As a savvy shopper, you‘re always on the lookout for the best deals and payment options, especially for big-ticket items. One popular method for affording large purchases is layaway – a program where you put down a deposit to reserve an item and pay the rest in installments before picking it up. Retail giant Walmart has offered layaway in stores since 2006, with other retailers like Kmart and Sears following suit. But what about the king of online shopping: does Amazon have layaway too?
The short answer is no. Amazon does not currently have a traditional layaway program where you can pay for items in installments then have them shipped once paid in full. However, that doesn‘t mean there aren‘t other ways to budget your Amazon purchases and spread out payments. In this guide, we‘ll take an in-depth look at all your options as a smart Amazon shopper.
The History and Evolution of Layaway in Retail
To understand why Amazon doesn‘t do layaway, it helps to look at the history of the concept. The layaway process dates back to the Great Depression in the 1930s, when cash-strapped consumers needed a way to make purchases without relying on credit. Stores would allow customers to put down a small deposit (usually 10-20% of the purchase price) to hold an item, then pay the rest in installments before taking the merchandise home.
Layaway surged in popularity again during the 2008 recession, with Kmart, TJ Maxx, Marshalls, and Burlington Coat Factory all heavily promoting the service. Toys "R" Us even waived its usual $5 layaway service fee for holiday purchases. The programs were a lifeline for consumers short on funds but wary of high-interest credit card debt.
However, in recent years, layaway has fallen out of favor with some major retailers. In 2017, Walmart discontinued its layaway program for everything except jewelry due to declining use. Many consumers now prefer the instant gratification of taking items home immediately, even if they have to use credit. Online installment payment programs from startups like Affirm, Afterpay, and Klarna have also grown as flexible alternatives to layaway.
Why Amazon Doesn‘t Do Traditional Layaway
So why hasn‘t Amazon, the world‘s largest e-commerce company, ever offered a layaway option? A few key reasons:
-
Logistics and inventory management. Amazon is known for its lightning-fast shipping, often within 1-2 days for Prime members. The company‘s fulfillment centers are optimized to get orders out the door quickly, without reserving items for long periods. Layaway requires setting aside stock and storage space, which goes against Amazon‘s strategy of efficient inventory turnover.
-
Limited brick-and-mortar presence. Many retailers use layaway to drive foot traffic to physical stores, where customers pick up orders and may make additional purchases. Amazon has experimented with bookstores, grocery and convenience stores, but e-commerce is still its bread and butter. There‘s less incentive to offer in-store layaway when your business is primarily online.
-
Customer preferences and alternatives. Amazon prides itself on offering competitive prices, a wide selection, and convenience above all. For most shoppers, waiting weeks or months to pay off and receive a purchase defeats the purpose of buying from Amazon. The company has instead focused on other financing options, which we‘ll discuss below.
-
Financial risk and costs. With layaway programs, retailers take on the risk that customers won‘t follow through with payments, leaving them with returned stock. There are also costs involved in managing layaway plans and processing fees. For a low-margin business like Amazon, it may simply not be worth the potential downsides.
That‘s not to say Amazon hasn‘t considered layaway. In 2016, the company filed a patent application for a "virtual layaway" system that would let customers reserve items then make periodic payments before shipping. However, this has yet to materialize into a full-fledged layaway program.
Amazon Monthly Payments: The Closest Alternative to Layaway
While Amazon may not have traditional layaway, it does offer a similar payment option called monthly payments. This program allows you to split the cost of certain items into 5 equal monthly installments, with no interest or finance charges.
Monthly payments are available for select products sold and shipped by Amazon, including:
- Kindle e-readers
- Fire tablets
- Amazon Echo and Alexa-enabled devices
- Fire TV streaming media players
- Ring home security devices
- Eero Wi-Fi routers
- Blink smart home cameras
To give you a real-world example, let‘s say you wanted to purchase the All-New Kindle Oasis E-reader, which retails for $249.99. With monthly payments, you would be charged $50 at the time of shipment, then four additional $50 payments every 30 days. You get the device right away, but can spread out the cost over time.
Keep in mind that monthly payments have some restrictions:
- Only Amazon devices and accessories are eligible, not general merchandise
- You must have a valid credit card on file as the payment method
- The total tax on your order is due at the time of purchase
- If you return the item, you‘ll receive a refund minus the payments you already made
- Monthly payments can‘t be combined with other discounts or promotions
One key difference between Amazon monthly payments and traditional layaway is that you receive your purchase immediately, rather than having to wait until it‘s paid off. This can be helpful for time-sensitive purchases or gifts. Just be sure you‘re able to keep up with the installment schedule and not overextend your budget.
Using Amazon Credit Cards for Large Purchases
Another way to finance big-ticket items on Amazon is to use one of the site‘s branded credit cards. Amazon offers two Visa cards through Chase Bank: the Amazon Rewards Visa Signature Card and the Amazon Prime Rewards Visa Signature Card (for Prime members).
Both cards offer 0% promotional APR financing on eligible Amazon purchases over a certain amount, spread out over 6, 12, or 24 months. As long as you make your minimum monthly payments and pay off the full balance by the end of the term, you won‘t be charged any interest. However, if you fail to do so, you‘ll be retroactively charged interest from the original purchase date – so be careful.
Here‘s how the financing tiers break down for the Amazon Visa cards:
| Purchase Amount | Financing Term | APR |
|---|---|---|
| $149+ | 6 months | 0% |
| $599+ | 12 months | 0% |
| $799+ | 24 months | 0% |
So if you bought a $2,000 DSLR camera bundle on Amazon using your card and selected the 24-month financing option, you‘d pay roughly $83 per month for two years, with no interest (assuming you pay on time). This can make high-end electronics, furniture, and other big purchases more manageable.
In addition to promotional financing, the Amazon Rewards Visa and Prime Rewards Visa also earn you 3% and 5% cash back respectively on all Amazon.com purchases, as well as 2% back at gas stations, restaurants and drugstores, and 1% everywhere else. You can redeem rewards as a statement credit or toward future Amazon purchases. The Prime card has a $119 annual fee (the cost of Prime membership) while the regular Amazon Visa has no annual fee.
Affirm Financing for Amazon Purchases
In 2021, Amazon partnered with financial technology company Affirm to offer installment financing on purchases over $50. At checkout, eligible customers can choose to split their total into monthly payments over 3, 6, or 12 months, with APRs ranging from 0-30% based on creditworthiness.
Affirm performs a soft credit check to determine which payment plans you qualify for. Once approved, you make your first payment at checkout, then monthly payments thereafter until the balance is paid in full. Affirm will send you email and text reminders when payments are due.
One advantage of Affirm over credit cards is that you know exactly how much you‘ll pay each month and your payoff date. There are no late fees, compound interest or surprises. The trade-off is that longer financing terms may have high APRs, and not everyone will be approved for 0% financing.
As of March 2023, Affirm financing on Amazon is available by invitation only to select customers. To see if you‘re eligible, look for the Affirm option at checkout or visit the Affirm at Amazon page.
Other Ways to Budget and Save for Amazon Purchases
Layaway and financing can help make large purchases more affordable, but they‘re not the only smart ways to budget for Amazon shopping. Here are some other tips and tricks to consider:
- Amazon Allowance: This free feature lets you set up automatic recurring deposits into an Amazon gift card balance, either for yourself or others. For example, you could load $50 per month onto your account, then use that balance for purchases. It‘s like a digital version of the "envelope method" budgeting system.
- Amazon Wish Lists: Use the wish list function to save items you want and track price changes. You can set alerts to be notified when prices drop or items come back in stock. This allows you to plan ahead for purchases and wait for the best deal.
- Subscribe & Save: For household essentials you buy regularly, Amazon‘s Subscribe & Save program can get you up to 15% off and free shipping. By committing to automatic deliveries every 1-6 months, you save money and avoid running out of must-haves.
- Deal tracking and price history: Use third-party tools like CamelCamelCamel or Keepa to view an item‘s price history and set up alerts for price drops. You can also check out the Today‘s Deals and Lightning Deals sections for limited-time offers.
- Online rewards and cash-back portals: Sites like Rakuten, Ibotta, and TopCashback offer a percentage back on your Amazon purchases when you start your shopping trip through their affiliate link. You can redeem rewards via PayPal, gift card or mailed check.
- Coupons and discounted gift cards: Check reputable online marketplaces like Raise and CardCash for discounted Amazon gift cards. You may be able to score credit for less than face value, stretching your spending power. Just be sure you‘re buying from a legitimate reseller.
Ultimately, the key to affording Amazon purchases is planning ahead and finding a budgeting strategy that works for you. Whether you go for monthly payments, credit card financing, Affirm, or good old-fashioned saving up, there are plenty of options beyond traditional layaway.
The Psychology of Layaway and Delayed Gratification
So why do people use layaway, anyway? Isn‘t it better to just buy something outright or wait until you can afford it in full? Psychologically, layaway taps into our desire for delayed gratification and commitment to a goal.
Studies have shown that people often place a higher value on something they‘ve had to wait and work for. It‘s the same principle behind saving up for a big purchase or waiting for a special occasion to indulge. Layaway creates a sense of anticipation and reward, even if you don‘t get the item right away.
There‘s also the accountability factor. When you‘ve put money down on a layaway plan, you‘re more motivated to see it through and make the remaining payments. It‘s a way to lock yourself into a purchase and resist the temptation to spend that money elsewhere.
Of course, layaway is not without risks. If you miss a payment or change your mind about the purchase, you may have to pay a cancellation fee or forfeit your deposit. And with no set payment schedule, it can be easy to fall behind or lose track of the item altogether.
For some shoppers, the structure and predictability of Amazon monthly payments or 0% credit card financing may be preferable to the more open-ended layaway process. With these options, you know exactly how much you‘ll be charged and when, and can automate payments to stay on track.
Conclusion
To sum it all up, Amazon does not have a traditional layaway program in the same way some other big-box stores do. The company has experimented with "virtual layaway" ideas, but so far hasn‘t rolled out a full-fledged option to reserve items with a deposit and pay over time before shipping.
However, that doesn‘t mean you‘re out of luck when it comes to affording larger Amazon purchases and spacing out payments. Here are your main alternatives:
-
Monthly Payments: Available for select Amazon devices, you can split the cost into five equal monthly payments with 0% interest.
-
Amazon Rewards Visa: Eligible purchases over $149 made with an Amazon Visa credit card can be financed over 6-24 months at 0% APR, with 3-5% cash back on all Amazon spending.
-
Affirm Financing: If approved, you can finance Amazon purchases over $50 with 3, 6, or 12 monthly installments at 0-30% APR through this third-party provider.
-
Budgeting and Saving: Tools like Amazon Allowance, Subscribe & Save, wishlists, price tracking, online rewards, and coupons can help you save up for items over time and score the best deals.
At the end of the day, it pays to be a savvy shopper and explore all your options before committing to a big Amazon purchase. By weighing the pros and cons of financing plans, monthly installments, and layaway alternatives, you can find a payment strategy that fits your budget and gives you peace of mind. Happy shopping!
