Layaway plans are back for the consumer just in time for holiday shopping. For those of you who missed this lovely store feature, layaway started during The Great Depression when people simply didn’t have the cash to make a purchase all at once. Layaway started to phase out during the 1980′s and by the 1990′s with stores offering their own store credit cards – and making millions – allowing consumers to overspend, the cost of offering layaway simply became cement boots to retailers. After all, you can’t make more money off of layaway, you can’t “count” the purchase until it is fully made for quarterly sales numbers and most of all…people tend to be more prudent in shopping.
What is layaway? It’s putting money down on items at the store that are then saved for you in the storeroom allowing you to make payments over time. Interest isn’t charged but some stores do charge a nominal layaway fee ($5).
With consumer credit and wallets tightening and holiday shopping around the corner, layaway looks to be a popular option. Get the items you want now – ok, put on hold for you now – and pay in bits at the store until the balance is paid in-full. Once paid in-full, you take the items home with you.
Tips for buying on layaway:
- Get a copy of the store’s layaway policies and staple it to your receipt
- Make sure you understand the policies such as maximum time between payments / schedule of payments, late fee policies, refund and exchange policies, markdowns on sale prices, loss or damage of items while in the layaway room
- Be realistic in what you can afford over time and what you put on layaway
- Keep clear and accurate records of payments made (staple them to the original receipt and layaway policy statement signed) in case you have disputes later.
- When going to the store to make a payment use the direct in-out method. Walk into the store and directly to the layaway counter to make the payment and then walk out and get back into your car. Do not browse, sample, sniff, touch… in and out. Once you are back in the car the chances of going back into the store to shop greatly decrease.
Don’t forget that until you payoff the items in layaway the store has your money and merchandise. If the store goes out of business while you’re still paying you could be out both the cash and goods so only deal with reputable businesses.
Stores such as Walmart did away with layaway years ago but Kmart kept this feature of frugality. Kmart, Burlington Coat Factory, TJ Maxx and Marshall’s have layaway plans. If you know of other stores that have layaway service plans – let us know in the comment field!