Do you layaway?
I’m pretty sure we’re all vaguely familiar with layaway plans. Even if you’ve never had to use one for a purchase, surely you’ve heard those stories around the holidays every year where some generous stranger walks into Wal-Mart and pays off thousands of dollars on layaway plans as a gift? No? Just me?
Regardless, layaway plans are a way of financing a purchase that allows you to place an item on hold and pay the purchase price in agreed-upon increments until the item is paid for in full. Layaway plans tend to work the same way whether you’re purchasing from Wal-Mart or from an Instagram jewelry seller and this is how:
Select the item you would like to purchase.
Make a down payment on the item.
Pay off the outstanding balance in installments.
Get your stuff!
Layaways became popular during the Great Depression, and remained popular until credit cards became ubiquitous in the 1980s. Currently, layaways can come with a bit of stigma attached. Lots of people will say if you can’t comfortably afford to purchase an item in cash outright, then you can’t afford the item at all. I think everyone should mind their own business, quite frankly. I am of the opinion that it is neither my right, nor my concern, to police other people’s spending. Further, and most importantly, I refuse to believe that only people who are flush with cash deserve to have a little luxury in their lives. Capitalism has us fooled into thinking poor people don’t work hard enough to engage in American consumerism; only the rich should have nice things. And that’s a lie.
I am far from rich, but I can comfortably afford everything I need and nearly everything I want (emphasis on “nearly.” I would like a bungalow in the Keys but I’m not a millionaire, so there’s that). ANYWAY! That doesn’t necessarily mean it’s a prudent choice to purchase a ring for $1900 just because I have the cash and spending it won’t kill me. What if I need to be saving my money for other things? Which happens to be the case. I joked about my financial advisor putting me on punishment for the better part of last year, and wouldn’t you know, she actually did it. I’ve placed a few items on layaway this year, because doing so allows me to remain within the parameters of my budget. This way, I can still buy myself the pretty things I deserve, while I continue to work toward my financial goals for the future.
Which brings me to the benefits of layaway plans (especially when it comes to buying jewelry):
Budget-Friendly—As stated above, layaway plans allow your purchases to fit into your budget, so you don’t overspend.
No Interest—Refraining from credit card use means you won’t incur any interest charges on your purchase, which is always a good thing!
One-of-a-Kind Purchases—When it comes to vintage jewelry, you won’t often find duplicates of a piece you truly love. Layaway allows you the opportunity to nab that special piece!
It’s only fair to discuss some of the disadvantages of layaway plans:
Delayed Gratification—Based on your budget and the terms of your layaway plan, you may be in for a very long wait before you finally get your hands on your item. My longest layaway plan was 9 months for a $900 pink sapphire and amethyst ring. I didn’t intend to take that long to pay it off, and while it actually worked out better for me in the long run, it was quite torturous!
Not Always Available—Some sellers do not offer layaway plans, as it doesn’t make sense for their business model.
Potential for Loss—In the unfortunate event that you realize you are unable to complete the payments for your item, you may not be able to recoup the funds you previously deposited.
Now that we understand the pros and cons of layaway plans, here are some of my tips for how to buy the things you want on layaway:
Decide what your budget is. Be realistic! If you know you have $600 of discretionary funds every month, do you really want to spend $500 paying down your layaway? Probably not.
Assess whether the item you want to purchase can be divided into a sequence of payments that fits your monthly budget. Layaway terms vary by seller, but I’ve most frequently encountered the 3-month plan, where the purchase price is divided into three equal payments due 30 days apart. This is a good place to start your assessment.
Carefully read ALL terms and conditions for purchasing items on layaway. On Instagram, sellers frequently make these terms available to read in their Story Highlights. You want to make sure you understand exactly how it works. Are your deposits refundable? Does the seller provide a refund, minus a restocking fee? If not, do you get a store credit, or do you lose your money altogether? (I’ve never defaulted on a layaway, but I’d personally be wary of entering one in which my entire deposit is completely non-refundable. Seems a bit draconian to me.) How long does the seller take to ship your item to you once you’ve made your final payment? How frequently must you make payments? Some sellers require a strict percentage of the purchase price upfront, and provide payment dates by which you must abide, or you risk forfeiting your hold on the item AND your funds. Others let you pay down as much as you want, whenever you want, as long as the item is paid off within a certain time frame. Do your research and decide whether the layaway terms offered work for you.
Layaway purchases are usually final sale, so make sure that you really, really want the item before you commit to paying it off.
If a seller doesn’t mention layaway, it doesn’t hurt to ask, especially if you have purchased from them in the past. The worst they can do is say no!
One last thing: BE COURTEOUS. It can be a risk for small businesses to place items on hold, so be a kind and conscious consumer. Communicate with your seller. If you find yourself having issues making your payments, or something else comes up—just let them know. You might be surprised at the ways people are willing to work with you.
So that’s about it from me! I currently have one gorgeous, chunky sapphire and diamond ring on a long layaway—it’ll be mine just in time for my birthday, and I cannot WAIT!