Layaway returns as a way to afford the holidays
Filed under: Shopping
Toys "R" Us and Babies "R" Us are giving Santa (and cash-strapped parents) an early gift this holiday season: Layaway.
Monday the toy store chain announced the introduction of in-store layaways as a means to help customers spread out payments on some holiday purchases.
But, don't rush out to stash Barbie on a back room shelf just yet. Not all items in the stores qualify . "Big gifts" like cribs, car seats, bikes, TVs, dollhouses, karaoke machines and wagons -- those not often stocked -- are a sampling of the things that are eligible. Shoppers wanting to get a jump on summertime can also layaway kiddie pools and water slides to give as holiday gifts.
To place an item on layaway, you've got to pony up a deposit equal to 20% of the total purchase (including all taxes) plus a $10 service charge. Payments can be made in-store or by phoning the store you opened the layaway at. You can use cash, check, credit or debit or gift cards for payments and a fee (that varies by state) will be applied to any layaway orders that are canceled.
You've got to have everything paid in full by Dec. 6. Jenn Albano, director of corporate communications, said that'll guarantee merchandise will make it under the tree in time.
"Items will be available within seven to 10 days of the final payment and customers can pick up items in the store, or arrange for at-home delivery for an additional charge," Albano said.
The layaway program is not available in Maryland while residents in Ohio and Rhode Island are subject to a different cancellation policy than in other states.
Not wanting to miss out on your holiday shopping dollars, Kmart and its parent company, Sears, are also offering a holiday layaway program.In addiiton to toys, shoppers can tuck sleepwear, dartboards picture frames, shoes, and a host of other household goodies. As an added bonus, you can point and click your way to a Kmart or Sears layaway. Just look for the layaway icon on products on their sites for additional information and to open an account.
"Payments can be made in person or online, and you can arrange to pick items up in person, or pay for delivery," said Susan Ehrlich, president, Financial Services, Sears Holdings.
Shoppers can leave items on layway for up to eight weeks and are required to put down a 10% to 15% deposit, plus a $5 new account fee. Payments are expected b-weekly, although you can pay off the balance sooner. The cancellation fee is $10. When a goal is reached, you can transfer the money saved -- plus interest -- back to your checking or savings account to spend wherever you want. But, you can also receive it on a SmartyPig MasterCard debit card (which can be used anywhere MasterCard is accepted) or put it on a retail gift card from name brand partners such as Best Buy, Home Depot, Macy's Pottery Barn, Amazon.com and many others. If you chose a retail gift card, the merchant will tack on an additional award -- up to 6%.
"SmartyPig cards, and those of their retail partners, never expire and aren't charged fees inf not used by the end of the year," Spencer said.
If toys, tools or towels aren't your cup of tea, SmartyPig, the high-tech piggy bank, offers consumers the option to open goal based savings accounts to stash holiday gift cash. These accounts come with a 2.01% APY.
Tiffany Spencer, spokeswoman for SmartyPig, said, "users create specific savings goals, determine a savings schedule, automate regular contributions from their existing checking or savings account, and track their progress while earning one of the most competitive interest rates in the country."
And if you happen to be eyeing gifts for the 2010 or 2011 holiday seasons, Gettington offers an "easy" payment plan that lets you spead payments out on thousands of items for as long as 24 months.
Just like a credit card, you've got to apply and if approved, will be charged a variable APR of 19.90%. Payments must be $20 or 5.5% of the balance -- whichever is greater. They also tack on a late payment fee of $24.90, so even though this plan is easy, it sure isn't cheap.
Gina Roberts-Grey is a freelance journalist specializing in consumer issues.
Reader Comments (Page 1 of 1)
10-21-2009 @ 5:09PM
Paula Drum said...
Hi Gina:
Always good to get more information to consumers so they can make the best choice for their personal budgets! As you may have noticed, Gettington offers a ‘fast’ payment plan in addition to the ‘easy’ payment plan. The ‘fast’ plan has an APR of 14.9% and has four monthly payments. Both plans do have higher minimum payments than what you typically see in credit cards---we created the payment plans that way intentionally to help our consumers use credit responsibly and help avoid the creation of perma-debt which can result from making only the ‘low minimum payment’ required by many credit cards.
Transparency is key for us so every page of the Gettington.com website has a visible shopping cart where you can see your selections along with your payments options. As you mentioned, this is a credit account versus a pure layaway program. Unlike layaway, shopping at Gettington means receiving your purchase immediately, not until your bill is paid off. This gives consumers extra flexibility for holiday shopping and allows them to manage their budgets since we are only three months away. We created the Gettington payment options to be responsible credit options. There is no annual fee, no overlimit fee, no penalty interest rate and the late fees are lower than other options such as a JC Penny store credit card or Amazon Signature Visa Rewards card as of September 24, 2009
All your readers can find out more about Gettington's credit promise at www.gettington.com/creditpromise
Be great!
Paula Drum
General Manager
Gettington.com
Reply