Times are hard with many people experiencing difficulties making ends meet. With the holiday season in full bloom, people are expecting a sharp spike in expenses like new clothing, food, and gift ideas. However, less and less consumers are turning to credit cards these days, afraid that they might be stuck with bills they will not be able to settle right away.
Currently, there has been an observed shift of spending behaviour with consumers opting to use debit cards and layaway schemes than conventional credit cards, as a response to the unstable economic situation. People who find themselves maxing out their credit limit or who are in deep debt have no choice, but to rely on other schemes to tide them over.
Layaways are schemes put up by retailers to help consumers work within their budgets and generally present no unnecessary burden to shoppers since they charge no interest. Another interesting advantage of layaways is that parents are able to hide presents from their children and hold them at bay from prematurely opening Christmas gifts.
In the present time, stores are starting to offer layaway plans which could go as high as $10 - money that would eventually be deducted from the agreed upon cost on the time of the purchase. In some stores however, cancelling layaways can be expensive and can set back shoppers by as much as $35.
In the 1970s, layaways were widely popular until it was eventually taken over by credit cards, which during good times offered more convenience and ease. Today, layaway programs are staging a comeback with retailers trying to capitalize on consumers who have credit deficits or who have reached their credit limits. Retailers are aware that people now are more conscious of their spending and are careful not to overspend.
Realizing this growing trend, the government is now embarking on an information campaign led by the Federal Trade Commission to educate people about the dynamics of layaways. Consumers are advised to thoroughly read the terms of layaway plans, paying particular close attention to due dates, late charges, and grace periods for making purchases.
The government is also encouraging consumers to bring to the Federal Trade Commission's office any issues or complaints about layaway plans they know that employ deceptive and dubious practices.
In other related reports, retailers are projecting a weak holiday season, estimating that consumption would go down by 3.2 percent this year. The National Retail Foundation also this early have developed crowd control guidelines which would be put to good use in the days following Thanksgiving, where people are expected to flock to stores or shopping centers.