But we can put the rose coloured glasses away now just to look at what can go wrong – Remember there’s no such thing as a free lunch!
Disadvantages of Layaway
There’s little doubt layaway schemes are convenient for a great many people and affordable. But here’s another catch – they aren’t always free! Surprised?
We thought not! Some stores may actually charge you a nominal fee just to kick start the process. They might also sting you with a fee if you make a late payment or fail to pay off the goods fully.
We mentioned credit cards in article one and some stores will let you pay with a credit card – but of course this will make the item a lot more expensive suddenly, so you must weigh all of this up!
There are limits
Retailers aren’t altogether stupid and of course some goods simply won’t be available on Layaway. These will probably include computers, food and liquids. There’s also one little concern that if the store closes down due to bankruptcy, consumers may well lose their money. Though we shouldn’t think this will happen with Wal-Mart, so stick with the big names if you can!
You’re probably wondering why Layaway schemes died out and you may not know they actually kept going until the 1980’s. Credit cards came thundering onto the scene and with the advent of modern technology consumers wanted to have things right now! Stores didn’t want the added costs of handling the goods and storing the merchandise. This was the advent of store branded credit cards, so the layaway system was taken away but not altogether! Credit cards will still actually quite new for many Americans at this time. Oh and E.T paid us a visit!
So what can we learn from all of this?
Layaway was put into storage by many stores in the 80’s and 90’s as the plastic became fantastic, and the 20th century entered a new era. But in 2008 the economic crisis really hit American families hard and retailers were suddenly forced to think of something new to keep their heads above water. In fact some stores began to specialise in layaway. We’ve mentioned the system can teach people budgeting skills, and even help them with their savings plans. So all of this has to be good fiscally! The fact is it teaches us all we can’t expect to take goods away unless we can afford to pay for them in full. Instant gratification can also get us into financial trouble very easily. We begin to learn the true value of things and that credit cards shouldn’t really be used to pay for goods in this way. We need to pay full attention to the fees stores can introduce and what the small print contains at the bottom of the agreement. We have to choose what we buy wisely and be sure we can meet the regular payments.
So what’s the rub?
Well the upshot is Layaway plans are financial tools that when used correctly can benefit us greatly without getting us into debt. But they need careful planning and much discipline to make them work fully! The old fashioned values can shine through and help us with our financial commitments. Layaway plans are actually quite ingenious and nothing to be ashamed of. They can be used by people from all walks of life……..God bless America! Layaway is the future!