Pay-As-You-Go is a Great Way to Go

CashIt’s not easy being a consumer these days. In fact, it can be downright confusing because of all the payment choices. First, you have your cash, your checkbook, credit and debit cards. And then you have deferred billing, skip-a-payment, nothing down, no payments and/or zero interest till the next decade. See? Confusion, pure and simple.
Prehistoric consumers had it easy. Just one choice: chickens. They traded poultry for things they needed. The rules were simple: No fowl? No food, fuel, fun or futons for that matter.
Then, along came the invention of currency and that gave consumers a second choice — one that caught on quickly, since folding a chicken to fit neatly into one’s wallet was rather messy.
A third option was both the day some unknown retailer came up with a payment plan, surely named in memory of the good ol’ chicken days: Layaway. You may be wondering what happened to layaway, anyway!
Not that long ago, every major retail store in the country allowed customers to buy merchandise on layaway. The item was placed in the back room and customers could take all the time they needed to pay it off … interest free. And when they made the last payment, they took the item home.
Layaway was simpler, and more upfront than credit card purchasing; There was a start and a finish. There was delayed gratification as well as a sense of responsibility and anticipation. With layaway, there were no surprises.

Without much notice, layaway programs started to disappear in the 1980s. Jumping on the consumer credit bandwagon, retailers convinced consumers it was better to take everything home right away, avoid those annoying progress payments and then commence to pay for the next 15 or 20 years. Retailers did such a good job of convincing that layaway plans all but disappeared.
You’ll be happy to know that a good number of your favorite national chain stores have reintroduced layaway:

??? –Toys R Us/Babies R Us

??? –GameStop

??? –Kmart

??? –Sears

??? –Walmart

??? –Burlington Coat Factory/Baby Depot

??? –Marshalls

??? –T.J. Maxx

??? –eLayaway (Online only)
While cash up front will always be the best choice, in your columnist’s humble opinion, making payments on layaway is much better than making payments on a credit card account because:
1. The store keeps the items until they are paid in full. No debt is incurred.

2. There are no interest charges, although some stores have a small layaway service fee and a restocking fee if you cancel.
3. Typically, the customer is protected if the item goes on sale during the layaway period and the price of the time is reduced accordingly.
4. There is no legal obligation. If you change your mind, you get a refund.
To avoid misunderstandings, get specific information about a store’s layaway terms before you participate. Ask for a written description of the store’s plan and read it before you agree to a layaway purchase.

No matter how you choose to do your gift shopping in the coming year, make sure you start early. And pay as you go with cash or layaway, which remains just slightly more convenient than chickens.

(Source: TNS)