.

The consequences of your choice

See the consequences of this choice for Ryan and hear what your guide has to say.


“This advice just didn’t work out. I got my bike fixed, but ran myself short on cash. Because I paid a few bills late, I had to pay late fees and hurt my credit rating, too. I’m still scrambling to catch up, money-wise. I think I should have used my credit card and paid it back over time instead. That would have meant paying some interest, but the overall cost would have been less than I paid this way.”
Use his credit card so he can get it fixed fast, keep working, and earn the money to pay it back.

The consequences of your choice

See the consequences of this choice for Ryan and hear what your guide has to say.


“I’m really careful about borrowing money, but I think this was a good time to do it. I figured out in advance how quickly I could pay off my credit card balance so that I could still pay my other bills on time and minimize the interest I paid. I also didn’t have to dip into my savings that I’ve been working so hard to build up. Plus I got my bike back right away and didn’t miss work.”
Use the money he’s saved so far. Savings are for unexpected emergencies like this.

The consequences of your choice

See the consequences of this choice for Ryan and hear what your guide has to say.


“This didn’t work out like I hoped. I thought it would be better to avoid borrowing money. I got my bike fixed, but then I had real emergency: I hurt my arm and couldn’t work for four weeks. I didn’t have time to build my savings back up before school started, so I started using my credit card for stuff like concerts. I think it would have been better to use my card just for the bike and pay it off as quickly as I could.”
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Consider your options when it's time to pay. You might want to use cash, credit, or savings – or some combination of these. How will your choice affect your overall spending plan?
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