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Old 12-08-2018, 11:00 PM
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Whack-a-Mole Whack-a-Mole is offline
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What is the point of a "layaway" purchase at a store?

I saw a headline that Kid Rock paid off $81,000 of layaway plans at a Nashville Walmart store.

Very nice of him but I am curious why anyone would do a layaway?

Why give the store monthly payments for a future purchase? Why not keep the money yourself, invest it or at least earn interest, and then buy the item once you have enough money to do so?

What am I missing?
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Old 12-08-2018, 11:06 PM
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Very nice of him but I am curious why anyone would do a layaway?

Why give the store monthly payments for a future purchase? Why not keep the money yourself, invest it or at least earn interest, and then buy the item once you have enough money to do so?

What am I missing?
I think it's for people who aren't any good at saving money. If it is in the checking account, it'll get spent on something else (either critical or frivolous). The layaway becomes a current bill, so they are more likely to pay it off.

Do stores that provide layaway do any sort of interest charges? If you miss a payment (or a bunch), do you lose both the payments and the article?
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Old 12-08-2018, 11:12 PM
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Maybe to insure they get the newest most coveted this-years toy. I knew a person who used layaway to keep her kids from snooping and finding their toys. But mostly to pay it off a bit at a time. I think.
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Old 12-08-2018, 11:17 PM
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I've only ever seen layaway for items that are currently out of stock at a store. You pay them in advance, and in return, when they get more in at the next shipment, they'll set one aside for you to guarantee that you get one.
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Old 12-08-2018, 11:18 PM
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What am I missing?
Hedge bet against the item you want being available, or maybe hoping some rich guy pays it off.

This response heavily edited prior to posting. Been drinkin'...
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Old 12-08-2018, 11:31 PM
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Do stores that provide layaway do any sort of interest charges? If you miss a payment (or a bunch), do you lose both the payments and the article?
I really do not know but since you are not buying on credit I cannot see how they can charge interest payments. They keep the item till you pay the full amount. Perhaps they charge a fee for the service but otherwise they get your money in their accounts where they can earn interest or invest it to make more money so it works for the store.

I wonder what happens with sales and such (e.g. you have the item on layaway and are 75% paid up and then the store gives a 50% discount).
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Old 12-09-2018, 12:24 AM
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My grandma used to do K-Mart lay-away all the time despite being fairly well-off. My only guess being that must have some promotion for doing lay-aways like getting a free gift card or something, no other reason why my grandmother would wait a month to get a television if she could afford to pay it off immediately.
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Old 12-09-2018, 12:27 AM
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Something sort-of related that used to be a thing was the Christmas Club. In this, you deposit a certain amount each week in a special account and then the bank gives you the accumulated balance in time for the Christmas shopping season.

Like lay-away, this may not make any sense to those not living paycheck-to-paycheck. But for those who are, both are ways to pay for stuff.
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Old 12-09-2018, 12:28 AM
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I've only ever seen layaway for items that are currently out of stock at a store. You pay them in advance, and in return, when they get more in at the next shipment, they'll set one aside for you to guarantee that you get one.
Edit: Rainchecks don't require payment up front, so I guess what you described is a layaway.

Last edited by lingyi; 12-09-2018 at 12:31 AM.
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Old 12-09-2018, 12:30 AM
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I haven't used layaway for many years, but when I did it was because a) I wouldn't have the full price for another paycheck or two, b) I was afraid they'd be out of stock when I did have all of it, and c) I didn't have any credit cards.
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Old 12-09-2018, 12:36 AM
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I don't think people with investments or accounts that earn a meaningful amount of interest are really in the target market for layaway.

It's much less common for stores to offer it than it used to be. The fact that Walmart, which offers a lot of services aimed at the lower end of the financial spectrum, can't find any value in offering layaway outside of the Christmas season means there probably isn't a huge market for it.

Last edited by Lord Feldon; 12-09-2018 at 12:40 AM.
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Old 12-09-2018, 12:41 AM
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When I was a kid, my family used it all the time, usually for school clothes, and also at Christmastime, probably as yet another way to hide the goodies from prying little eyes.

My state has a tax-free weekend in August, and when we still had Kmart here, one of my friends would take her kids there a couple weeks ahead of time, let them pick the things they wanted, put them on layaway, and then get them out on TFW and get about an 8% discount. (Clever!)
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Old 12-09-2018, 12:45 AM
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Something sort-of related that used to be a thing was the Christmas Club. In this, you deposit a certain amount each week in a special account and then the bank gives you the accumulated balance in time for the Christmas shopping season.

Like lay-away, this may not make any sense to those not living paycheck-to-paycheck. But for those who are, both are ways to pay for stuff.
This. Not everyone puts their money in the bank. I know people who cash their paychecks at Walmart and keep the cash at home and keep spending it as long as there's cash with no clue how much is left. Layaway is a way to be sure they can buy something they want since they keep making weekly or monthly payments.

As for why the stores do it, it's free cash for them if someone cancels. From Walmart's layaway policy:

"Cancellation - If your Layaway account is canceled, items will be returned to inventory. Any down-payment and payments made will be refunded, less a $10 cancellation fee. Cancellation fee does not apply in Maryland, Ohio, Rhode Island or Washington, D.C."
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Old 12-09-2018, 12:46 AM
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It's a way of paying off a purchase without incurring any interest.
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Old 12-09-2018, 01:07 AM
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I still do a Christmas club at the credit union. They give you no interest, but you get premiums ( gifts) and on the day you've paid in all you want and it's time to get your money out (late Nov.) They have a party and freebies, plus drawings for gifts. I won a $100 gift card this year. Fun stuff.

Last edited by Beckdawrek; 12-09-2018 at 01:07 AM.
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Old 12-09-2018, 01:46 AM
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When I started working, I was paid in cash weekly, and although almost everyone who owned a house had a bank account, there were still working-class people who paid their rent in cash -- as I did for many years in cheap housing.

When I started working, banks only operated in banking hours, and even though there were branches everywhere, they mostly were not in industrial locations.

When I started working, layaway was still common, though even then not nearly as popular as it had once been.

Last edited by Melbourne; 12-09-2018 at 01:46 AM.
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Old 12-09-2018, 02:02 AM
Francis Vaughan Francis Vaughan is offline
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Here in Oz they get called a layby, and they are tightly regulated. But they do make sense. The most important point is that you are contracting to buy a particular extant item. The store is required to put the item away, and will give it to you when it is paid off. (Here in South Australia at least it is illegal for a store to enter into a layby and not have the specific item kept for the customer.) As mentioned above, great for people that have difficulty saving, but it also acts as a form of term buying where you don't need any sort of credit, and the store takes no risk. So people with no, or very poor credit rating can work out a way to buy something over time. But the reason it still works is that items on sale can often be bought on layby. So you lock in the sale price, pay off in time, and don't need a credit card or credit rating to do so.
If you fail to meet payments, the contract will have appropriate clauses. But since you are not in default on credit, you usually simply don't get to buy the item and probably lose a surcharge. A shop will not get to simply walk with your payments so far. In reality most shops are pretty loose with the terms, and are happy so long as something is being paid.

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Old 12-09-2018, 02:15 AM
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Originally Posted by Whack-a-Mole View Post
Very nice of him but I am curious why anyone would do a layaway?

Why give the store monthly payments for a future purchase? Why not keep the money yourself, invest it or at least earn interest, and then buy the item once you have enough money to do so?

What am I missing?
It seems odd nowadays that layaway still exists (I believe most stores no longer have this option). But before credit cards, it was a common purchase tactic.

As a teenager in high school, I remember using it to buy a $150 Minolta 35mm camera that I really wanted. I paid $10 on the account whenever I could -- every few weeks -- until it was paid off. That way I was assured that the camera wouldn't be sold to someone else. No one in my family had a credit card at the time. I'm not sure, but I don't think interest was charged and there must have been a finite time the store would hold it.
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Old 12-09-2018, 03:14 AM
Tim@T-Bonham.net Tim@T-Bonham.net is offline
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It's much less common for stores to offer it than it used to be. The fact that Walmart, which offers a lot of services aimed at the lower end of the financial spectrum, can't find any value in offering layaway outside of the Christmas season means there probably isn't a huge market for it.
They weree much more common back when credit cards were something only upper-middle class & above had. Most working class people couldn't even get a credit card, even if they wanted one.

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It's a way of paying off a purchase without incurring any interest.
Not really. By giving your money to the store, they are earning interest that you have foregone -- if you had instead kept that money in a bank account, you would be earning interest on it, so it is a net loss for you.

However, most people who use layaway aren't likely to have much of interest-bearing accounts. Just not being hit with interest pr fees is a rarity for them.
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Old 12-09-2018, 03:27 AM
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Not really. By giving your money to the store, they are earning interest that you have foregone -- if you had instead kept that money in a bank account, you would be earning interest on it, so it is a net loss for you.
Yes, but even if someone has the ability to earn interest, I don't think the typical layaway agreement is for so much money or time that the possible interest would amount to more than a few cents.

Last edited by Lord Feldon; 12-09-2018 at 03:29 AM.
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Old 12-09-2018, 03:32 AM
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Using layaway can be a hedge against a change in price during the months it's held. If it goes up, you pay the lower price. If something goes on sale for $20 less, even if you pay the $10 Walmart charge for cancelling the layaway, you're still $10 ahead.
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Old 12-09-2018, 03:43 AM
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Yes, but even if someone has the ability to earn interest, I don't think the typical layaway agreement is for so much money or time that the possible interest would amount to more than a few cents.
This. Let's be honest, people that have enough money to put in the bank to earn more than a few cents or dollars in interest probably don't shop at Walmart or Kmart. I know people who have low 6 figure incomes who won't shop at Walmart or KMart.
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Old 12-09-2018, 04:03 AM
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Something sort-of related that used to be a thing was the Christmas Club. In this, you deposit a certain amount each week in a special account and then the bank gives you the accumulated balance in time for the Christmas shopping season.

Like lay-away, this may not make any sense to those not living paycheck-to-paycheck. But for those who are, both are ways to pay for stuff.
It may not even be people who live paycheck to paycheck. My parents always kept two accounts: Mom knew how much was in "her" account, but not how much in the "us" account. This is someone who will spend any money she sees as available, and not necessarily in those things in which she said she was going to*; she's incapable of saving unless the money is out of sight.

For a lot of people, putting money away into a series of pre-payments, or handing it to someone else to hide, makes better sense than keeping it at hand.

* She once asked me for a 5K loan to fix her small bathroom. Spent 1400 on a set of curtains which she and 1.SiL find gorgeous and the rest of the family can't even comprehend (1); 800 on a pair of glasses (2). The bathroom didn't get fixed until a couple years later, when Middlebro was able to find the time to do it himself. Don't ask me where did the other 2800 go.




1: seriously, what's the point of having ceiling-to-floor curtains in a wall with a gorgeous view through the window and wall-long radiator below the window, when said curtains are semi-transparent and hide the view but not the radiator?
2: Dior frames, anti-glare, the kind which change color depending on the amount of light. She'd chosen the frame without looking at the price and the salesman (who is a distant relative so it's specially important for her to "not look bad" in front of him) used the magic words "well, you can afford it, can't you?"
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Old 12-09-2018, 04:55 AM
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IVery nice of him but I am curious why anyone would do a layaway?

Why give the store monthly payments for a future purchase? Why not keep the money yourself, invest it or at least earn interest, and then buy the item once you have enough money to do so?

What am I missing?
Not everyone has "investments".

Not everyone has a bank account.

If you're concerned the item will be sold out by the time you have the money then layaway basically reserves one for you until you can pay it off.

People who have certain government benefits will have them cut off if they amass a certain about of money in a bank account. If saving up sufficient funds to purchase an item will result in your food stamps being cut off for six months (as an example) then putting that item on layaway and then making payments allows you to acquire said item without risking your benefits. For a family with kids, it may not be the cost of just one item, but the combined costs of school clothing + new winter coats/boots/etc. might total up to a problematic amount, so put the school/winter clothes on layaway in August/September and pay them off in a month or two without risking the food stamps.
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Old 12-09-2018, 06:43 AM
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If you're concerned the item will be sold out by the time you have the money then layaway basically reserves one for you until you can pay it off.
Does it really work this way?

By that I mean once you put $1 on layaway on an item do they grab that item off the floor and stick it in a corner waiting for you to pay it off?

My guess is they don't and if the item is sold off before you finish paying they just give you your money back (and probably less a fee).
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Old 12-09-2018, 07:21 AM
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Does it really work this way?

By that I mean once you put $1 on layaway on an item do they grab that item off the floor and stick it in a corner waiting for you to pay it off?

My guess is they don't and if the item is sold off before you finish paying they just give you your money back (and probably less a fee).
No, your guess is wrong: the layaway is a reservation. The item may not even be made yet when you start paying, but it's yours.

Think of it as putting money down on a house that's being built or a custom-made car, only on a smaller scale.
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Last edited by Nava; 12-09-2018 at 07:24 AM.
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Old 12-09-2018, 07:44 AM
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Does it really work this way?

By that I mean once you put $1 on layaway on an item do they grab that item off the floor and stick it in a corner waiting for you to pay it off?

My guess is they don't and if the item is sold off before you finish paying they just give you your money back (and probably less a fee).
Lol. Not even close.

The item is usually taken off the shelf by the customer. The customer then carts it over to customer service where they put it in storage.

Also, you can't just put ONE dollar down. It's usually like 10% or something.

Also, when I did layaway some 30 years ago, you put down X amount, then you had 90 days to pay it off. And if you didn't pay it off in 90 days, there would be fees that came out of whatever you already put down.

At least that was the way K-mart and Wal-Mart used to do it
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Old 12-09-2018, 07:46 AM
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Does it really work this way?

By that I mean once you put $1 on layaway on an item do they grab that item off the floor and stick it in a corner waiting for you to pay it off?
That's the whole point of the name. The storage hassle is one of the reasons why so few retailers offer it. The bookkeeping hassle is bad enough, but you also have to keep a back room full of stuff that might or might not be paid off, and might or might not be salable when the layaway period ends.

Last edited by Lord Feldon; 12-09-2018 at 07:51 AM.
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Old 12-09-2018, 08:35 AM
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I've only ever seen layaway for items that are currently out of stock at a store. You pay them in advance, and in return, when they get more in at the next shipment, they'll set one aside for you to guarantee that you get one.
That's not layaway. I don't remember what stores called it way back when, but it's similar to what would be called a "pre-sale" now, where you pay in advance before the store has gotten any stock. ( and I won't say there were no stores that called it layaway, but that was not the usual meaning)

"Layaway" involves the purchases being picked out by the customer and set aside ("laid away") by the store. The customer may have to make weekly or monthly payments, and payment in full is due at a certain time- in the case of Christmas or "back-to-school" layaways, that might be a certain date. In other cases, it might be a certain number of months from the date the items were put aside. You could not necessarily put every item on layaway- there was often a minimum price or only certain items were eligible. For example, I mostly saw layaway in stores that sold clothing and/or toys - but if a store sold clothing and toys and also auto parts, auto parts might not be eligible for layaway.

The reasons for layaway- people who put stuff on layaway don't generally have credit cards. In some cases, they won't be able to save up the full price because that extra $20 a week will get spent elsewhere if there's not a layaway bill. In other cases, it's to make sure the item will still be available in a week or two when the customer has full payment.
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Old 12-09-2018, 08:54 AM
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Christmas Clubs used to be common here. The target customers were those who were paid weekly in cash and had very little to spare for extras like Christmas presents. Fifty years ago, my sister, who hated debt, had a row of pots on her mantlepiece and shared the weekly income between the milkman, paperboy, utilities etc. She did have a savings account for emergencies, but paying a small amount every week to a store made sense, especially as the store offered discounts and other goodies as a bonus.

The whole system has now fallen into disrepute after Farepak, a savings club that encouraged people to save monthly for vouchers to spend at Christmas, failed, leaving hundreds of hapless savers out of pocket. Their system was different to the ones offered by stores, as they were essentially middlemen, collecting the money and then issuing vouchers. The story is one of serious financial mismanagement in a totally unregulated sector, where, as so often happens, it's the poorest people who lose out.

https://www.telegraph.co.uk/finance/...nightmare.html

Last edited by bob++; 12-09-2018 at 08:56 AM.
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Old 12-09-2018, 09:06 AM
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Doesn't everyone here have a least one family member that has spending issues? The one that gets $100 and wants to spend it now. Because spending is more fun than saving, no matter how frivolous.

To some of these people the layaway fits into the same mental slot as spending and not the same slot as saving. They think that they are spending the money on something they'll get later.

I don't know how common this is now but "back in the day" this was also a way for wives of abusive drunks to keep some of the money from being wasted. On payday, take some and put it into layaway. When the guy is ready for a binge, he can't demand the money back from his wife. Mrs. FtG knew people like that. Remember: it's more important to get drunk now than to have presents for your kids for Christmas.
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Old 12-09-2018, 09:40 AM
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Years ago a friend worked at KMart. She told me some layaway horror stories. Every December 23rd or 24th there would be people (usually young women) who would come in with the "final $20 payment" for their kids' xmas layaway. My friend would have to break the news that the boyfriend they'd trusted to make previous payments had never done as asked. Must have sucked to be the kids that year.
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Old 12-10-2018, 05:59 AM
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Doesn't everyone here have a least one family member that has spending issues? The one that gets $100 and wants to spend it now. Because spending is more fun than saving, no matter how frivolous.

To some of these people the layaway fits into the same mental slot as spending and not the same slot as saving. They think that they are spending the money on something they'll get later.
I had a family member who was such a knee-jerk reactionary spender they would charge stuff to their debit card even if they couldn't cover it with their balance, resulting in a $10 overdraft fee. But then they would continue to use that card still afterwards resulting in every still purchase having a $10 overdraft fee attached. Their next paycheck was immediately taken by the bank to pay for all the overdraft fees they had accumulated last pay period. Nobody could ever talk reason into them, they absolutely had to have everything right that second.
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Old 12-10-2018, 08:18 AM
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Why give the store monthly payments for a future purchase? Why not keep the money yourself, invest it or at least earn interest, and then buy the item once you have enough money to do so?
As I heard it, Kid Rock's $81K donation covered 350 layaway accounts. That means each account was worth an average of $231.

According to Walmart's layaway terms, the pay-down period is about three months.

Suppose you were instead going to pile up $231 in a savings account over a period of three months before withdrawing it to make the purchase. Savings accounts (at least the kind that don't incur a fee or require a high minimum balance) don't earn much interest, maybe 1% per year. So as a coarse estimate, an average balance of $115 for three months at 1% APR would earn...

...twenty-nine cents.

The amount of money at stake here puts it at about dead last in the list of factors that get considered when making a decision about whether to layaway or not. Those other factors - savings discipline, impact on welfare benefits, etc. - are much bigger concerns.
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Old 12-10-2018, 09:48 AM
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Basically, it's credit for those who don't have credit cards or a good credit history. If they want something that the don't have the cash for, they put it on layaway and pay the installments.

It's possible that they are independent contractors who don't have regular paydays, so they put things on layaway until the money comes in. Or they get paid on the 15th and want to make sure a particular Christmas gift is available for their kid.

Stores like it because a certain percentage of layaways are abandoned, so they get to keep the down payment. There's also usually a small fee for layaway.
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Old 12-10-2018, 10:01 AM
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Keep it even simpler: Stores like it because they make a sale. The store and the customer both want the same thing: For the customer to buy something from the store. Anything that makes it easier for that to happen is a win-win.
  #37  
Old 12-10-2018, 10:16 AM
Pinmin Pinmin is offline
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Originally Posted by lingyi View Post
This. Let's be honest, people that have enough money to put in the bank to earn more than a few cents or dollars in interest probably don't shop at Walmart or Kmart. I know people who have low 6 figure incomes who won't shop at Walmart or KMart.
That’s where you’d be wrong. I know plenty of people with low 6 figure incomes and people with 8 figure net worth who shop at Walmart. I have savings and investments that earn more than a few cents or dollars and I shop at Walmart.
  #38  
Old 12-10-2018, 10:44 AM
Tired and Cranky Tired and Cranky is offline
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Originally Posted by Whack-a-Mole View Post
I am curious why anyone would do a layaway?

Why give the store monthly payments for a future purchase? Why not keep the money yourself, invest it or at least earn interest, and then buy the item once you have enough money to do so?
My first job in high school included working the layaway desk for a big retailer. Most people put things on layaway because they didn't have the money right then but they expected to have the money before Christmas. The things people put on layaway were either expensive things, like TVs, tools, and jewelry, that were at a great price on Black Friday or things like expensive game systems and other hot toys that would probably be out of stock before Christmas. Buyers might add some other items like coats and whatnot to the layaway pile but most of the stuff was bigger ticket items for which they wanted to guarantee a good price and spread the payments out.

The store offered layaway because it was a chance to lock in nearly all of a customer's holiday shopping right at the beginning of the holiday season. Poor customers will spend less at Christmas than rich customers but it's probably more profitable to get 50% or 100% of a poor customer's holiday spending than 10% or 20% of a upper middle income person's. The poor person doesn't have the luxury of shopping around for a whole holiday season because they might miss out on Black Friday deals and once they've put something on layaway, much of their money until Christmas is going to go to pay those items off. Offering free layaway captures the lion's share of that poor person's holiday spending, which is probably a very profitable outcome for the store.

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Originally Posted by Whack-a-Mole View Post
I really do not know but since you are not buying on credit I cannot see how they can charge interest payments. They keep the item till you pay the full amount. Perhaps they charge a fee for the service but otherwise they get your money in their accounts where they can earn interest or invest it to make more money so it works for the store.
I don't think there is anything in the law that would prohibit a store from charging interest but it doesn't seem like a thing that stores actually do. My store didn't charge interest and it didn't charge a fee for putting things on layaway from Thanksgiving to Christmas. I think its ordinary layaway fee, regardless of how much you bought, was $5.95 (many years ago). Customers also had to put down a 10% deposit, which was fully refundable if they cancelled the layaway before Christmas. There was a cap on the maximum amount they could put on layaway ($500?) but very few people put anywhere near that amount on layaway. I think the average layaway at the time was probably $200 or so.

The store didn't book the sale until the item was paid off. Customers didn't have to make regular payments. If the customer payed off the item, the customer got it. I don't remember if the store charged a restocking fee if customers simply failed to pick up or cancel the layaway before Christmas but I expect they did.

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Originally Posted by Doug K. View Post
I haven't used layaway for many years, but when I did it was because a) I wouldn't have the full price for another paycheck or two, b) I was afraid they'd be out of stock when I did have all of it, and c) I didn't have any credit cards.
This was exactly why most people used layaway in my store. A few people just used it to hide things from their kids until Christmas Eve.

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Originally Posted by Whack-a-Mole View Post
I wonder what happens with sales and such (e.g. you have the item on layaway and are 75% paid up and then the store gives a 50% discount).
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Originally Posted by lingyi View Post
Using layaway can be a hedge against a change in price during the months it's held. If it goes up, you pay the lower price. If something goes on sale for $20 less, even if you pay the $10 Walmart charge for cancelling the layaway, you're still $10 ahead.
My store would give layaway customers the better price as long as they paid the item off in full during the sale period. No need to actually cancel the layaway. They also price matched other stores so people could come in, claim their item, and still get the best available price.

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Originally Posted by Broomstick View Post
People who have certain government benefits will have them cut off if they amass a certain about of money in a bank account.
This makes sense to me but it's not something people tell the layaway clerk, so I never heard this. Most customers didn't discuss their motivations and we didn't ask. Maybe people claiming they were hiding things from the kids were just saying that to save face.

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Originally Posted by Grrr! View Post
The item is usually taken off the shelf by the customer. The customer then carts it over to customer service where they put it in storage.

Also, you can't just put ONE dollar down. It's usually like 10% or something.

Also, when I did layaway some 30 years ago, you put down X amount, then you had 90 days to pay it off. And if you didn't pay it off in 90 days, there would be fees that came out of whatever you already put down.
This was how layaway worked at my store, except I don't remember if there were cancellation or restocking fees.

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Originally Posted by Lord Feldon View Post
That's the whole point of the name. The storage hassle is one of the reasons why so few retailers offer it. The bookkeeping hassle is bad enough, but you also have to keep a back room full of stuff that might or might not be paid off, and might or might not be salable when the layaway period ends.
The overwhelming majority of layaways got paid off in full before the holiday was over but there were some cancellations. I'd guess cancellations were under 5% in my store. I'm sure every coat that didn't get picked up got deeply discounted the day after Christmas, which must have cut into store margins a bit. Those margin losses must be offset by the gains in volume to people who otherwise wouldn't have bought at that store the gifts they put on layaway.

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Originally Posted by kayaker View Post
Years ago a friend worked at KMart. She told me some layaway horror stories. Every December 23rd or 24th there would be people (usually young women) who would come in with the "final $20 payment" for their kids' xmas layaway. My friend would have to break the news that the boyfriend they'd trusted to make previous payments had never done as asked. Must have sucked to be the kids that year.
I don't have any horror stories like this but I do remember people on the last couple of days who would cancel some or all of their layaway. Customers cancelled for different reasons including just changing their minds, grandparents already got them the game system, the kids couldn't wait until Christmas for a coat, just didn't have the money, etc. Most people who came in knew to the penny how much they owed but they got receipts every time they made a payment so it shouldn't have been too surprising.
  #39  
Old 12-10-2018, 11:00 AM
Grave Grave is online now
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Guess there are fewer posters who either are truly poor or came from such a background anymore.

"Lay-a-Way" or similar products were a [benefit / nod / godsend] to those who wanted to own something they could not afford outright. Such programs are available year round - not just for holidays - and function as an interest free loan for many people. The version extant in popular media is just an item savings account for presents because that is what ... sorry, but what people who don't understand the reach of Wal*Mart do.

People place coolers, tents, strollers, guns, exercise equipment, clothes, wheelchairs, walkers, electronics, etc. into layaway. Some are gifts, some are needs, some are wants.

Currently, W*M is the single supplier for ALL of those items in many areas.

So the point of "layaway" runs the gamut from .... you know, it just serves a purpose for a group larger than one should try to define
  #40  
Old 12-10-2018, 11:16 AM
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An alternative here is "Pay-Per-View". Various operators offer it and it means that the customer, usually one with a really bad credit score, can buy that new 54" TV they must have for the World Cup or whatever.

The TV has a meter on the back and you have to feed it with Pound Coins or no TV; alternatively, you buy a card that makes it work. The money in the meter can pay off the cost of the TV and can be used to buy other goods like washing machines etc.

The downside is that the prices charged for the goods are always the manufacturer's full price and interest rates are usurious. An individual can easily end up paying over £1000 for a washing machine that I would pay under £300 for.

Last edited by bob++; 12-10-2018 at 11:16 AM.
  #41  
Old 12-10-2018, 06:23 PM
gotpasswords gotpasswords is offline
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Originally Posted by bob++
An alternative here is "Pay-Per-View". Various operators offer it and it means that the customer, usually one with a really bad credit score, can buy that new 54" TV they must have for the World Cup or whatever.

The TV has a meter on the back and you have to feed it with Pound Coins or no TV; alternatively, you buy a card that makes it work. The money in the meter can pay off the cost of the TV and can be used to buy other goods like washing machines etc.

The downside is that the prices charged for the goods are always the manufacturer's full price and interest rates are usurious. An individual can easily end up paying over £1000 for a washing machine that I would pay under £300 for.
Around here, that's "rent to own" and yes, the payments are E-Z, but the cost should be illegal. Rent-A-Center is one of the big players, and just for giggles, I looked at what it would cost to get a phone through them. A Galaxy Note 9 will cost $173.31 per month -- $3347.66 on a 20-month contract. No voice or data plan is included at that cost, so add another $25-35 per month. In comparison, Sprint will lease you one for $20 a month, then after 18 months you can get a new phone.

But, if your credit score is crap, you won't be able to get that $20/month deal and the usual unlimited talk and text service, so paying a bit north of $200 a month for a phone and basic per-minute plan is probably your only option.

Layaway may take advantage (the $10 setup fee and cancelation charges) of people who can't save or get credit, but rent-to-own preys upon such people.
  #42  
Old 12-10-2018, 06:34 PM
Dewey Finn Dewey Finn is offline
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I don't think in the US there is anything like the coin-operated TV sets like bob++ described. (And I'm not sure how that would work; does someone from the rental agency come into your house periodically to empty the meter?)
  #43  
Old 12-10-2018, 06:36 PM
nearwildheaven nearwildheaven is offline
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They were much more common back when credit cards were something only upper-middle class & above had. Most working class people couldn't even get a credit card, even if they wanted one.
There's a lot of overlap between this, and the fact that married women often needed their husbands' permissions to get a credit card until the early 1970s.
  #44  
Old 12-10-2018, 07:16 PM
nearwildheaven nearwildheaven is offline
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Around here, that's "rent to own" and yes, the payments are E-Z, but the cost should be illegal. Rent-A-Center is one of the big players, and just for giggles, I looked at what it would cost to get a phone through them. A Galaxy Note 9 will cost $173.31 per month -- $3347.66 on a 20-month contract. No voice or data plan is included at that cost, so add another $25-35 per month. In comparison, Sprint will lease you one for $20 a month, then after 18 months you can get a new phone.

But, if your credit score is crap, you won't be able to get that $20/month deal and the usual unlimited talk and text service, so paying a bit north of $200 a month for a phone and basic per-minute plan is probably your only option.

Layaway may take advantage (the $10 setup fee and cancelation charges) of people who can't save or get credit, but rent-to-own preys upon such people.
The same thing can be said for payday or title loans. Exploitation at its finest.

I feel the same way about ads I occasionally see for "Buy your own computer - no credit check needed! Just $15 a week for 36 months!" so that way, a person who doesn't know better thinks they have a bargain; never mind that this is several times the price of even a higher-end home computer, and is the equipment compatible with current software, etc. etc. etc.?

Layaway, when used for the right reasons, can reduce the use of things like this.
  #45  
Old 12-12-2018, 12:20 PM
Irishman Irishman is offline
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Originally Posted by Whack-a-Mole View Post
Does it really work this way?

By that I mean once you put $1 on layaway on an item do they grab that item off the floor and stick it in a corner waiting for you to pay it off?
I work at Walmart. They physically put an item I storage for layaway. That is what the word means.
  #46  
Old 12-12-2018, 02:02 PM
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Darren Garrison Darren Garrison is offline
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I work at Walmart. They physically put an item I storage for layaway. That is what the word means.

Except "they"--meaning the store employees--don't grab an item off the shelf (as the text you quoted asked), the individual shopper brings the item to the layaway desk themselves.
  #47  
Old 12-12-2018, 03:49 PM
Tim@T-Bonham.net Tim@T-Bonham.net is offline
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Originally Posted by Whack-a-Mole View Post
Does it really work this way?

By that I mean once you put $1 on layaway on an item do they grab that item off the floor and stick it in a corner waiting for you to pay it off?
Not $1. At Wal-Mart, it's: "Down payment is $10 or 10%, whichever is greater". Most stores seem to have a minimum 10% to 15% down payment.
  #48  
Old 12-12-2018, 04:39 PM
zimaane zimaane is offline
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I don't think in the US there is anything like the coin-operated TV sets like bob++ described. (And I'm not sure how that would work; does someone from the rental agency come into your house periodically to empty the meter?)
I wondered the same thing. I can see how using a prepaid card would work (although I suspect people would find ways to hack it), but using coins?
  #49  
Old 12-12-2018, 05:12 PM
KneadToKnow KneadToKnow is online now
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IIRC, I bought on layaway twice as a teenager: a boombox and a wool topcoat. The latter taught me a very important lesson about buying clothing on layaway: buy the size you need it to be when you pay it off, not the size you need it to be when you put it on layaway.

Last edited by KneadToKnow; 12-12-2018 at 05:12 PM.
  #50  
Old 12-12-2018, 05:22 PM
kaylasdad99 kaylasdad99 is offline
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Originally Posted by Francis Vaughan View Post
Here in Oz they get called a layby, and they are tightly regulated. But they do make sense. The most important point is that you are contracting to buy a particular extant item. The store is required to put the item away, and will give it to you when it is paid off.
I bought a puppy that way once.

BIG mistake.
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