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Millionaire Corner Asks Investors: Cash or Credit?

Many investors use cash for those under-$5 purchases, but pull out plastic once the total gets past $5.

| BY Kent McDill

Among American consumers, there are some who have stopped carrying cash at all, and there are those who only pay in cash.

But the majority of Americans carry both cash and plastic. The question that comes to mind is “When do you choose to use cash?”

Spectrem’s Millionaire Corner asked investors to detail their purchase habits related to how much their transaction was, and the details show that once the charge tops $5, the plastic comes out.

First, let’s note that according to a study from May, 9 percent of Americans carry no cash at all. Almost 50 percent never have more than $20 in their pocket, and a full 80 percent never have more than $50 immediately available.

“Consumers prefer to pay with plastic, debit or credit or some other type of mobile technology,’’ said chief financial analyst Greg McBride.

However, according to the software firm Intuit, 55 percent of small businesses in America do not accept credit or debit cards for any payment. That covers about 15 million businesses in the country.

According to the Millionaire Corner study, for a transaction of under $5, 55.9 percent of affluent investors would use cash, 34 percent would still use a credit card, and 9 percent would use a debit card. Among the more than 1,000 investors surveyed, a total of five people said they would use a check.

When the transaction total is between $5 and $10, only 33 percent of affluent investors use cash, 52 percent use a credit card and only 14 percent say they use a debit card. By the way, as the transaction total goes up, more investors are willing to pay by check.

When the transaction amount comes in between $10 and $20, cash and debit cards even out at approximately 16.5 percent each. Credit cards are used by 66 percent of investors for purchasing up to $20.

For purchases between $20 and $50, only 7 percent use cash, 18 percent go to the debit card, and 75 percent use their credit card. Between $50 and $100, the credit card will complete the transaction 83 percent of the time, with a debit card being used 12 percent and cash only 2.5 percent of the time.

About the Author

Kent McDill

Kent McDill is a staff writer for Millionaire Corner. McDill spent 30 years as a sports writer, working for United Press International and the Daily Herald of Arlington Heights, Ill. From 1988-1999, he covered the Chicago Bulls for the Daily Herald, traveling with them every day through the nine-month season. He also covered the Bulls for UPI from 1985-88, and currently covers the team for He has written two books on the Bulls, including the new title “100 Things Bulls Fans Should Know And Do Before They Die’, published by Triumph Books. In August 2013, his new book “100 Things Bears Fans Should Know And Do Before They Die” gets published.

In 2008, he resigned from the Herald and became a freelance writer. The Herald hired him to write business features and speeches for the Daily Herald Business Conferences and Awards presentations.

McDill also writes a monthly parenting column for the Herald’s Suburban Parent magazine.

McDill is the father of four children, and an active fan of soccer, Jimmy  Buffett and all things Disney.