Store layaway makes a comeback
Posted
Oct 27 2008, 07:36 PM
by
Karen Datko
Rating:
The old-fashioned way of buying things when you didn't have enough cash or credit is back in vogue in time for the holidays. It's good old layaway -- which first gained popularity during the Great Depression.
It's getting so much attention that a Wall Street Journal blog, The Wallet, is asking if it's the "new credit card." Elizabeth Warren at Credit Slips wrote, "If we needed evidence of the constriction of consumer credit, here it is."
Kmart, one of the few retail chains that didn't do away with layaway -- Wal-Mart dropped it in 2006 -- is heavily promoting it as a way to make the holiday season affordable. Pay the greater of $15 in fees or a 10% down payment, and they'll hold the item for you while you pay it off in biweekly payments over eight weeks. If you can't pay what you owe, you'll lose the fees but get a refund.
"What a fantastic idea!" chirped "Boomie" at The Wastrel Show. (Trust us. This is tongue-in-cheek.) "Buying a product and paying cash for it before you take possession."
Of course, The Wastrel Show noted, you can find layaway online. For instance, eLayaway charges a fee of 1.9% of the purchase price to have money automatically deducted from your bank account for up to 13 months to pay off your purchase. There's also Lay-Away.com.
You can pay for a vacation on layaway at LayAway-Travel.com, and Baby's Adobe has a cloth diaper layaway plan, Boomie said. (We read elsewhere today that people are leaving their kids in diapers longer because they're cheaper than training pants.)
Boomie even predicted a resurgence of interest in Christmas clubs.
"So, relax everybody," Boomie said. "We will still be able to buy whatever we want, for cash, without using a credit card. Ain't life grand?"
Some people commented at various blogs about an even better idea. Why not save your money, avoid any fees, and then shop around to make sure you're getting the best price?
