| Credit & Debt | Personal Finance | Economic Crisis | Housing Market | Employment Trends | Expert Insight |
Subscribe  Print 
|
||
Layaway programs could be useful debt management toolSince last year, Americans have been significantly paying down their consumer credit balances, relying more on cash and debit cards to meet their spending needs. This is a contrast from earlier in the decade, when easy credit allowed millions to live beyond their means and make purchases whether they were affordable. However, the current economic climate could actually undermine prospects for a recovery, since even if consumers are paying down an unsustainable debt burden, they're still somewhat reluctant to make retail purchases that in the past accounted for some 70 percent of the U.S. economy. A recent report in the San Jose Mercury News cited the growing popularity of retail layaway programs, which were common up until about the late 1970s before credit card use began to become more prevalent. According to the newspaper, some of the nation's top retailers and even some websites are now offering layaway options. "When you don't really have the money to buy something, putting it on layaway forces you to budget. Use a credit card and you've already bought it and are enjoying it and you don't think as much about making the money to pay it off. So layaway is safer. This country wouldn't be in the credit-card mess we're in if we'd all just use layaway," one consumer, Kent Fong, told the newspaper. Looking ahead, strong retail sales will be widely seen as a sign of a pending economic recovery after the holidays. With that in mind, merchants will be inclined to do what they can to get more shoppers through their doors.
|
||
