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Posted: 6:00 a.m. Monday, Sept. 23, 2013

Layaway returns with no fees



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ClarkHoward.com and the Clark Howard Show offer more money-saving advice for consumers.

By Clark Howard

ClarkHoward.com


After dipping its toe in the layaway waters a couple of years ago, Wal-Mart has been reintroducing this old way to help shoppers play Santa Claus on a cash budget during the holidays.

The nation's largest retailer was the latest to breathe new life into this somewhat antiquated way of shopping. Sears, Kmart, and Toy R Us have all done layaway for the past few years and are likely to again do it this coming season.

But this year, Walmart is doing layaway with no junk fees to set up an account!

Here's how layaway used to work in the past: You'd go in to a store during the fall and put a deposit down on a sale item that you wanted to give someone as a Christmas gift. Traditionally, your deposit was noted on a piece of carbon paper in the days before the computer era!

You would then be able to pay additional money toward the outstanding balance in the weeks leading up to Christmas. Usually by the second week of December, you'd be required to finish paying off the balance in full. If you didn't pay, you didn't get the item and, depending on the retailer's policy, you could lose all the money you'd been paying through the fall.

Layaway went away because people increasingly just decided to charge their purchases on credit, whether they had the money or not.

But I love the idea of layaway because it forces you do to a cash Christmas. Remember, cash is king. Layaway can help you avoid a debt hangover come January. Only spending what you have -- wow, what a concept!

Meanwhile, Toys R Us is doing full price matching on both online and traditional deals this season -- with the exception of Black Friday week. So this Christmas season looks set to be a very promotional one.