The “Funflation” Factor: How Concert Costs Are Driving a BNPL Boom – and What It Means for Your Wallet
Nearly a quarter of Americans have now used “buy now, pay later” (BNPL) services to finance concert or festival tickets, a figure that jumps to over a third for Gen Z and Millennials. This isn’t just about convenience; it’s a symptom of a larger trend – what economists are calling “funflation” – where the cost of experiences, particularly live events, is rising dramatically, forcing consumers to rethink how they budget for leisure.
The Rising Cost of a Night Out
The days of affordable concert tickets are increasingly a memory. Tours from global superstars like Taylor Swift, Beyoncé, and Coldplay have demonstrably driven up prices across the live event industry. According to the Bureau of Labor Statistics, admission fees to movies, theaters, and concerts rose 3.9% in the year leading up to June 2023. While recent FTC rule changes aim to increase ticket pricing transparency, experts caution that these measures won’t necessarily translate to lower costs.
What’s Fueling Funflation?
Several factors contribute to this trend. Increased demand post-pandemic is a major driver, as people prioritize experiences after periods of restriction. However, production costs have also risen, and artists are commanding higher fees. Dynamic pricing – where ticket prices fluctuate based on demand – further exacerbates the issue, often leaving fans feeling priced out. This is compounded by the fact that the live entertainment industry is increasingly concentrated, giving fewer players more control over pricing.
BNPL: A Double-Edged Sword for Concertgoers
The appeal of BNPL is clear: it allows consumers to spread the cost of expensive tickets over manageable installments, often without immediate interest. However, not all BNPL plans are created equal. While some offer genuinely interest-free options, others come with Annual Percentage Rates (APRs) as high as 36%, according to NerdWallet. Late fees and charges for rescheduled events can also add up quickly, potentially costing up to 25% of the original purchase value.
“Paying with a credit card can make it easier to get your money back if the concert gets canceled,” explains Greg McBride, chief financial analyst at Bankrate. Credit cards also often offer purchase protections that BNPL plans typically lack. Furthermore, approximately 65% of concertgoers plan to leverage credit card rewards – like cash back or points – to offset costs, a benefit unavailable with most BNPL services.
Generational Divide: Why Younger Consumers Lead the BNPL Charge
The LendingTree survey reveals a significant generational gap in BNPL usage. While 23% of all respondents have used BNPL for concert tickets, that number climbs to 37% for Gen Z and 35% for Millennials. This isn’t surprising, as these generations are more digitally native and comfortable with alternative payment methods.
Matt Schulz, chief credit analyst at LendingTree, notes that BNPL aligns with the “time of life” for younger Americans. “Part of the reason why I ended up in credit card debt in my 20s was because I was going to concerts and seeing my favorite bands,” he admits. This suggests a pattern of prioritizing experiences and utilizing flexible payment options to make them accessible.
Beyond BNPL: Proactive Financial Strategies for Live Event Fans
While BNPL can be a temporary solution, a more sustainable approach involves proactive financial planning. Schulz recommends creating dedicated savings funds – a “Beyoncé fund” or a “Taylor Swift fund” – to earmark money specifically for concerts and festivals. This encourages disciplined saving and avoids reliance on debt.
The Future of Live Event Financing
We can expect to see continued innovation in how live events are financed. Subscription models offering access to a range of events for a fixed monthly fee could gain traction. We might also see more partnerships between event organizers and financial institutions offering specialized financing options. However, the core issue of rising ticket prices remains.
The increasing popularity of resale markets, while offering some consumers opportunities to find deals, also contributes to price volatility and potential scams. Greater regulation of these platforms may be necessary to protect consumers. Ultimately, the onus is on both consumers and the industry to address the challenges of “funflation” and ensure that live events remain accessible to a broad audience.
What strategies are you using to manage the rising cost of live entertainment? Share your tips and experiences in the comments below!
