BY KAVITA KUMAR

ST. LOUIS POST-DISPATCH

ST. LOUIS, Mo.

Unlike paying with credit cards, where you get your hands on an item now and pay later, with layaway you make interest-free payments on a product that you only get once it's paid off.

On the surface, layaway also doesn't always make the best financial sense. After all, it would probably be better to save the money yourself--accumulate interest even--and not have to deal with upfront or cancellation fees of layaway programs.

But Haim Mano, a marketing professor at the University of Missouri-St. Louis, notes that people don't always behave rationally.

"You could save the money and put it in the bank," he said. "However the psychology here is different. People want to make a commitment and feel that the product is yours."

He added that layaway can be a form of self-imposed self-control for consumers who might otherwise be tempted to spend that money in other ways.

It's not so different, he said, from putting the alarm clock farther away from the bed because you know if it's too close, you'll just hit the snooze button.

Besides, people often overspend beyond their means when they pay on credit cards, he said. That's a risk with layaway, too, but at least people don't put themselves at risk of high interest payments

Layaway, dating to the days of the Great Depression, was a popular tool in the 1960s and 1970s when credit was hard to come by. But it began to disappear in the days of easy credit.

That has all changed in the last few years since the Great Recession with many retailers bringing back or expanding their holiday layaway programs. And this year, many of the big guys have been sweetening the deal.

First, Walmart started its holiday layaway program a month earlier in mid-September to give consumers more time to pay for their purchases and the retailer also expanded the list of eligible items. Then Toys R Us announced it was waiving its upfront $5 service fee on layaway orders made by Oct. 31.