iPhone Instalments: Wise Choice Or Cheese Trap?

Powerful Apple Intelligence, sleek yet durable design, and amazingly high-quality cutting-edge cameras – these are just some of the reasons that make the iPhone 16 the ultimate tech gadget. Of course, while it looks like the ultimate tech trophy, it’s also a financial mousetrap. 

The cheapest of the iPhone 16 series, the iPhone 16e, is priced at RM2,999, and the most expensive of the iPhone 16 series, the iPhone 16 Pro Max, climbs to a peak price of RM7,999. In Malaysia, the cost of the cheapest iPhone is nearly 80% more than the minimum wage (RM1,700!), so how then can an average Malaysian afford such an expensive gadget?

The idea of “buy now, pay later” has never been more tempting, especially when retailers like Apple dangle bite-sized monthly payments in front of passionate iPhone fans. But, just like a cheese trap, the delicious cheese comes first, and the dire consequence follows. 

So, why are more Malaysians still falling for this shiny cheese trap? 

What’s the trap?

Have you ever wondered? How is it possible that your co-worker or your classmate is able to pull out a phone that’s worth more than three months of their salary or allowances? That’s because Apple dangle a very attractive 0% interest payment plan that can last from 6 months, 12 months, to 24 months. 

That means, an iPhone 16 Pro Max that costs RM7,999 in a typical one-off payment, can now only set you back RM333.29 per month for 24 months!  Very tempting, isn’t it? 

When does the cheese get smelly?

Just last year, a Facebook post went viral in Malaysia when a customer earning close to the nation’s minimum wage wanted a five-year instalment payment plan to purchase his iPhone 15 Pro Max. Thankfully for the customer, the seller denied the request as he was worried about the risk that comes with purchasing a high-ticket item when one does not have the financial capability to do so. 

If he went through with it, a huge chunk of his monthly salary would have been spent on purchasing the phone. In the unfortunate event that he lost his job or fell ill, there won’t be any funds left for him, potentially leaving him with much financial stress. 

It can even ruin your credit score!

Unlike your situationships, there are strings attached to these instalment plans (no offence though), and it usually involves your credit score. Even though many of these plans offer “zero interest”, it’s always important to read the fine print that comes with these plans. 

Some of these plans may include insurance charges, processing fees or even penalties for late or missed payments. Missing even a single payment will show up on your credit report and decrease your credit score. A poor credit score will eventually make it harder for you to apply for other financial plans, including a loan for a house or car, or perhaps even another instalment plan. 

What else can you do then?

Don’t be frightened by the few black sheep in the herd. There are still plans that exist that aren’t traps. CompAsia’s ReNewNGo offers a new subscription model that is flexible and allows you to upgrade or return your phone after 12 months or own it after 36 months. 

Retailers like AEON Credit and Senheng are also very transparent about the payment amount, so you won’t have to worry about being caught off-guard. Nonetheless, while these are tempting, you should also see if this financial commitment is justifiable. 

How to decide if you can really afford it?

• Is this a want or a need? If your current phone is still functioning, then purchasing a new iPhone can probably wait. 
• Will the monthly payments be a financial burden? If you have to rely on your next paycheck to afford your monthly payments, then it is probably a financial burden. You should be able to afford the monthly payments for the duration of the plan. 
• If you lose your job, can you still make the monthly payments? If not, the instalment doesn’t fit your budget. 

Don’t fall into the trap!

The new iPhone is definitely one that presents a lot of attractive features that can be very enticing. But you should prioritise your financial peace of mind. While the instalment plans can be effective in helping you manage your finances, they should not be taken as a free pass to a luxury lifestyle you simply cannot afford. 

Remember, the cheese might be tasty, but it’s definitely not worth being caught in the trap!