What’s In Your Wallet

You are at the checkout stand.  How do you personally pay for your purchases?  You reach for a credit card or a debit card or cash or check or  electronic payment, such as a mobile wallet or wearable?

The Federal Reserve Bank of San Francisco’s 2018 Findings from the Diary of Consumer Payment Choice (DCPC) found participants preferred to pay using debit cards.  The order of payment preference was like this:


Payment Type Preference
Debit cards 42%
Credit cards 29%
Cash 24%
Check 2%
Other methods 2%
Pre-Paid 1%


Here is an interesting side note.  The more money a household earned, the more likely they were to pay by credit card.


 HH Earnings Credit Debit Cash
$25,000 – 49,999 13% 29% 36%
$50,000 – 74,999 19% 31% 27%
$75,000 – 99,999 21% 29% 31%
$100,000- 124,999 30% 23% 24%
$125,000 or more 33% 21% 24%


If you use credit cards and do not pay down the balance each month according to Nerdwallet’s American Household Credit Card Debt Study reported, ‘Households with revolving credit card debt will pay an average of $1,141 in interest this year.’

For example if your retirement is 10 years in the future, saving $1,141 a year, and earning 6% annually on the money, could provide about $16,000 in additional savings.  If retirement is 30 years away, you could increase your savings by about $96,000.  Think again when you reach for your wallet.