{"id":8590,"date":"2024-11-26T14:00:50","date_gmt":"2024-11-26T14:00:50","guid":{"rendered":"https:\/\/finderica.com\/should-you-use-layaway-for-black-friday-shopping\/"},"modified":"2024-11-26T14:00:50","modified_gmt":"2024-11-26T14:00:50","slug":"should-you-use-layaway-for-black-friday-shopping","status":"publish","type":"post","link":"https:\/\/finderica.com\/?p=8590","title":{"rendered":"Should You Use Layaway for Black Friday Shopping?"},"content":{"rendered":"
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As you shop <\/span>Black Friday deals<\/span>, you may notice certain retailers offering layaway as a payment option. Layaway allows you to pay for an item over time, which can make the purchase easier to manage alongside other expenses in your budget. However, you won\u2019t get the item until it\u2019s completely paid off, and you may be responsible for fees. <\/span><\/p>\n<\/div>\n

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Here\u2019s what to know about layaway and whether this option is the right choice for your holiday purchases.<\/span><\/p>\n<\/div>\n

What is layaway?<\/span><\/h2>\n
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\u201cLayaway is a really cool old-school approach to buying something that you can’t pay for all at once,\u201d says Lisa Gill, a Consumer Reports investigative reporter who covers money topics.<\/span><\/p>\n<\/div>\n

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Layaway is a payment plan where the buyer makes a down payment on an item \u2014 either a set dollar amount or a percentage of the price \u2014 and pays the remaining amount in installments or a lump sum. The seller sets the product aside, and the buyer receives it once they’ve paid the full amount. <\/span><\/p>\n<\/div>\n

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Looking for Black Friday shopping tips? Ask a Nerd!<\/span><\/h3>\n

To prepare for Black Friday, ask our Nerds how to find the best deals and how to use layaway. We\u2019ll reply within two business days. Get instant access plus up to $250\/year in cash rewards by joining SS+ for $49\/year.<\/span><\/p>\n<\/div>\n<\/div>\n

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Layaway vs. buy now, pay later plans<\/span><\/h2>\n
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Layaway and <\/span>buy now, pay later<\/span>, or BNPL, plans from companies like Afterpay and Klarna both give shoppers a way to break up the cost of a purchase into smaller payments. But these plans have some key differences. <\/span><\/p>\n<\/div>\n

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Timing:<\/span><\/span> With layaway, the retailer holds the item until you\u2019ve finished paying it off. With BNPL, you get that item immediately. As far as how long you make payments, layaway timelines usually range from a few weeks to a few months. BNPL payment plans typically take six to eight weeks over a span of four payments, Gill says.<\/span><\/p>\n<\/div>\n

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Payment types:<\/span><\/span> Layaway payments are typically made with cash, check or credit card, depending on the retailer\u2019s policy. BNPL payments are usually made with credit cards, debit cards or bank accounts. <\/span><\/p>\n<\/div>\n

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Missed payments and credit impact:<\/span><\/span> Neither on-time nor late layaway payments are reported to the credit bureaus. The retailer\u2019s collateral for missed payments is your purchase that it\u2019s holding. <\/span><\/p>\n<\/div>\n

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BNPL is a no- or low-interest loan that requires taking on debt and possibly getting a <\/span>credit check<\/span>. Late BNPL payments could be reported to the credit bureaus and result in fees. The debt could be sent to a <\/span>collection account<\/span>, which would hurt your credit score. <\/span><\/p>\n<\/div>\n

Advantages and disadvantages of layaway<\/span><\/h2>\n
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While layaway doesn\u2019t lower the total cost of your purchase, it can make it more manageable by dividing it into smaller payments. Layaway also guarantees that the product doesn\u2019t go out of stock before you have enough money to buy it. <\/span><\/p>\n<\/div>\n

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But there are drawbacks, too. While a layaway plan won\u2019t harm the user\u2019s credit, the unreported on-time payments won\u2019t help it, either. And shoppers may have to pay nonrefundable deposits and other costs, such as storage or cancellation fees. Depending on the plan terms, you could end up paying more for an item using layaway than if you had bought it outright.<\/span><\/p>\n<\/div>\n

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In many cases, \u201cif a consumer cannot make the payments, they forfeit the money and the item they put on layaway,\u201d Michelle Smoley, director of personal and college finance at Bright Horizons College Coach, said in an email. Still, that\u2019s a better outcome than <\/span>dealing with a debt collector<\/span>. <\/span><\/p>\n<\/div>\n

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Looking for Black Friday shopping tips? Ask a Nerd!<\/span><\/h3>\n

To prepare for Black Friday, ask our Nerds how to find the best deals and how to use layaway. We\u2019ll reply within two business days. Get instant access plus up to $250\/year in cash rewards by joining SS+ for $49\/year.<\/span><\/p>\n<\/div>\n<\/div>\n

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Which stores have layaway?<\/span><\/h2>\n
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Layaway isn\u2019t as common as it once was. \u201cLayaway plans were much more prevalent before access to credit cards was expanded and during a time when more shoppers shopped for items in person,\u201d Smoley said.<\/span><\/p>\n<\/div>\n

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\u201cMost big-box department stores and retailers no longer offer layaway plans,\u201d Smoley said, including Walmart and Amazon, which ended its Amazon Layaway service in October.<\/span><\/p>\n<\/div>\n

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You may be more likely to find layaway at smaller businesses, such as vintage stores and pawn shops, Gill says. But some bigger companies still provide the option. <\/span><\/p>\n<\/div>\n

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A few of the retailers offering layaway plans at the time of this writing include:<\/span><\/p>\n<\/div>\n

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