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The method of buying large ticket items with a small deposit and instalment payment plan was a feature of the 1920's. Previously only the wealthy could afford to pay cash for items like pianos, phonographs, radios, fridges, vacuum cleaners, and washing machines.
In the 1920s, assembly line production and easy credit made it possible for ordinary Americans to purchase many new consumer goods.
Many critics of the instalment system asserted in 1925–26 that the rapid spread of this method of merchandising was producing an over-expansion of credit and giving an unhealthy stimulus to trade, ...
In the 1920s, the items people could purchase with an installment plan included: automobiles, automobile parts, household appliances, radios, phonographs, pianos, and furniture.
The 1920s was a decade of increasing conveniences for the middle class. New products made household chores easier and led to more leisure time. Products previously too expensive became affordable. New forms of financing allowed every family to spend beyond their current means.
Although effective, installment plans created a cycle: defaults would happen on the plans, so then there would be a shortage of money for the production of goods installment plans were used on. By the end of the decade, installment plans had spread to other parts of the economy, such as banking.
Companies decided to use advertisement to change public perception. By the 1920's almost everyone was using installment plans. The installment plan enabled people to buy goods over an extended period of time, without having to put down very much money at the time of purchase.
