by Dr. Charles Alonzo Peters
I grew up in the Dark Ages – no internet, no ipods, no cell phones, and definitely no credit cards.
I had heard about the Diners Club Card – but that was for really rich people. Then this thing called MasterCard came out. This too was for the well to do, the kind of people that ironically didn’t need credit. This MasterCard wasn’t like today’s pretty pieces of plastic temptation doled out to the masses. These were plain white cards with the large ugly MasterCard logo stamped right on front.
…. and again they were only for people with money.
So what did we do when we wanted something but didn’t have the money to pay for it?
LAYAWAY
Yes, as a kid I dreaded layaway. Perhaps some of you can relate. If we wanted something, and our parents finally relented to our pesky requests, we never experienced the thrill of receiving it on the spot.
No, our Tonka truck or GI Joe action figure was taken to the layaway counter at the back of the Kmart. Here it was tagged and stored in the far depths of the store. My parents would pay on it a little each week and only when it was completely paid for could we take it home.
I despised layaway. Back to school shopping in February. Christmas shopping in August – a kid’s worst nightmare.
Similarly, whenever we couldn’t get our parents to fork over the money, we’d have to save our little allowances. I’d stash my earnings under my mattress safe from my brother’s prying eyes and dutifully watch the cash grow.
Funny thing, saving either by way of the mattress or layaway, always resulted in better decisions.
The impulse nature of “get it now, pay later” was taken out of the picture. After saving my allowance for eight weeks, the cheap model car I dreamed about no longer looked so appetizing. And as my cash pile grew it became even easier to save.
Layaway forced my parents to live within their budgets – no buying stuff with money they didn’t have. No outrageous interest rates or gut wrenching credit card bills waiting in the mail.
Unfortunately, today it seems saving for things has become a lost art.
With credit cards we can have anything we want in an instant, even when we don’t have the money for it. We’ve paid the price too. By time most people finish paying off the credit card balance, the price of a single purchase has risen 10%, 25%, even 50% or more once you figure in the interest charges.
Worse yet, we’ve been turned into a nation of impulse shoppers – not really thinking – just seeing, wanting, and buying. This may explain why the average family is suffering with nearly $8,000 in credit card debt.
Ask yourself, what’s the last thing you ever saved for? The next time you’re shopping and come across that handbag, laptop, or flat screen, why not save for it instead?
You avoid getting fleeced with interest charges and often you’ll realize the item was something you couldn’t afford, didn’t really want, or never needed anyway. Old fashion idea truly, but perhaps a way to avoid suffering the modern day consequences of high debt.
Now that I think about, maybe layaway wasn’t such a bad thing afterall.
So BMWK family do you remember the days of layaway? How do you avoid the trap of “buy now pay later”? How do you keep from falling into the credit card trap? What’s the last thing you ever saved for?
Over the next few weeks you’ll get great weekly insight and tips on managing your greenbacks by Dr. Charles Alonzo Peters of MochaMoney.com so be sure to check back.
TheMrs says
I use layaway all the time, going to pick up one in 48 hrs or so…lol. The items on layaway were a great sale for the things the kids would need for back to school that I didn't realize were on sale so while I was picking up our regular household items I put those things on layaway because they were apart of my budget for this coming week. I put the kids Christmas items on layaway as well in August/September and pick up other items as we get closer to the holidays. As soon as we do finish Christmas, it's birthday layaways(3 bdays in 1 week in April) and then it's the summer layaway and the baby's birthday due to come out in May/June. We only use credit cards for what we have to (i.e. car rentals) or an unexpected broken necessity appliance(fridge or stove). We did the credit card debt thing in our early 20's and shopped til we dropped frequently, now less than 10 yrs later we realize that half the stuff we grabbed we either really didn't need(how many black slacks can I have) or things that we could have waited on. I also shop heavily on clearance racks, got a solid oak dining table for $27 and only got rid of it because it no longer fit our family size, where there are great savings.
Cheryl says
My parents were not big on layaway, I think because as Jamaicans the concept was unfamiliar to them. They would just save until they could afford to buy whatever it was they wanted to. I had my credit card lesson in my sophomore year of college, I think I ended up with $800 in debt, and that cured me! Now that Iam a “responsible adult”, I just save as much as I can, follow our budget, and stay out of the stores when I don't need anything. I used to go to the mall for fun, but all it does is feed the need to buy. The last thing I saved for is my car. It is a crazy liberating feeling to go into the dealership and buy your car cash.
CieCie says
Do I remember the days??? Two months ago I found a stool I really wanted. Since I didn't have the money readily available I decided to go in and put it on layaway only to be told the store had done away with their layaway plan a year ago. I left the store heartbroken. I did come back a week later funds in hand to pick up my stool. With the economy as it is I think stores should bring the layaway back. Although I'm not an avid Wal Mart shopper, I think that is one store that should not have shut down the layaway option.
Since I had a nickle slick mentality in my 20's (my dad's words) I had poor credit so cash and carry was the only way I knew how to live. I ended up with one special store card with a very small credit allowance. I didn't mind. I made do with what was given. But then they tried to catch me up and open up the credit line. Oh no!! Not gonna get me to fall off the credit wagon again. That card is now put away only to be broken in case of emergency!
The last thing I saved for was my house. I had NEVER really saved before then. It was a struggle but a huge accomplishment.
Staycee2 says
I am the layaway QUEEN!!!!!!!!! I have poor credit and love to pay with either my debit card or layaway.
Nikki says
DO you layaway oline or in store? I've heard of elayaway.