The National Retail Federation predicts that families will cut back-to-school spending by 8% this year, as they adjust to job losses, reduced hours, and lower credit limits. Those statistics paint a picture, but the rows and rows of plastic bags filled with notebooks, pencils, magic markers, and backpacks hanging in K-mart’s layaway department awaiting payment, paint an even more vivid picture of how the financial crisis is affecting families.
A record number of shoppers are relying on layaway programs to pay for their childrens’ school supplies- which let shoppers pay over time, interest free, and pick up their purchases when they are paid of in full. It’s a good deal considering the sky-high rates that credit card companies have imposed on many struggling families.
Typically, Kmart sees layaways pick up around Halloween, as shoppers get a head start on Christmas shopping, but this year people are setting aside even the most basic items. Retailers who don’t offer layaways say shoppers are buying less and more are paying with cash rather than credit.
http://www.newsobserver.com/business/story/1661005.html
Tags: consumer, economy, education, shopping, unemployment
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