Blogging for Change

Is layaway a good option for shoppers this holiday season

by Renee McGruder on
11/4/2011
in Budgeting and Building Savings

Wow! Where has the year gone? I can’t believe the holiday season is right around the corner. And, of course, that means the holiday shopping season has already begun. For many Americans these are still financially trying times and many people are looking to have a festive holiday with a frugal budget.

Recently, an old acquaintance has come back into the holiday shopping mix. Layaway is a payment plan option for buying big ticket items in installments without using a credit card. Many retailers offer layaway plans throughout the holiday shopping season, including, department, jewelry, appliance, and electronic stores. If you are considering using a layaway plan consider these tips.

Know what you can afford. Before entering into a layaway plan decide how much you can afford to spend and develop a budget. Don’t purchase an item on a layaway plan without shopping around for the best price. Make sure the item is affordable and you can pay it off within a reasonable time frame.

Read the fine print. Understand the terms and conditions of the layaway plan before signing on the dotted line. Make sure you understand the length of the payment plan, interest rates, and what happens if you fail to pay.

Understand the store’s return policy. You may buy something and decide you don’t want it half way through the layaway plan. Understanding the merchant’s return policy is crucial when paying for something over time. Do you get all or some of your money back? Will the merchant only offer store credit? Is the item even returnable once a layaway plan is set up? What if you need to make an exchange? These are questions to consider.

Consider other payment options. Often as consumers we will buy items as an instant gratification - especially when there is a “buy now, pay later” option available. Instead try saving for a major purchase. This way you won’t have to use in-store financing or a credit card.

For more helpful tips on layaways, read the Federal Trade Commission’s Consumer Alert called Layaway: Another Way to Buy and check us out at Should Layaway Go Away?.

Renee McGruder is a former communications coordinator and grant writer at MMI.

Recommended Articles

Man sitting in front of pile of bills, trying to understand his options.
Professional Budget Advice
Make the most of every dollar and start building toward your dreams! Budget counseling is FREE and available 24/7.
Learn More
Learn more
  • Better Business Bureau A+ rating Better Business Bureau
    MMI is proud to have achieved an A+ rating from the Better Business Bureau (BBB), a nonprofit organization focused on promoting and improving marketplace trust. The BBB investigates charges of fraud against both consumers and businesses, sets standards for truthfulness in advertising, and evaluates the trustworthiness of businesses and charities, providing a score from A+ (highest) to F (lowest).
  • Financial Counseling Association of America Financial Counseling Association of America
    MMI is a proud member of the Financial Counseling Association of America (FCAA), a national association representing financial counseling companies that provide consumer credit counseling, housing counseling, student loan counseling, bankruptcy counseling, debt management, and various financial education services.
  • Trustpilot Trustpilot
    MMI is rated as “Excellent” (4.9/5) by reviewers on Trustpilot, a global, online consumer review platform dedicated to openness and transparency. Since 2007, Trustpilot has received over 116 million customer reviews for nearly 500,000 different websites and businesses. See what others are saying about the work we do.
  • Department of Housing and Urban Development - Equal Housing Opportunity Department of Housing and Urban Development
    MMI is certified by the U.S. Department of Housing and Urban Development (HUD) to provide consumer housing counseling. The mission of HUD is to create strong, sustainable, inclusive communities and quality affordable homes for all. HUD provides support services directly and through approved, local agencies like MMI.
  • Council on Accreditation Council On Accreditation
    MMI is proudly accredited by the Council on Accreditation (COA), an international, independent, nonprofit, human service accrediting organization. COA’s thorough, peer-reviewed accreditation process is designed to ensure that organizations like MMI are providing the highest standard of service and support for clients and employees alike.
  • National Foundation for Credit Counseling National Foundation for Credit Counseling
    MMI is a longstanding member of the National Foundation for Credit Counseling® (NFCC®), the nation’s largest nonprofit financial counseling organization. Founded in 1951, the NFCC’s mission is to promote financially responsible behavior and help member organizations like MMI deliver the highest-quality financial education and counseling services.