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There is a malady afflicting America today. It’s called “got-to-have-it-now-itis” and there are a number of places available to attend to the problem. Those places are typically referred to as “rent-to-own” outlets.

Today, there seems to be no patience to acquire the things that make a home more livable and so, if you can make smaller monthly or weekly payments, you can have these items in your home right away.

It wasn’t so long ago that there was a methodology called “layaway,” and for those familiar with it, it simply meant that you could make up-front payments on something you wanted or needed, and when your payments amounted to the purchase price of the item, it was yours.

This methodology worked well for decades, and taught people to not only be frugal but to understand that something worth working toward and waiting for was more appreciated. It’s interesting to note that at least one major national chain has re-instituted layaway.

Here’s the problem with rent-to-own. If a person pays the rental fee on an item for the full term of the agreement, he or she will be paying about twice what the product would have cost had they been able to purchase it outright or to buy it through a layaway plan.

A recent advertisement for a rent-to-own company listed a mini-notebook computer made by a major manufacturer. The rent-to-own price was listed at $59.99 per month, and the renter would own the computer in 12 months. This 12-month lease would result in total payments — less any other fees that might not have been mentioned in the ad — of $719.88 or … one could buy it outright from the rent-to-own company for $539.99. A sizeable savings if one could come up with the funds for the purchase. Of course, were one able to surf the Internet for this computer (perhaps at the library) one would find that the same item could be purchased at a major office supply store for $350.

In the same ad, a well-known computer manufacturer’s notebook computer is available for a 12-month lease of $99.99 (Wow! That’s not even $100) and the payout for ownership would be $1,199.88. To show that the rent-to-own store is a great place to buy this computer, one could have it to own immediately for only $899.99. Or one could put $99.99 in the cookie jar for five and a half months and then purchase the computer directly from the manufacturer for $549.

Ironically this $549 is almost exactly half of what one would pay to rent the device for 12 months and then own it.

Here’s another example. A 47-inch LCD TV is available to rent for $99.99 (why they like these 9s so much is a mystery) for 24 months, resulting in a payout of $2,639.74 (this includes an extra service agreement plan). The rent-to-own retail price is $1,499.99, but the same TV is available at a major retailer for $979.99, a whopping 35 percent savings.

Everyone should realize that rent-to-own businesses have to make money to stay in business, just as every other enterprise does. But these prices would appear to be as usurious as the fees charged by payday lenders.

The really unfortunate thing about the rent-to-own concept is that it seems to target those who are least able to afford to make major household purchases and those who are least likely to have had any exposure to advice on sound financial planning.

Still, a driving force that keeps these businesses going is the desire of so many people to experience instant gratification and an unwillingness to save for the important things in life. If more people could be exposed to some degree of financial planning, perhaps the rent-to-own fad would simply die on its own.

Contact Chuck Witt at chuck740@bellsouth.net.

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