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Yeah, I Got It On Layaway. What About It?

I applaud the return of installment payments as a shopping option. There's just this one thing.

Alfred Edmond Jr.

Alfred Edmond Jr.

Yesterday, Black Enterprise Managing Editor Alisa Gumbs forwarded a press release to our entire content team announcing retail chain Sears’ promotion of online layaway at barbershops to potential shoppers, so that they could experience the service firsthand. The release was accompanied by a photo of Ronald Larry, a regular patron of De’ Bon’s Barber Shop in Chicago, test driving Sears’ new online layaway program for the first time.

“Now that Sears has layaway online, not only is it easy on my wallet,” Larry is quoted as saying in the release, “it’s easy on my time. I can even get that new flat-screen TV I want, and have it in time for Christmas.”

Gumbs response to this expression of shopping glee is a refrain that echoes often around the offices of Black Enterprise: “This is a hot mess.”

I was confused by her response. I couldn’t see why making layaway more available and accessible as a shopping option, especially given the current economic environment, couldn’t be a good thing. When I pressed her on this point, she responded, “You don’t find anything funny about Sears going into barbershops to try to get black people to use modern technology to buy high-end electronics that they can’t afford—on layaway?”

The truth is, I found it both funny and ironic. However, without layaway and online technology, these same people were still buying high-end electronics that they couldn’t afford, only they were doing it using high-interest credit cards.

With credit cards, they were paying in installments after the purchase and being charged compounded interest to boot. With layaway, they pay the installments in advance, only buying the merchandise after they’ve reached their “savings” goal, and without incurring the interest charges and other fees that are the vast majority of burgeoning credit card balances. With layaway, you have to budget for the purchase, and you have to really want it, since you have to pay nonrefundable fees to participate and failing to keep up with the payments could mean losing all or part of your deposits, depending on the policy of the retailer. Layaway eliminates impulse buying and forces delayed gratification, even if it’s for an item you shouldn’t be buying in the first place.

Back in the day, up until the 1980s or so, layaway was a very prominent option for low- and middle-income shoppers. Then more Americans began to gain access to credit cards, until we finally reached a point where just about anyone (including unemployed college students) could get them—even if they did come with sky-high interest rates and a myriad of fees and penalties in the small print. Layaway faded away as a shopping option, although it never really disappeared.

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  • shai

    yes I agree with your ending statement of how we fell into a death trap with credit cards. Yet in your comments and you left out three important issuses we as black people not yet grasped.

    1. We choose not to place the importancy of what direction our hard earn money leads us,why we make the decisions how we spend our income,where is the optimal places our money is best utilize to us individually and collectively as a black community and who hands we place our trust with our money , surely not YOU KNOW…YOU KNOW.

    2. We do not prepare our children with the education of what is needed to justify our purchases when society say we must and should have IT.

    3. We as a Black community with a plethora of enterpernuers,ceo’s,financial experts,
    mathematicians,scientists,community activist,political and religous leaders, fathers and mothers has not made a unifide stand to rectify the FINANCIAL AND EDUCTIONAL GENOCIDE OF OUR PEOPLE. INSTEAD SELL WE BOOKS,CDS, AND SEMINARS OF FALSE DREAMS.

    Sadly we continue attaching ourselves to every ohter race when they clearly have shown their distrust, lack of respect, they continue with their metastatic races beliefs, with little no desire to join forces with us to make our world better for the human race.

    You my brother instead, sided with the establishment of slugs of this world who pimps us with their propaganda garbage,into having false sense of selfish entitilment.

    At the end of the movie School Dazes by Spike Lee, the student rings the bell (the bell of atonement) and says…..WALE UP!!!!!!!! (MY PEOPLE WAKE UP!!!!!!!!)

  • http://blackenterprise.com Alfred Edmond, Jr.

    In response to Shai:

    1. Who’s “we”? Like most sweeping generalizations, sounds like a broad, speculative assumption not based on actual research and observation.
    2. Aren’t books, CDs, seminars etc., the usual tools for teaching? Does not their very existence contradict your assertion that no effort is being made to rectify “the financial and educations genocide of our people”?

    I am hopeful that you are contributing to the education of our children and community in the area of financial education and smart consumerism. Alarm bells have their place, but the real difference is the work done after the bell of atonement is rung.

  • http://www.dreamandhustle.com Ed Dunn

    This is a great article because layaway demonstrated fiscal responsibility.

    When I was a teenager in the inner city, me and my peers would work a part-time job and put the money on layaway at Footlocker or at the Department store. Layaway taught us how to save up for our goal instead of the ‘charge it” instant gratification.

    I’m glad to see it coming back so I can teach my kids how to save up for that item in the window.

  • Stephanie

    This is a really terrific article and I applaud you for writing it. I grew up with lay-a-way and my parents shunned debt. They are now less than 1 year from paying off their home and have banked my mom’s salary and lived completely off my dad’s for 15 years. I put things on lay-a-way now and teach my children that it’s a much better way to pay…I’d rather see them have delayed gratification that debt.

  • http://twitter.com/algierslady Pearl Forbes

    Yes, layaway is good for large companies and people with limited resources. Layaway is bad for the small business that need to pay their bills within thirty days. I HAD a Gift Shop that sold “All God Children” figuerines. When a new figuerine came out, people would flock to the store to place pieces in layaway. Although half of the cost was paid in layaway, it was not enough to pay the Company for the figuerines. Layaways are not for small businesses struggling and just happy to have business.
    I also understand the credit card. I purchased from TD Jakes an Empowerment Program for four installments of $49.50 on my credit card which took forever to pay off… The paying off of the debt was more empowering than the program. Smile.

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