Buying on credit isn’t ideal layaway alternative - Military Money, Navy Money, navy pay, pay charts - Navy Times

Buying on credit isn’t ideal layaway alternative

Listen up. The Marine Corps Exchange has dropped its layaway program — one more example of a growing trend.

“Layaway programs are pretty much a thing of the past, now that credit is much more widespread and easy to obtain,” said Kathy Grannis, a spokeswoman for the National Retail Federation.

“Layaway is almost defunct,” Grannis said. “A lot of small-town stores still have a layaway-type program, but for customers, the ability to take something home immediately is much more attractive than paying for it over a few weeks while not being able to enjoy it.”

Customers who already had items on layaway in Marine exchanges will have time to pay them off, but the stores are not accepting new items.

Although Marine Corps Exchange officials did not respond with the details behind their decision, it’s clear that layaway programs cost money. The exchanges have to store items on layaway, which takes up warehouse space, and someone has to keep track of payments and inventory.

But while the use of layaways has been dwindling over the years in favor of bringing items home immediately, buying something on credit and then paying high interest rates over many months is not the best alternative to layaway.

Here are some options:

•If you’re anywhere near another base, you can do your shopping there and continue putting items on layaway. The Army and Air Force Exchange Service and the Navy Exchange Service Command still allow layaways. There are some exceptions; for example, AAFES does not allow you to put computers, seasonal items or flammable items on layaway.

•For major purchases, such as school clothes or furniture, you can create your own “layaway program” months before you go shopping. Stash some cash in a savings account each month until you’ve saved enough to buy the item.

•If you use a credit card, pay off the purchase within a couple of months, preferably at the end of the first month when the payment is due. If you pay off the balance and use a rewards card that offers cash rebates, you’ll even make a little money with your necessary purchases.

•Try out a relatively new concept at http://www.eLayaway.com, which you can join for free. You can pay for an item in installments rather than adding to your credit card balance.

You can buy almost anything through eLayaway, from a barbecue grill to a home gym to a cruise.

Air Force veteran Sergio Pinon, who founded the company with his partner, Matthew Ryncarz, said some service members use the Web site to pay for items during their deployment and have the items shipped to them when they return. And some folks use it to budget when they’re planning travel — booking a trip and then paying for it over several months rather than facing alarge credit card bill when they return.

About 100 merchants have items available on the site. They include retailers such as CompUSA, Weber Gas Grills, BBQ Guys and Fitness Pro Inc., but also some retail Web sites, such as http://www.shopperschoice.com, that host scores of retail stores.

ELayaway is about to add http://www.storesonline.com, Pinon said, noting that the company is “adding more merchants every day.”

The merchant chooses the time period it can hold an item. No credit card is required to become a member of eLayaway; it deducts your payments from a checking account, and it is flexible about the payment time. If a customer decides to cancel the purchase, the money is refunded, except for a cancellation fee of $25.

“We don’t allow merchants to charge exorbitant fees,” Pinon said.

ELayaway charges a 1.9 percent fee for the layaway — which works out to $1.90 for each $100. But Pinon says the company will waive this fee for members of the military community — active duty, retirees, veterans and their family members, to include parents. Just enter the promotion code “USA” and this will allow you to get your first 10 transactions for free per person. Depending on how often you shop on the site, this will last you a while.

As always, whether you’re shopping on the Internet or in your local brick-and-mortar store, do some comparison shopping of prices and shipping charges to get the most out of your dollars.

Got that? You’re good to go.