73 Comments

  1. Chak: In general [*], if you’re contracting for goods and services, you can state what you’ll accept for your goods and services however you want. So you can say that you’ll only accept chickens, or interpretive dances, in payment. OTOH, as CaroZ says, there’s a difference if you’re paying and existing debt, and there weren’t specific requirements on how the debt had to be paid back when you incurred it.

    [*] Many exceptions apply.

  2. Andréa: I have YET to see a place that offers a 6% lower price if you pay cash.

    Doesn’t any place that charges you fee for using a credit card therby offer you a lower price if you pay cash?

  3. In all my years of using credit cards (I think my first ones were chiseled in stone), I’ve only ever seen ONE place that charged more for using a credit card. AND that was before that restriction was lifted.

  4. Most of the places that I have heard of that didn’t take have been fast-casual restaurants with high customer volume. They claim that there is significant time saved with cards only.

  5. re: paying more for using a credit-card/less for paying with cash

    In my experience, the first to go with an expressed difference in pricing were gas stations. They weren’t allowed to charge more for accepting a credit card (because of the merchant agreement) even though the cost of accepting credit was significant. But they figured a cash discount was OK under the merchant agreement.

    Many stores resolved the problem (a cost of 2-5% on credit-card sales) by not taking credit card payment at all. The banks fought this by creating the debit-card system, with a lower cost charged to merchants (because the customer had funds available to pay, so no risk of the end of the month coming and the customer saying “no check for you this month, maybe next month?”) They got debit-card terminals installed in a lot of places that had declined to take credit, and then piggybacked credit-card services on top of the debit-card services. So grocery stores and fast-food restaurants, which previously declined all credit card sales, now generally accept them.

    Credit card reward programs (whether they give you money on account, or airline miles, or whatever) are funded by the fact that the merchant pays the credit-card company a percentage of all sales made by credit card. People who pay cash are effectively paying more for products and services to fund these programs. On the other hand, their end-of-the-month financing fee is 0 x prime rate + 0%. Yes, you can get the same rate from your credit card company… IF you can pay the entire balance every month. Americans are notoriously poor at achieving this goal, as a whole.

  6. And they save even more time by not having to serve me, since I’m not about to eat in such a place.

    There was a “food hall” in St. Paul that opened three or four months ago with that “no dirty old-fashioned actual cash accepted” policy. It closed a few weeks ago.

  7. I remembered reading somewhere that there was a law against refusing cash. Turns out I was remembering an article about a law introduced in 2018 banning cashless restaurants in DC. And I don’t even know if the law passed.

    But I did just learn that 5% of Americans are unbanked, and 18% are underbanked, meaning they don’t have debit cards or credit cards.

  8. Andréa – we do the same with our credit cards. I don’t know about a roof, but we did put our fence on a card. Also had a general credit card whose “points” were towards the purchase of a vehicle from a major car mfgr whose vehicles we normally bought. Thinking quickly as we bought a car, I asked if we could charge the downpayment – so those points went towards the car also.

  9. Powers – yes, there are that many people who cannot make change. We eat lunch almost every day at a local Wendys (makes husband feel like he is going to office every day – I don’t get it, but it makes him happy). We buy the same meal every day. Until a recent price increase, it came to $3.23 for the two of us. Every day he would make sure he exact change or $3.25 to pay them with. (I drew the line at charging this daily.) I asked why – it seems that the employees have trouble making change and he has to tell them what to give him. This is despite the fact that their register will calculate the change. Problem is that every employee enters the amount of the sale as the amount given to them so it does not show the change. I did not believe him until his shoulder last October and I had to buy our lunches (while he did my job of getting a table) and they had the same problem and always entered the amount of the sale as the amount received.

    I will post another story about making change later in my posts.

  10. Brian in STL – it drives Robert crazy keeping track of which card to use for which purpose to maximize points. He had me make tapes (from Brother tape machine) to put in his wallet with which to use for what – and when I go for the 5% for a quarter I have to tell him and make him a tape. (We have three basic cards we use. We have one credit card with a very low maximum allowed line – at our request – which is only used on for online/mail/phone purchases. Then we have 3 cards we use once a year for as cheap a purchase as we can find (say $1.50) to keep them active.)

  11. Andréa – My first job that was not working for my dad started in my second year in college at a supermarket. House brand of bread came in 2 sizes – 4/$1 and 3/$1, so yes, bread was 25c a loaf for the small loaf. I remember no other prices other than those two.

    We could not ring up an item for more than $9.99 – what could possibly cost more? The occasional large holiday turkey or such had to be rung up for $9.99 and the the difference between the price and same calculated and the item rung up again for same.

    No scanners – they had just invented the “coupon” key. Customers were not used to same and would argue with us. “I gave you a coupon for 10 cents off that item and you did not subtract it.” (Think about the math of subtracting the coupons before ringing up an item). “Yes, ma’am. I have to ring the item at full price and then at the end I will ring up the coupons with the coupon key and it will subtract the amount of the coupons.” (and I had to manually enter the amount of each coupon of course).

    No credit cards in supermarkets. Checks though were probably more commonly used than I imagine they are now.

  12. Arthur – I don’t think it was against the credit card rules. In NYS it was illegal to do so.

    In the 1970s gas crisis this was a big deal as the rule was that a gas station could offer a cash discount price, but not charge a premium for using ones. When the more recent high prices they seem to have forgotten this law and gas stations started with cash only – followed by cash/debit card only pricing. We always make sure that the station we go to does not charge extra for using a credit card.

  13. Andréa – you are lucky – Robert won’t go shopping without me. He needs a package of 5 screws at Home Depot – I have to go along with him. Ask him to buy something on a day I have to work – I get hemming and hawing and “do I have to?”.

  14. James Pollack – in all the decades that husband and I have had credit cards – separately before we were married and joint also since we married, we have only not paid our credit card in full – ONCE.

    We used to get his unused sick pay in September if he did not use it. So at the beginning we filled the allowable bank with the days he did not use, but then each year we asked for the days after the end of the year (they were on a school year basis in general). Since we went on vacation in August we used that money to pay the vacation bills and then left the rest of what was received in our savings account. One year there was some problem and the sick pay was not coming until October – but we had to pay the credit card bill. it was an odd time when our savings account rate and the credit card rate were not that far apart, so we decided to pay half the bill and pay the other half plus any new charges the following month in full – and did so.

  15. Chak – this is coming up in several states- at least in the NE US. Stores are refusing to take cash. There are people who do not have bank accounts or credit cards and have a problem with same and the states are passing laws that cash has to be accepted.

    On another list I am on, with people not as intelligent as those on this list, I was told when this subject came up, that EVERYONE uses credit cards – “even panhandlers take credit cards these days” !

    We use credit cards as much as we can. We carry cash – and will carry more cash when we go out of state. However, if we use the credit cards – we don’t have to pay until next month, we don’t have to worry if we have enough cash with us, we don’t have to worry about losing a large sum of cash or having it stolen, I know where the money went (Robert, what did we buy that would be listed as REtqb sv23? – made up the designation), plus we get the points back against the account balance. I normally call as soon as I get a statement with our points higher than minimum to redeem – once I was juggling to cover the credit card bill (we have months like that these days and I don’t want to take out IRA money if I don’t have to) and I called for what I thought was $25 credit from the points. Turned out I had forgotten to call for same and it was $250 – paid so much of the statement that I had overpay it to pay the minimum amount in addition.

  16. Meryl,

    I find that if I pay cash everywhere, I spend less. Impulse buying is to a minimum because I just don’t have the cash on me. I do have a credit card in case there’s something I really do need, tho.

    I have noticed that people pay closer attention to cash, and how much they’re spending. For instance, sometimes when I helped a student do research in the library, they had to feed dimes into the copier. They got very stingy with the dimes, but when I asked how much they’d pay to have someone just find and copy all the articles for them, they’d tell me amounts that would have covered hundreds of copies. There’s just something about forking over money that makes us cautious.

    The only things I pay by card are online purchases and gas.

  17. Chak: What I meant was that the fact that cash is “legal tender” doesn’t impose a general requirement that every business accept it. But specific municipalities can and have made such requirements.

  18. I’m sure some people do spend more with credit. I don’t. I have a wicked frugal streak. “Impulse buying” doesn’t happen for me. All purchases, no matter how small, are carefully considered. The form of payment does not enter into the consideration. Price is usually, but not always, involved.

  19. They got very stingy with the dimes, but when I asked how much they’d pay to have someone just find and copy all the articles for them, they’d tell me amounts that would have covered hundreds of copies.

    Your analysis is faulty because you are equating the cost of copying with the cost of having someone else locate and copy the articles. You are not factoring in the time for the extra activities. Would people have spent more on copying if the copier took credit/debit? How would you know?

  20. Chak – I understand what you mean. One reason road tolls in the northeast US have been rising at the rate they are is that people pay them with EZPass (transponder on the windshield to an account) and not in cash so every two months one is billed for the tolls – I used to know the toll from every place in PA and NJ that we would go – now I am shocked to find out how much they are when I look at the statement – and PA managed to split off the turnpike toll – at the same rate from/to the eastern end as before, while adding a new toll for the Delaware River Bridge in addition (before covered in turnpike toll).

    I also understand that children in particular need to see and use cash to understand the concept of money and that it has a value in that it can it be exchanged for something to understand the value of same. (Niece when she was maybe 4 or 5 to my mom – “Grandma I want that.” “I don’t have enough money.” “We can stop at your bank and get more.” And she is the niece who actually as an adult understands the concept of money.)

    We plan our purchases (well, except for the $4000-$5000 in car/RV repairs we have gone through in the past month and a half and other emergencies) in advance, even small ones. It is extremely hard to get me to buy something that I have not though over and over – even for $2, whether it is cash or credit. If something catches my eye – and it will be generally under $5, Robert will keep walking me past the item until he can talk me to into spending the money to buy it. There are places we pay in cash and make sure we bring extra, such as at farmer’s markets when go in PA (one gift vendor that I have bought bear figurines from, if I am buying a few of them – she has ones from a collection I have – I will always offer cash if she can do better on the price and she does.)

    But for everyday and large purchases, it is credit card. I don’t have to worry about enough cash. I don’t have to worry that I lose the cash or it stolen. I also am the sort of crazy person who likes to know where the money went – credit cards help a lot with that. (Several years ago I came across a columnar book that I used to keep track of cash spent while in college. It was really interesting to relive the year by going through it and I realized it was from the year we started dating – first Broadway show we saw together was in the book (I was the sort of girl who rather pay my own way than not do something we wanted to do as it was too expensive for him to pay – such as the $3 for the Broadway show ticket – for both of us). But, every week there is an adjustment for “?”. That is gone with credit cards. Now it is just a question of what the abbreviations on the receipt mean – especially when Robert bought the item.

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