Dollars and sense 11/3/11

DOLLARS AND SENSE

Use Layaway Instead of Credit Cards

It’s time for merchants to go into high gear with their enticements to spend money. After all, their holiday decorations have been up for at least a month now.

But are you ready?

Even if you’ve saved and are ready to pay cash for your purchases, new tricks by banks could add expenses in the form of debit-card fees unless you keep a high account balance, and you won’t want to carry cash while you shop. (Be sure to read the literature from your bank to be forewarned about changes to your account.)

If there are must-have items on your children’s lists this year, chances are those items also are on other children’s lists. If you don’t have all your cash handy, by putting merchandise on layaway, you guarantee that those items will be held for you.

Walmart has brought back its holiday layaway program. You’ll be required to pay a $5 fee and put down 10 percent of your purchase. Purchases must total more than $50, and each item must be $15 or more.

Kmart and Sears also have layaway: There’s a $5 fee for the layaway contract, and $15 if you cancel before paying for your merchandise. You’ll need to pay $20 or 20 percent down, whichever is greater.

At Best Buy, your layaway items must total more than $250. You’ll also have to pay 25 percent down as well as a 5 percent fee. This can still be a good deal if it helps you grab an expensive item when it’s on sale. Do the math.

Toys “R” Us has a layaway plan for eligible merchandise. You’ll pay a $5 fee and put down at least 20 percent. The cancellation fee varies by state.

Beware using online layaway for purchases you make over the Internet. These retailers offer an enticing low fee, but consider the ramifications of putting your banking information online: Money is automatically deducted from your account at regular intervals. If you cancel, they’ll hit your account for $25 or 10 percent of the layaway total. Consider, too, the hassle of merchandise that is delivered late or damaged.

Once the holidays are over, open a Christmas Saver Club account at the bank or credit union. If you make regular deposits, by the time next year rolls around, your holiday spending money will be in hand.

(c) 2011 King Features Synd., Inc.