You’re on Costco.com, looking at a $1,200 TV. Too bad you don’t have $1,200 to spend on a TV. Then you see it at checkout: Pay over time.
Twelve easy payments. Maybe 24. Suddenly that TV costs less than your cable bill.
Here’s the problem. “Pay over time” is a loan. Sometimes it’s a free loan, and sometimes it’s one of the most expensive loans you’ll ever take out. The checkout screen won’t make the difference obvious, so I will.
I’ve been a CPA since 1981, and I spent 10 years on Wall Street before I started Money Talks News. I’ve watched a lot of financial products get dressed up to look like something they’re not. This one is a classic.
Here’s what you need to know before you click.
1. What Costco and Sam’s Club offer
On Oct. 22, Affirm announced a multiyear deal making it the only pay-over-time option at Sam’s Club. It will apply to eligible purchases of at least $500 on SamsClub.com. Affirm says it plans to bring the option into Sam’s Club warehouses in 2027.
Costco got there first. Since May 2025, Costco members who shop on the website have been able to choose Affirm when they pay for orders between $500 and $17,500, according to Affirm’s announcement. That’s Costco.com, not the warehouse.
Two fine-print details matter. You have to pass an eligibility check, and Affirm says you may have to put some money down, depending on how much you’re buying.
(If you’re weighing a Sam’s Club membership for the first time, check out Walmart Now Throws in Sam’s Club for $120. Here’s Who Should Skip It.)
2. Zero percent and 36% look exactly alike at checkout
Affirm says your rate will be anywhere from 0% to 36% APR, based on your credit. The company also offers Pay in 4, which splits a purchase into four payments at 0% APR.
Read that range again. Zero to 36. Same button, same store, same TV.
Affirm makes a point of saying it never charges late fees and its interest never compounds. Most credit cards do both, so that’s a real point in Affirm’s favor.
But “no late fees” isn’t the same as “no cost.” The cost is the interest rate, and it’s set by your credit, not by the friendly checkout screen.
So before you agree to anything, find one number on that screen: the APR. If it’s zero, great. If it isn’t, keep reading.
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3. The math: what that $1,200 TV really costs
Let’s put the TV on a payment plan and do the arithmetic. I’m assuming no down payment and equal monthly payments, the way any installment loan works.
Paid off over 12 months:
- At 0%: $100 a month, $0 in interest.
- At 15%: $108.31 a month, about $100 in interest.
- At 36%: $120.55 a month, about $247 in interest.
Paid off over 24 months:
- At 0%: $50 a month, $0 in interest.
- At 15%: $58.18 a month, about $196 in interest.
- At 36%: $70.86 a month, about $501 in interest.
Look at that last line. At the top of the range, stretching it to two years means you pay more than $1,700 for a $1,200 TV. That’s a markup of nearly 42% on a product you went to a warehouse club to buy cheap.
And notice what the longer term does. It lowers the monthly payment, which is exactly what makes it feel affordable. It also doubles the interest.
4. When paying over time beats a credit card, and when it doesn’t
For comparison, the Federal Reserve reports that credit cards charged an average of 22.36% in the third quarter of 2026.
Put that same $1,200 on an average card and pay it off in equal installments, and you’d pay about $150 in interest over 12 months or about $299 over 24.
So here’s the rule of thumb:
- If Affirm offers you 0%, it beats any card that charges interest. Take it and pay on time.
- If it offers something well below your card’s rate, it can be the cheaper loan.
- If it offers something near 36%, it’s worse than the average credit card. Walk away.
There’s a fourth option many people forget: a card with a 0% introductory rate on purchases. If you’ve got good credit, you can compare cards here and see whether one would let you spread out a big purchase for free.
And the best option of all is still the oldest one. If you can wait a few months and save the cash, the TV costs exactly what the price tag says.
5. Three questions to ask before you click
Will it show up on my credit? Affirm says it reports repayment activity to the credit bureaus, though it also says neither FICO nor VantageScore counts that data in its scores yet.
FICO has built versions of its score that include pay-over-time loans, which it said would be offered to lenders alongside its existing scores as of fall 2025. Assume these loans will count more over time, not less.
What happens if I return it? Before you buy, find out how a return works when the purchase is financed. Know whether the refund goes back to the loan and whether any interest you’ve paid comes back too.
What protections do I have? In 2024, the Consumer Financial Protection Bureau tried to treat pay-over-time lenders like credit card companies, including the right to dispute charges.
On May 12, 2025, the CFPB withdrew that rule. So don’t count on Washington to hand you card-style dispute rights. Read the lender’s own dispute and refund policies before you buy.
The bottom line
Pay-over-time isn’t evil. At 0%, it’s a free loan, and I’d never tell you to turn down free money.
But the warehouse clubs built their reputations on one promise: You pay less here. A 36% loan breaks that promise.
Before you click, find the APR, run it through the math above, and decide whether the TV is still a bargain.
If you’re already carrying card balances, don’t add a new loan on top of them.
See the options laid out for a retired couple in exactly that spot in “We’re 67 and Owe $28,000 on Credit Cards,” and if you need help getting out from under, here’s a place to look at your options for dealing with debt.
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