Nearly one in 10 Americans no longer carry any cash at all — and nearly half carry less than $20 in bills daily — financial analysis company Bankrate.com said in survey results released Monday.
The results signal a substantial decline in the reliance on cash for transactions. With so many alternatives such as credit cards, debit cards and mobile phone payment apps, the traditional method of payment is fighting for its space in the American wallet.
Nine percent of those surveyed said they do not carry any cash at all, while 49 percent said they carry less than $20 a day and almost 78 percent said they keep less than $50 on them. The survey report also said women tend to carry less cash than men, although it is not clear why. The amount of cash people carry is fairly consistent across both age and income groups, according to the survey.
Only 7 percent of those surveyed said they carried $100 or more per day.
“There’s a migration away from cash toward plastic, and even mobile devices as a method of payment for routine transactions,” said Greg McBride, Bankrate.com’s chief financial analyst.
“There are some drawbacks to carrying cash, and some incentives to use other methods of carrying different forms of payment,” he said. “Cash makes you a potential target for theft and if you lose that money you’re out. The other thing is credit card reward programs incentivize consumers’ use of cards for routine transactions.”
Still, analysts said cash won’t be disappearing any time soon.
“There are certain transactions where cash is really the only option – whether it’s feeding a parking meter, tipping a valet, or even in the situation of when you get in the taxi cab and you find out the card reader is broken,” McBride told Al Jazeera.
“Some people feel a little more responsible with the cash because they feel a little bit of pain when they part with the cash,” he said. “Other people, the cash burns a hole in their pocket.”
While most consumers are not carrying much cash, it still accounts for more 40 percent of transaction payments, and it is frequently used for purchases that are less than $10.
“My sense is that cash will remain king, at least for a while,” Gail Cunningham, spokeswoman for the National Foundation for Credit Counseling, told Bankrate.com.
The survey consisted of 1,002 adults who were interviewed over the phone by Princeton Survey Research Associates International.
On other money matters, the survey report said that net worth is now the strongest indicator of financial security, as only one in six people surveyed reported having a lower net worth now than last year, with the rest either maintaining or increasing their net worth.
However, more Americans are afraid they could lose their jobs this year. Only 18 percent of those surveyed said feel secure in their jobs, a decline from last year's 24 percent.
Those who feel uncomfortable with the amount of money they have saved outnumbered those who feel like they have enough by a two-to-one margin, and May is the second month in a row and the forrth in the past year in which Americans feel less comfortable with their debt compared to last year, the survey said.
In terms of their overall finances, Americans are split; 25 percent say they are worse off now compared to last year, 25 percent say they are better off, and the remaining half say their financial situation is the same as it was last year.