The return of layaway

Layaway is a concept that a lot of younger people are not familiar with. When credit cards became popular, layaway programs started to disappear until they had become extinct. I am pleased to see these programs have returned.

Instead of using a credit card to pay for a purchase after making it, layaway allows you to select the items you wish to buy, pay for them over time and then take possession when you have finished paying for them. The first store I noticed that had brought back layaway was Bob’s Discount Furniture, which is a large chain in New England and surrounding states. Then I noticed larger stores like Wal-Mart and KMart reintroduced layaway programs. Tonight, I noticed that smaller chains, like GameStop, are giving people the option.

I commend these stores for allowing people this option. It’s a way for people who aren’t great at saving to purchase items without resorting to credit. While I would prefer to use a Christmas club account to pay for these purchases, layaway is something I am glad to see again.

Making a list, checking it twice

When I posted about how much I hate cash I got a number of comments on twitter and facebook with the fact that Dave Ramsey says you spent 12% to 18% more when using plastic than when using cash. Here is how to get around that:

1. Have a very strict budget and update it throughout the month as you are spending. Pick a day each week to go online with your bank and figure out how much you spent in each category. I use QuickBooks for this, but there are a number of other programs out there that are less expensive. You can even use a spreadsheet if you want and download your bank activity into the spreadsheet, then add a column for category. Fill in categories and then sort by that column. See, free budgeting software right there on your computer! I update my budget before each shopping trip so I know exactly what I can spend.

2. Always have a list when you shop. Always. Even when going to the mall, I have a list of what I am looking to buy and my budget. That way, I know how much I can spend. The most important places to have a list are Wal-mart/Target and the warehouse club, if you belong to one. It’s so easy to pick up things you don’t need.

3. Limit the number of trips to the store. Every time you go to the store, you increase your chances of purchasing impulse items. Make a list during the week, making sure you watch for things that are running low before you actually run out of them. Running out of cat food will instantly send you to the store. Put it on your list before running out. I also find psychologically people feel better when they go to a store and come out with multiple items. I watch a lot of people. It’s very rare that people will walk out of Wal-mart or Target with one item. Therefore, add items to your list as you progress through the week and only go once.

4. Keep your list in a high traffic area. I use my fridge. I usually have two magnetic pads on my fridge, one for groceries and one for nongroceries. I do not purchase nongrocery items at the grocery store unless there is a MEGA SALE, which doesn’t happen very often. Nongrocery items are generally a lot more expensive at the grocery store. It’s better to buy them at Wal-Mart or Target. Sometimes pharmacies will also have MEGA SALES on these types of items. So stay on the look out.

5. Always keep your coupons with you. You never know when an item from your grocery list might show up on sale at Wal-Mart, Target or the pharmacy and they all except coupons.

If you can keep your eye on the prize (staying within budget), you can avoid spending that extra cash without having to pay with cash. That makes me happy. I still hate cash.

Are you a list shopper?

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