Christmas is coming up and fast! This time of the year means a lot of different things for a lot of different people, but gift giving seems to the one commonality we all share. There is nothing wrong with that, after all, we are taught that giving is far more fulfilling than receiving. Though the part that is often left out of that little nugget of truth is that we needn’t get ourselves into debt in order to give. This season welcomes consumers willing to spend entire paychecks on presents, and what they can’t afford can be charged to a credit card. Now some consumers don’t have the financial stability to be issued a credit card, or they are simply spent to the gills. In which case the stores, in all of their wisdom, decided to start layaway for shoppers. I remember this method of payment when I was a child, in fact it was quite common back then. It seems to be making a resurgence of sorts as consumer spending is on the rise yet again, even though access to credit might not be.
What’s my problem with layaway you may ask? Well, it’s not exactly the smartest financial decision in the world. I’ve said it before, and I’ll say it again, as long as you spend less than you make then you will never go broke. Sure this doesn’t really answer how you plan on saving for retirement, but at least it avoids debt. Layaway is purchasing items for which you do not currently have the money. Now I will admit that you may not get to take the item home until it is fully paid for, but you should be asking yourself what happens when you can’t fully pay for it after a specified period of time. The answer is that you typically are assessed a penalty of sorts, or you lost the entire down payment you placed to hold the item in the first place. That isn’t going into debt, but it is throwing away money that could be better spent elsewhere. The moral of my story is that if you don’t have it, and I mean ALL of it, then don’t spend it!