Retail Financing Requirements

The range of retail financing requirements is much narrower than for cor porations:
Homes. Many people, for a number of reasons, aspire to own their own home whether it be a castle in the English countr yside, a condo in New York or a semi-detached house in suburbia. Financing for such purchases is long term in nature and usually paid for from the income of the occupier or occupiers.
Automobiles. Automobiles are usually second only to proper ty in terms of retail big-ticket acquisitions. These are depreciating assets and most owners look to pay off any financing they obtain within three to five years.
Seasonal. While an individual’s behavior may be impossible to predict with any cer tainty people as a whole still tend to act as a herd. Spending on many goods rises in winter as people go out to buy carefully chosen gifts for their loved ones and socks and chocolates for their other relatives. Spending on vacations peaks in the summer months as the masses head for the beaches. During the rest of the year people either save for their next holiday or work to pay off their last.
Consumer goods. White goods such as washing machines and refrigerators have now become so cheap that their cost relative to income has fallen shar ply. Most men love toys, however, and there is always the next generation of mobile phone, personal digital assistant, plasma screen or home enter tainment system to salivate over. Many women are fashion victims and this may help to explain why the smaller bikinis become the more they seem to cost. These types of purchases are often made on a whim and have to be paid for either from savings or by borrowing. Real consumers would need a dictionar y to find out the meaning of the word savings. And such people are easy prey for predators such as unscrupulous finance companies and banks.
Occasional. Cer tain events, weddings and medical emergencies are good examples, occur infrequently but may require significant outlays. The timing of such events cannot usually be predicted well in advance.
Education. Most students have to pay for ter tiar y education. Financing is usually provided by a combination of parental contributions, income from par t-time or summer jobs and long- term education loans.