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(Yahoo)   Sen. Schumer reminds Americans who are bad at math that after paying "layaway fees" and interest, many of them would have come out ahead just putting the purchase on plastic   (news.yahoo.com) divider line 192
    More: Obvious, APNewsBreak, Elmo, Chuck Schumer, National Retail Federation, credit cards  
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6144 clicks; posted to Main » on 14 Nov 2011 at 1:33 PM (3 years ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2011-11-14 12:14:30 PM  
For example, a rock 'n' roll Elmo doll that requires a $5 layaway fee and a 10 percent down payment for a month can equal a credit card that charged more than 100 percent interest, U.S. Sen. Charles Schumer said Sunday.

OK, I have never bought a rock 'n roll Elmo doll, but a super fast Google search appears to show that they cost about $25.

If you have to put a $25 purchase on a layaway plan, perhaps you should not be making that purchase at all.
 
2011-11-14 12:27:22 PM  
It's nice to know Schumer is there to protect us all from evil and predatory layaway corporations.
 
2011-11-14 01:22:41 PM  
Or, you know, saving to pay for the stuff you want. I don't charge myself fees and interest.
 
2011-11-14 01:35:13 PM  

Pocket Ninja: If you have to put a $25 purchase on a layaway plan, perhaps you should not be making that purchase at all.


Why do you hate America?
 
2011-11-14 01:36:01 PM  
What happened to paying with cash/check?
 
2011-11-14 01:36:37 PM  
It probably costs the retailer more than $5 to keep track of the payments and where the item is in the back.

Wait until he finds out about rent to own stores.
 
2011-11-14 01:38:38 PM  
How desperate do you have to be to use layaway?
 
2011-11-14 01:38:39 PM  
The most dangerous place in America is between Sen. Schumer and a TV camera.
 
2011-11-14 01:39:11 PM  
I'm pretty sure that the people using layaway have either maxed out their credit card or don't have a credit card.
 
2011-11-14 01:40:16 PM  

Diogenes: Or, you know, saving to pay for the stuff you want. I don't charge myself fees and interest.


You're a lot nicer to yourself then I am. I once threatened to break my own leg over money I owed myself.
 
2011-11-14 01:41:42 PM  
Layaway fees... aren't those what you pay a hooker to leave?
 
2011-11-14 01:41:43 PM  
People who use layaway are usually the poor and/or stupid. Don't expect them to figure out they are getting ripped off or even understand this article.
 
2011-11-14 01:41:45 PM  

Atomic Spunk: I'm pretty sure that the people using layaway have either maxed out their credit card or don't have a credit card.


This. It's a way to buy relatively expensive stuff (generally not a single $25 toy) by enforced savings if you don't have any available credit.
 
2011-11-14 01:42:00 PM  
Is there any benefit to layaway other than being assured that the item in question will still be available at the end of payment? How often is that a problem these days? Just save up the bloody money.
 
2011-11-14 01:42:32 PM  

Eirik: The most dangerous place in America is between Sen. Schumer and a TV camera.


Lookout stampede......
 
2011-11-14 01:42:39 PM  

Atomic Spunk: I'm pretty sure that the people using layaway have either maxed out their credit card or don't have a credit card.


This...methinks Dear Senator has misunderstood the target demographic for these services.
 
2011-11-14 01:42:48 PM  
Didn't Chris Rock or Eddie Murphy make fun of layaway?
 
2011-11-14 01:43:13 PM  
Layaway is one of those things like Kmart and Jack-in-the-box (burger store, not the toy) that I'm totally amazed still exist.

A guy at a music store recently asked me if I wanted to put something on layaway. I came really close to asking him if I looked like I was some broke ass no credit having mofo.
 
2011-11-14 01:44:16 PM  
Wal-Mart ended lay-away in 2008 and instead made it far easier for consumers to get a Wal-Mart credit card. The economy collapsed shortly after. Coincidence or correlation?

/hopes someone will bite
 
2011-11-14 01:47:50 PM  

TheGreatGazoo: It probably costs the retailer more than $5 to keep track of the payments and where the item is in the back.

Wait until he finds out about rent to own stores.


This. These are the people we are paying to run the country? It'll cost the retailer much more than $5 (it's called turnaround) if it's something that people want and it's a "hot" item. What a dipwad.
 
2011-11-14 01:49:39 PM  

neetro: Wal-Mart ended lay-away in 2008 and instead made it far easier for consumers to get a Wal-Mart credit card. The economy collapsed shortly after. Coincidence or correlation?

/hopes someone will bite


And if I'm not mistaken, they started again. I know K-Mart did.
 
2011-11-14 01:49:40 PM  
It's for people who can't get credit cards, you idiot.
 
2011-11-14 01:49:54 PM  
It always amazes me each year when people are surprised by the amount of money they spend at Christmas. Here's a novel idea - make a list of people you buy for and how much you are willing to spend on each person. Then figure out the total christmas cost and put that away every month during the year. Then when christmas comes you will have a christmas fund and don't have to worry about layaway or credit cards.
 
2011-11-14 01:50:20 PM  

Pocket Ninja: For example, a rock 'n' roll Elmo doll that requires a $5 layaway fee and a 10 percent down payment for a month can equal a credit card that charged more than 100 percent interest, U.S. Sen. Charles Schumer said Sunday.

OK, I have never bought a rock 'n roll Elmo doll, but a super fast Google search appears to show that they cost about $25.

If you have to put a $25 purchase on a layaway plan, perhaps you should not be making that purchase at all.


And maybe I don't need to drink my own piss, but I like the taste.
 
2011-11-14 01:50:58 PM  
But "layaway" sounds so sexy. Sounds like sex. Lay. I get it. Away. Sounds like "way." In the mind, sounds like "there must be a way to a lay." Sex sells, or at the very least gets put on layaway.
 
2011-11-14 01:51:19 PM  
That's why I don't use layaway. It's a sucker's game. Everytime I want something I can't afford, I just write it down in my little notebook and put the money towards some extra lottery tickets.
 
2011-11-14 01:51:37 PM  

Pocket Ninja: If you have to put a $25 purchase on a layaway plan, perhaps you should not be making that purchase at all.


Diogenes: Or, you know, saving to pay for the stuff you want. I don't charge myself fees and interest.


rebelyell2006: What happened to paying with cash/check?


numbone: How desperate do you have to be to use layaway?


Gee, I wonder why there are people on the streets of most major cities protesting. Couldn't be because they don't have enough money to continue the great commerce wheel and thus have to use means that only put them further back to be the good little consumers that America demands them to be. Nah, they're just hippies.

/In an America where rent-to-own, layaway, and cash advance still thrive, you wonder why people didn't go off sooner...
 
2011-11-14 01:52:04 PM  
Required reading:

stuffialmostbought.files.wordpress.com
 
2011-11-14 01:52:06 PM  

Bacontastesgood: Layaway is one of those things like Kmart and Jack-in-the-box (burger store, not the toy) that I'm totally amazed still exist.



I haven't been to one since I was about 12. They seem like they've really tried to clean up their image. Is their food still godawful?
 
2011-11-14 01:52:20 PM  
If you can't afford what you're buying... DON'T FARKING BUY IT, ASSWAD.

Tell your friends/relatives/kids that you can't afford that expensive piece of shiat they want.

Save up money. Buy it next year.
 
2011-11-14 01:52:52 PM  
Farker Lennavan reminds Americans who are bad at finances that if you cannot purchase something without using layaway or do not have the expendable cash in your account to cover your credit card, you should not be buying unnecessary things.

More at 11.
 
2011-11-14 01:53:18 PM  
I recall layaway plans existing, but I never used one. Isn't it just a small fee, and then payments?

If you buy a big ticket item like a $1,200 tv that $5 payment turns out to be a not so bad thing. If I was broke as a joke it'd be better that than going into debt another $1,200.
 
2011-11-14 01:53:20 PM  

Walker: People who use layaway are usually the poor and/or stupid. Don't expect them to figure out they are getting ripped off or even understand this article.


How is that my, your, Sen Schumer's or the government's problem? It's not.
 
2011-11-14 01:53:28 PM  
Next thing you know they will say those rent to own stores are a scam too!
 
2011-11-14 01:53:32 PM  

Diogenes: Or, you know, saving to pay for the stuff you want. I don't charge myself fees and interest.


I do. Long-term investments and savings come first. Whatever is left over can be spent on toys.
 
2011-11-14 01:53:32 PM  

blahpers: Is there any benefit to layaway other than being assured that the item in question will still be available at the end of payment? How often is that a problem these days? Just save up the bloody money.


One other than the "forced savings" aspect:

You want to pay cash for an item. The item just went on sale, but you do not currently have the cash for the item. You can lock in the sale price and availability by putting it on layaway. If the layaway fees are less than the sale price savings, it's still a net positive.
 
2011-11-14 01:54:04 PM  

IlGreven: Gee, I wonder why there are people on the streets of most major cities protesting. Couldn't be because they don't have enough money to continue the great commerce wheel and thus have to use means that only put them further back to be the good little consumers that America demands them to be. Nah, they're just hippies.


Seriously though, you're a dick for reducing the OWS movement to "people upset they are being forced to buy things they cannot afford." A huge giant dick.
 
2011-11-14 01:54:21 PM  
Only fools use layaway. That's why all of my purchases are rent-to-own. I save a LOT of money.
 
2011-11-14 01:54:30 PM  
I screwed myself over when I was just out of highschool with a credit card and it took 10 years to build it back up. I know how I can get with puting off payments. I'd be more inclined to put something on layaway, instead of a CC just to ensure I didn't fu(k myself over with a late payment, or let it sit on the CC and acrue interest, etc...
 
2011-11-14 01:54:39 PM  
The one good thing about layaway when they didn't charge interest or fees was that you could hide the Christmas presents for free. You get to lessen the number of days that the presents are in the house and lessen the number of days they could be found by the kids.

Layaway is a big hassle for the stores as well. They deserve the fees. They have to maintain a shadow inventory that hasn't really been paid for yet. Sometimes people cancel when they find it cheaper somewhere else. Then they had to give a refund and put that no longer hot item back on the shelf. (I've seen people put sale items on and then cancel the layaway a month later. Then the store has to sell it at clearance prices because it is the only one remaining.) Plus, there is always the chance that if it is a really hot item, there will be employee theft and then you've taken money for something you don't have anymore.

Running layaway sucks. If done properly, then the stores deserve the five dollars.

They can call it a "courtesy" just like banks refer to overdraft charges.
 
2011-11-14 01:54:46 PM  
Or what about store gift cards? Can't you normally add money to these whenever you want? Do that for a few months and you have your Christmas money. I really don't see his argument, lay-away is a great option for some people, how about he spend his time and resources going after some of those ridiculously high interest places like check cash and title loans, or god forbid credit card companies?

Or these people could do what I do, direct deposit $50 every payday to a separate account, this is my Christmas/emergency fund that I try to forget exists until gift buying time.
 
2011-11-14 01:54:53 PM  

jfbnr24: It always amazes me each year when people are surprised by the amount of money they spend at Christmas. Here's a novel idea - make a list of people you buy for and how much you are willing to spend on each person. Then figure out the total christmas cost and put that away every month during the year. Then when christmas comes you will have a christmas fund and don't have to worry about layaway or credit cards.



That doesn't work when you have as many girlfriends as me
 
2011-11-14 01:56:05 PM  

rebelyell2006: What happened to paying with cash/check?


What are you, a hipster?
 
2011-11-14 01:56:19 PM  
My great grandmother didn't believe in paying for things over time. The closest she got was when they bought their first refrigerator. From what I was told, it had a little box on the side that you had to deposit money into to keep the unit running. When it filled up you took the box to the store. Rinse and repeat till it's paid for.
 
2011-11-14 01:56:23 PM  
Yessssss - but the consumer will have actually paid it off, instead of coming up with excuses of why he/she shouldn't pay the balance off on the credit card. Math works wonders when humanity actually sticks to it. Problem is, most people don't.
 
2011-11-14 01:56:39 PM  

jfbnr24: It always amazes me each year when people are surprised by the amount of money they spend at Christmas. Here's a novel idea - make a list of people you buy for and how much you are willing to spend on each person. Then figure out the total christmas cost and put that away every month during the year. Then when christmas comes you will have a christmas fund and don't have to worry about layaway or credit cards.



Why do you hate our economy?
 
2011-11-14 01:56:46 PM  

neetro: Wal-Mart ended lay-away in 2008 and instead made it far easier for consumers to get a Wal-Mart credit card. The economy collapsed shortly after. Coincidence or correlation?

/hopes someone will bite


It's correlation no matter what. The question is wheter the link is causal. Wait, sorry, let me rephrase.

Its correlation irregardless. Which begs the question: isn't it not causal?
 
2011-11-14 01:56:49 PM  
Pocket Ninja: For example, a rock 'n' roll Elmo doll that requires a $5 layaway fee and a 10 percent down payment for a month can equal a credit card that charged more than 100 percent interest, U.S. Sen. Charles Schumer said Sunday.

OK, I have never bought a rock 'n roll Elmo doll, but a super fast Google search appears to show that they cost about $25.

If you have to put a $25 purchase on a layaway plan, perhaps you should not be making that purchase at all.


Lol! Just by using that example proves this guy should be laughed at from now on. Did the lay-away industry make him mad? haha!
 
2011-11-14 01:57:18 PM  

umad: Diogenes: Or, you know, saving to pay for the stuff you want. I don't charge myself fees and interest.

I do. Long-term investments and savings come first. Whatever is left over can be spent on toys.


I have 20% going into my retirement.

Unfortunately it doesn't leave me with much for toys.
 
2011-11-14 01:58:23 PM  
It is a leap to suggest that $5 on a $100 purchase is twice the going rate on credit cards, which today averages 14.99 percent nationwide," said Brian A. Dodge of the Retail Industry Leaders Association.

Not that much of a leap. The 5 dollar cost is for the month. the 14.99 average percent is over the YEAR.

so 14.99/12 = 1.24 per month.
5*12 = 60% APR
 
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