Personal Finance

More consumers using credit cards for purchases under $10, though cash is still king

Key Points
  • Among U.S. adults, 16% say they use credit cards for totals under $10, according to a new survey data.
  • For consumers with rewards credit cards, that share is 26%.
  • U.S. consumers' revolving debt is above $1 trillion, and roughly 60% of cardholders do not pay off their balance monthly.

While about half of consumers still use cash for small purchases, many are turning to credit cards.

Among U.S. adults, 16% say they usually pay with credit cards for totals under $10, according to new survey data from That's up from 12% who said the same in 2018. Among people who have credit cards that come with rewards — i.e., cash back, miles or points — the share is 26%, up from 23% last year.

"We've seen a steady decrease in cash and an increase in credit card use for small purchases since 2014," said Ted Rossman, industry analyst for

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The data are based on an online survey done in July of more than 2,500 U.S. adults. From 2014 through 2017, when the annual poll defined a "small purchase" as one under $5, the share of consumers preferring a credit card for those buys also rose to 17%, from 11%.

Roughly half of all survey respondents (49%) prefer cash for purchases under $10. Among those with rewards credit cards, the share is 43%. About a third of both groups — 35% and 31%, respectively — report using a debit card as their go-to choice for covering those small buys.

Collectively, U.S. households owe $1.07 trillion in credit card debt, according to June data from the Federal Reserve. While the amount edged down slightly from May, it has been trending upward since 2011.

"Unfortunately, not enough people are paying their bills in full," Rossman said. "Sixty percent carry a balance month to month.

"That's expensive debt."

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The average interest rate on credit cards is close to 18%, although consumers with poor credit might pay more in the neighborhood of 25%, Rossman said.

Among survey respondents, 57% said they have rewards credit cards. While using them for small purchases can help rack up cash back, miles or points, not paying the balance in full each month can cancel out the benefit of the rewards due to the interest tacked on to your balance.

"The most important thing is to pay the balance in full before interest accrues," Rossman said. "If you can do that, then by all means go for the rewards.

"But if you carry a balance, forget about rewards and think about the interest rate first," he added.

If you carry a balance, forget about rewards and think about the interest rate first.
Ted Rossman
Industry analyst at

If credit card debt is weighing you down, it's worth exploring lower-interest options. Depending on your credit score, you might qualify for a card that comes with a zero-percent balance transfer offer. In that scenario, you would pay a balance transfer fee — 3% or so — but pay no interest on the amount transferred for a set amount of time.

You also could look at personal loans, which might come with a lower interest rate than you're currently paying. The range is from about 4% to north of 30%, depending on factors including the amount, the length of the loan and your credit history.

And, of course, cutting expenses or earning extra income are ways to try coming up with extra cash to throw toward the balance.

"Credit card rates are so high right now that paying off your credit card debt needs to be a major priority," Rossman said.

Meanwhile, the top reason that survey respondents gave for preferring cash for small purchases was that it's easier or quicker (40%). Other reasons included concerns about credit card debt (24%), stores having credit card minimums or fees for small purchases (14%), no incentive (11%) and "it's rude" (5%).

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