Cashless Society: 43 Percent Of Americans Have Gone A Week Without Cash

Could you go a week without spending cash?

Forty-three percent of Americans have, according to a Rasmussen survey released on Wednesday. The convenience of using a credit or debit card apparently is ruling consumer preferences.

But while leaving the house without cash may be convenient, paying with plastic can end up costing you. We tend to spend more when we buy things with a credit or debit card instead of cash, since our purchases become more divorced from the notion of how much they really are costing us.

Notes SmartMoney in a 2010 article:

Studies as far back as 1979 and as recent as 2008 have shown that consumers who pay with cards tend to spend more than those who pay cash. One theory holds that parting with cash is a vivid enough action to elicit a type of psychological pain and that card transactions are too abstract to be painful. In recent years, researchers have also focused on the biological underpinnings of impulse purchases the sensory glee that causes rational shoppers to buy things they might regret later.

When we pay with cards, the clear winners are the banks who collect fees every time you swipe a debit card or credit card. Of course, for those who spend more than they have--there are overdraft fees with which to contend.

Still there are many indications that the world is moving away from cash. Public buses in most Swedish cities do not accept cash and a growing number of businesses and bank offices in Sweden only take cards.

Last month, Canada announced it would cease production of its penny because the coin costs more to produce than it is worth.

In fact, the same can be said about some American coins. Each penny costs 2.41 cents to produce and each nickel costs 11.18 cents, according to the U.S. Mint.

Some business owners have taken it upon themselves to go cashless. Commerce, a restaurant in New York City, stopped accepting cash in 2009.

Low-income people stand to lose the most as cash loses currency. One in 12 American households do not have a checking or savings account, which means no access to debit cards. An increasing number of Americans shut out by traditional banks are turning to prepaid debit cards, which charge high fees. The "unbanked" stand to get left behind by an increasingly cashless society.

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Comments

[NTC Texas]

11:54 AM on 07/05/2012

The future is now! This trend is great news for us in the business of payment processing. The transition won't be easy though, I'm sure.
Read our blog on this topic: Even God Takes Plastic
http://www.ntctexas.com/credit-card-processing-blog/bid/57673/Even-God-Takes-Plastic

[BeltwayInsider]

09:18 PM on 04/14/2012

While many of us could probably move to cashless living without being significantly impacted, how many of us have ever stopped and examined exactly HOW we got to this point in our lives where we can feel comfortable going for extended periods, if not the rest of our lives, cashless?

While I’m no expert in developmental learning, I can’t help but believe that exposure to a physical medium of exchange at a very young age, long before the ability to do abstract math, is a critical part in the learning process of how currency is exchanged for goods and services.

I have little doubt that in a completely cashless society, one in which there exists no physical medium of exchange whatsoever, many, if not most, children would be left completely unable to grasp even the simplest concepts of how trading transpires within our society, and that the lack of that understand at a very early age will lead to financial problems later in life.

I believe the greatly expanded use of credit cards in the last few decades has, in part, led to many of the problems that young adults are now having with credit cards, as we now have the first generation of credit card users who where raised by parents who probably used credit cards rather than cash as their primary medium of exchange. They never saw their parents “pay” for anything – the transactions were all just like magic to them when they were kids.

[HarleyOpenRoad]

07:56 AM on 04/13/2012

Be very wary of a paper trail.

The taxman will assume every check you deposit to your account is income and you'll have to prove otherwise or pay up, if you're ever audited.

[tavvie]

03:13 AM on 04/13/2012

I prefer cash, it let's me remain "anonymous" and no info can be hacked/stolen, etc. And no credit card bill to pay later on!

[Jill Raisbeck]

06:28 PM on 04/12/2012

For me it's easier to tracking spending when I use my debit card for everything. I very rarely ever have cash on me and when I do it's gone in a flash. With online banking/mobile banking I can see every dime I spend and where I spend it.

[itruth]

04:50 PM on 04/12/2012

i will give you this little device that lets you spend money that you don't have and then i will charge you money to use it, to have it, and every month i get to suck some more juice out of you;oh i'm a bank selling you on the idea that i can charge you to use your own money.
Now that is one great job of selling.Checks yep we got those too,good for finding new ways to get at your money.We can sell you some cash at a discount of only 5%.
Ooh [Donuts] mmm good...Marge!

[sjannese]

02:24 PM on 04/12/2012

credit-cards are good for gas, business-expenses/write-offs [i.e./am.-express].

[sjannese]

02:19 PM on 04/12/2012

BULL-SHEET !!.........Ca$h iz King till the day i die !!

[dragondancer1814]

02:17 PM on 04/12/2012

I usually don't have cash simply because we have to pinch our pennies so hard that Lincoln screams and the overwhelming majority of my husband's paycheck (I'm a stay-at-home mom) goes towards such "luxuries" as gas, food, utilities, etc. However, when I do get to get out and run errands, I normally prefer cash. We don't have credit cards because they just get you into hock faster than you can sneeze, checks bounce when you don't want them to (not that stores take them anymore anyway due to the prevalence of ID theft), and we don't like using the debit/ATM card unless it's a genuine emergency. Cash is easy to keep track of and budget, and the only way it'll steer you wrong is if some cretin slips you "funny money." Therefore, that's what I prefer.

[beenzrgud]

12:34 PM on 04/12/2012

Talking Heads, Stop Making Sense

truism on Money...... U.S. money is the worst looking money in the world.

Maybe they think that if it looks bad then people won't want it!

[The Kamala Farang]

12:15 PM on 04/12/2012

I moved to Thailand a couple of years ago and was forced back into the cash society. It's no fun. I have to keep a lot of cash around the house. There has been an increase in stores that accept credit cards but that's just a small portion of spending. It's a great convenience.

[p mersault]

12:13 PM on 04/12/2012

Stop using cards to buy something for $2. It holds up the line and is annoying.

[emerson7]

12:17 PM on 04/12/2012

yeah....write a check instead.

[apans]

12:30 PM on 04/12/2012

stop using cash to buy something that’s $2.11. It takes longer for the clerk to break your dollars than it does to swipe my debit card.

[nomadrdw]

12:10 PM on 04/12/2012

there is that tiny fact that without cash, someone someplace knows exactly what you spend each and every dime on and when.

[Fiberspar]

12:08 PM on 04/12/2012

Yes, because we should give banks and credit card companies even more power-it's been working so well, right?

I'm going only cash.

[apans]

12:31 PM on 04/12/2012

How did credit card companies contribute to our economic problems, exactly?

[bcrice]

10:42 PM on 04/12/2012

Well, they allow people to rack up debt which is precisely why our economy is as screwed up as it is right now.

[berrycuda]

12:07 PM on 04/12/2012

I'm in the majority.
I use cash for EVERYTHING.

I don't want the banks making a dime on MY purchases.
I don't anyone tracking my buying habits unless they start PAYING me for this valuable information.