The Rent-to-Own Trap
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The Rent-to-Own Trap

Avoid paying too much for your stuff ...

 
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The Rent-to-Own Trap
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You see a TV set at the rent-to-own center that you like. It's a big-screen version, complete with high-definition capabilities and a remote control that looks like it belongs at NASA.You must have this TV. The rental center will deliver and set it up in your living room for 20 dollars per week. You happily sign the contract and give them your address so that the delivery crew can bring your new merchandise home. But every week, you have to give them 20 dollars. This doesn't seem like much at first, but that's 20 bucks - 80 every month, actually - that you don't have to spend on other things. Eventually you realize that you could have gotten the TV much cheaper had you gone anywhere but the rental center.

Before you sign any agreement with a rental center, you should think about what you're really paying. You'll usually realize that you're being scammed: paying twice, if not more, than what the items are really worth.

Do The Math
Multiply the weekly payments - including taxes, warranty charges and any other weekly fees - by four. That's your monthly payment. Now multiply that number by the number of months in your contract. Typically, you'll make payments from 12 to 24 months. This final number is the total of what you'll pay for the item in question. If you buy a refrigerator that "only" costs 15 dollars every week, and you pay for 24 months, that basic fridge is going to cost you 720 hard-earned dollars. In reality, that model is probably worth about 500, if that much. You can find similar refrigerators elsewhere for even less than that in many cases.
You're paying for the convenience of making small weekly payments instead of either putting the item on a credit card or paying cash up front. Rental centers entice potential customers with boasts of the seemingly-tiny weekly payments: fail to add everything up and you could be suckered into thinking that it's a good deal.

Practice Patience
Unless you really need the item, save your money until you can pay cash. Your teenagers insist that they'll drop dead if you don't get the big-screen TV today, but they'll live - and so will you, even if you have to listen to their complaints.
Saving up to pay cash inevitably costs less than renting to own. You'll have to wait longer in most cases, but patience will pay off. You can use the difference in prices - what you paid in cash versus what you would have paid if you'd rented to own - to buy a new DVD player or other accessory to go with the TV set.
And saving money for the purchase won't be very difficult if you put back the same amount that you would make in rental-center payments. When you receive your paycheck, tuck away the money that would go to the rental center.

Make Do With Used
Your washing machine might be dead, but that doesn't mean you have to rent-to-own a new one. You can get another washer without being scammed out of hard-earned money.
Find an appliance in the classified ads and pay cash. You might get a good machine for 50 dollars or less. Now that you can wash your clothes again, start saving money for a newer and better machine. You'll pay less than if you rent-to-own and you won't suffer in the meantime.
Word-of-mouth is another great way to find appliances cheaply. Someone in your town or city inevitably knows a person who needs to get rid of a still-working appliance. In some cases, you might even find a man or woman who's happy to give the washer, or whatever, away just to get it out of the house.
If you can avoid rental centers, you'll save quite a bit of money in your lifetime. When you're tempted to sign a contract, stop and think about how much cash you're really giving the center, then go somewhere else to find the same thing cheaper. (don)
 
 
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