The return of the layaway purchase

Filed under: In The News, Shopping

walletBack in the day, before we all went crazy with our credit cards, there was another popular way of buying something you couldn't afford. It was called a layaway and it was a very good thing.

For those of you unfamiliar with the layaway process, let me explain. You find a pair of fabulous shoes at your favorite store that you just have to have. Unfortunately, you don't actually have enough money to buy them. Instead of charging it on your credit card, you pay the store a small fee to hold them for you while you make payments directly to the store. When you've paid them off, the shoes are yours. If for some reason you fail to pay them off in the agreed upon time, the store will keep the shoes and refund your money minus a cancellation fee.

Buying on layaway was the way to go back in the Great Depression and thanks to our current economic woes, it is becoming popular again. Wal-Mart stopped doing layaways a few years ago, but many other stores still offer the service -- my personal favorites, TX Maxx and Marshall's, among them.

The advantage to buying on layaway is obvious. The fee you pay the store to hold the item while you pay it off is usually about $5 -- a lot less than what your credit card company will charge you to pay off the same purchase. Of course, the downside for the instant-gratification crowd is that there is no instant gratification. You can't actually have that fabulous pair of shoes until you have paid for them. But maybe learning to delay gratification is a lesson worth learning -- and a good example to set for our children.

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Start by teaching him that it is safe to do so.