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Cash Is Making a Comeback

Cash Is Making a Comeback, but Will It Last?

It's bad news for retailers, but good for financial health. Cash is making a comeback as the preferred method of payment. Online retailers are particularly troubled by consumers shying away from their credit cards, and according to the founder of Consolidated Credit Counseling Services Howard Dvorkin, "With credit cards, consumers spend 30 percent more (on purchases) than with cash."

Americans have usually gone back to ol' reliable cash when the economy is troubled, like after the Sept. 11 attacks. Dvorkin thinks consumers will return to their credit-spending ways when the economy gets on its feet, saying, "It's hard to to teach an old dog new tricks. Consumers have short memories. When the economy turns around, they'll return to the same old ways."

Do you think consumers will learn their lesson this time around, or will most resume reliance on credit cards when the economy turns around?

Source

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Join The Conversation
Sarana Sarana 7 years
I pasy small things cash, big things with my debit card and internet purchases with my credit card. But there is no debt on my credit card I pay it off every month and even keep an extra amount on it that I receive interest for.
Spectra Spectra 7 years
I use my credit card to buy things, but only because we get a cashback rebate every month for using it. Plus, we pay the balance off every month, so we don't pay interest. I could see how a lot of people get in trouble with credit cards, so I'm glad to see that cash is coming back. I hope people learn their lesson, but I do think a lot of people will go back to their old ways once the economy improves.
cubadog cubadog 7 years
I am definitely a cash only girl. I have really worked hard to change my ways.
gabiushka gabiushka 7 years
So when is the economy going to turn around? Anyone?
sundrops sundrops 7 years
Not to mention pay an extra 6%-20% in credit card interest on their purchases they've already spent 30% more on than they normally would have. That's 50% more! We didn't spend cash after Sept. 11, but we do now for a very different reason - the credit in and of itself. People who don't learn from this experience will at least will know they are destined for failure when using credit, at least with that amount of money, not necessarily in life. I really hope people won't go back to their old ways. This article got me thinking that nowadays every time I use a coupon or buy something I NORMALLY would buy on sale I tell myself I earned blank percent on my money. If I use a coupon I got in the mail for a free meal at a time I would've eaten out any way then I've earned 100% on my money. If I use a $10 off coupon on a $20 item I was buying any way I've earned 50%. If it's a $1 they overcharged me on a $3 item that I bring up at the register that's 25%. These add up to real money. With just those three things I've already earned $19 of my money I've already worked so hard to earn, without any bank's CD. I'm not even counting the credit card interest I'm earning had I put it on a credit card and been paying that amount. That's a stupid tax for me any way, and I'm still paying it on the credit card amount we have left!!
LoveSarah LoveSarah 7 years
I'm sure most people will go back to their old ways, but I know I am done with my credit cards. I don't use cash, I use my debit card instead, but that comes right out of my checking, so I use it like I would with cash.
ilanac13 ilanac13 7 years
well i think that people are realizing a bit more now that they are having a lot of trouble paying off debt and that if they are able to get rid of it, then they will and that's what is keeping them from using cards. i also feel like people are listening to the advice of TV finance hosts who remind us that credit isn't the best way to go right now because of high interest rates.
margokhal margokhal 7 years
I'm a debit/cash kind of girl, so this doesn't affect me personally. Unfortunately, you have to have a credit history for a lot of things [buying houses and cars and things], so having a credit card may be necessary for building that up. Also, it comes in pretty handy when you haven't got all the money right then. That's why people like them so much. Cash won't make a permanent comeback though. It's just more to carry around. Most people are just waiting for the credit companies to loosen up and start lending to people with less-than-perfect credit again.
bsglrok132 bsglrok132 7 years
We're too far gone to have learned our lesson, I think. Everything will go back to the way it was.
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