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All progressive except I'm clinging to dead tree statements. I'm getting closer to the point where I might be able to give those up, but my system is still such that I'm afraid I'll miss paying some things if I don't have a paper statement to remind me. I did finally make sure at work that AT&T stopped sending the 300+ page cell phone bill.
Who the heck carries $200+ in cash? I've only done that a handful of times ever, and mostly I'm going to or from the bank at the time.
I don't buy a stamp to send a card to people because I just mooch one from the other person in the household who sends postcards all over the world.
- Recieve All Bills/Statements in E-Mail/Online Can't -- still need copies for accountant, as we have our own business
- Pays all Bills Online/Online Bill Pay/Debit Card I go one better -- all my bills are paid via autodebit, so I don't have to remember to go online and initiate them.
- Pays for most things with Debit/Credit Yep
- Never carries more than 100$ in actual Cash Nope -- I keep 50 bucks tucked away in case of emergency, and usually have another 50-60 in cash in my wallet, too.
- Has Direct Deposit Nope -- self employed, and my HOAs are still check writers
- Loves the ATM HATE the ATM, so I don't use it
Traditional
- All Bills and Statements are still Paper and Mailed mailed to me, but paid automatically.
- Still buys Stamps I need to send monthly invoices and mail deposits, so yes I still buy stamps
- Writes Checks the only bill that doesn't do autopay is my health insurance.... gotta write one check a month
- Recieves Paper Paychecks No paychecks, just paid invoices.
- Keeps over 200$ in Cash on your person Never that much
- Pays for most things in Cash Never!
- Loves The Teller. Rarely go into the bank -- I mail my deposits in, as my bank is a long drive away....
I used to be progressive, but after getting more and more familiar with the credit card industry, I have come to hate them.
Credit card companies charge high transaction rates to the merchant. of course, everyone wants to use their credit card, so the merchant has to deal with it. These are unknown to you but rest assured, these prices are being passed on to you.
If someone steals your card, you can call up the credit card company and dispute the charge and you will get your money back. Great, but know who eats the money? The merchant.. the credit card company does nothing further to find or prosecute the thieve, they just yank the money away from the merchant, and charge them an additional chargeback fee on top of that.
Companies that accept or store large amounts of credit card information must agree to contracts from the credit card company that impose a large variety of fines in the event that credit card data is stolen or if costly security measures are not implemented.
My company (which is rather small) has spent millions on securing credit card data. If someone were to break this security, we would face steep fines. If someone uses a stolen credit card to pay, they could charge back thousands of dollars and we just have to eat it. You can rest assured all of this is being passed on to the consumer.
All of this, because the credit card companies refuse to implement a system more secure than using a plain-text 16 digit number to access someone's funds. The reason is that consumers are ignorant to the rampant credit card crime and excessive transaction fees and how much more they are paying for their goods because of them, and having to do anything more than swipe their card or punch in a number to authorize will make it too inconvient to pay by credit, causing the credit card company to process less transactions.
This doesn't even get into the fact that consumers are spending money they don't have.. changing the market into one where purchasing on credit is expected and almost required.. and then getting raped by the credit card company after they have loaded up on debt.
The thing is if you pay cash, in most cases you are still contributing to the credit card industry through higher prices, and just not getting any of the benefit.
The thing is if you pay cash, in most cases you are still contributing to the credit card industry through higher prices, and just not getting any of the benefit.
That's a selfish way to look at it, but that's exactly how we get into these kind of situations.
How is that benefitting the credit card industry though? No, you won't get a lower price, that day, but the "extra" money will go to the merchant rather than the credit card company. And, you would have to assume most business are going to look at their margin when pricing after considering operating costs which would be lower if they had less transaction fees to pay.
I have seen gas stations attempt lower prices for cash paying customers, but unfortunately they always seem to revert back to one price.. I guess customers don't like this?
You say selfish, I say practical. As just one customer, it doesn't matter what I do--the merchant is still going to have to cater to the rest of their customers, and if the rest of them want to pay with a credit card, then that is what will continue to happen. I guess you could make a case for giving the merchant a little gift of extra margin as an act of charity, but I don't see merchants as being the best candidates for charitable contributions. In any event, since money is fungible, you can't really trace the contribution to the credit card companies to each individual transaction--all the customers paying higher prices are collectively contributing funds to the credit card companies, whether they personally use a credit card or not.
But don't get me wrong--I'm not happy with the status quo. But the way forward will have to be cashless alternatives to credit cards that are even more convenient, because there is no way to get enough customers to go backward to cash on a sufficiently large scale. For example, there is no particular reason why banks and cellphone companies couldn't collaborate on cutting out the credit card companies--but the question would then be whether merchants and customers would actually be any better off.
My understanding as to why cash discounts tend not to work well is that customers who tend to pay with credit get mad at paying a higher amount. This isn't entirely rational on their part--if more cash transactions means lower prices for everyone, then they are still coming out ahead. But apparently not enough customers see it that way.
You say selfish, I say practical. As just one customer, it doesn't matter what I do--the merchant is still going to have to cater to the rest of their customers, and if the rest of them want to pay with a credit card, then that is what will continue to happen. I guess you could make a case for giving the merchant a little gift of extra margin as an act of charity, but I don't see merchants as being the best candidates for charitable contributions. In any event, since money is fungible, you can't really trace the contribution to the credit card companies to each individual transaction--all the customers paying higher prices are collectively contributing funds to the credit card companies, whether they personally use a credit card or not.
But don't get me wrong--I'm not happy with the status quo. But the way forward will have to be cashless alternatives to credit cards that are even more convenient, because there is no way to get enough customers to go backward to cash on a sufficiently large scale. For example, there is no particular reason why banks and cellphone companies couldn't collaborate on cutting out the credit card companies--but the question would then be whether merchants and customers would actually be any better off.
The same case can be made for voting, right? What one person does makes little difference?
However, you are probably right that it is a little idealistic to think that simply educating folks will make a difference, regardless of how maddening I find it to be that Mastercard and VISA are controlling our currency and sticking their hand in the cookie jar everytime a transaction made.
While little alternative exists for online transactions currently, I guess I don't really see how cash is inconvenient.. I hand over the cash and the person gives me the change, and I am done. With credit, I can't tell you the number of times a pizza delivery guy or bartender has added a buck or two to my tip.. or just plain punched the transaction amount in wrong. Most people probably don't balance against their statement, I guess, or even know how much money they have spent. You also have to worry about folks stealing your card number when you hand it over to them. Sorting out stolen transactions certainly isn't efficient use of my time.
With credit, I can't tell you the number of times a pizza delivery guy or bartender has added a buck or two to my tip.. or just plain punched the transaction amount in wrong. Most people probably don't balance against their statement, I guess, or even know how much money they have spent. You also have to worry about folks stealing your card number when you hand it over to them. Sorting out stolen transactions certainly isn't efficient use of my time.
My oldest CC dates from 1976... so I have been using credit a LONG time!
I have NEVER had a pizza guy or bartender add to the bill or punch it in wrong.
I have NEVER worried about anyone stealing my card number.
Soooo... I have never wasted any time using the CCs and getting any perks that come along with them. Like Brian says, it is practical to use a CC with the way the system is set up.
The same case can be made for voting, right? What one person does makes little difference?
Well, sorta: your vote probably won't decide any elections, except maybe in small local races. But voting is a political act, not an economic act, and I think has to be evaluated differently. For example, even in an election your preferred candidate loses, your vote contributes to the public record of political support for that candidate. In contrast, paying with cash instead of a credit card doesn't have any such implications.
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However, you are probably right that it is a little idealistic to think that simply educating folks will make a difference, regardless of how maddening I find it to be that Mastercard and VISA are controlling our currency and sticking their hand in the cookie jar everytime a transaction made. While little alternative exists for online transactions currently, I guess I don't really see how cash is inconvenient.. I hand over the cash and the person gives me the change, and I am done.
You are skipping the steps where you actually have to arrange to have enough cash with you at the time of the transaction. That is the most inconvenient part. You can educate people all you want, but not having to either carry tons of cash around with you or make frequent trips to ATMs is a big convenience for many people.
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With credit, I can't tell you the number of times a pizza delivery guy or bartender has added a buck or two to my tip.. or just plain punched the transaction amount in wrong.
This almost never happens to me, and of course when people do cash transactions, they can make mistakes (or commit fraud) too. In fact the statistics show the overall error rate for cash transactions ends up much higher than for credit card transactions.
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Most people probably don't balance against their statement, I guess, or even know how much money they have spent. You also have to worry about folks stealing your card number when you hand it over to them. Sorting out stolen transactions certainly isn't efficient use of my time.
And people can mug you and take your cash. It is also much harder to get your cash back if you think there has been a mistake or fraud.
The bottomline is that people are obviously choosing what they feel is overall the most convenient and secure method of payment, and for transactions about minimal amounts, these days that is overwhelming electronic transactions. So again, to really provide an alternative, it will have to be electronic and at least as convenient (if not more so).
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