How Americans Use Credit Cards



The prevalence of credit cards in today’s society may seem jaw-dropping at first. Given the roller coaster fluctuations our economy has experienced since 2008, it seems strange on the surface that so many people are using plastic to cover their expenses and make their impulse purchases.

That being said, our relationship with cold, hard cash has gone increasingly sour. For one thing, it is inconvenient and even dangerous to carry large amounts of it around. Further, making purchases with it makes returns and exchanges more difficult. Finally, credit and debit card companies send monthly statements that enable us to keep track of what we have bought.

What Do People Use Their Credit Cards To Buy?

We use our credit cards to pay for many daily essentials. These include food, gas, travel and medical expenses. For the most part, these are ongoing costs for products we would have a hard time doing without. In the case of doctor and hospital bills, they can often require more money than most of us have on hand at any given moment, making payment over time on a card the only option.

In addition to items that are most commonly purchased with cards, you should consider using plastic in other specific ways. Take out your Mastercard, Visa or American Express when you need to buy large appliances since your card provider will probably offer you a complimentary extended warranty, purchase protection and even price matching. It is also recommended that you use a credit card for any expenses you plan to deduct from your taxes. These could include charitable donations, business costs, education and child-care. Just be sure that you can produce your credit card statement when tax time rolls around. Finally, consider using your card when purchasing items or services online since it offers fraud and identity theft protection.

Where Do People Use Their Credit Cards?

Credit cards and online shopping go together like a hand in a glove. When you use plastic for e-commerce buying, you are protected to a large degree from identity theft and fraud because of the safeguards put in place by your credit card provider. In addition, there is a built-in shield for your sensitive bank account information that keeps the merchant and anyone else who might be unscrupulous from accessing it.

People enjoy the convenience of using plastic at department stores as well as for food shopping. Today’s EMV cards have an added layer of security, encrypting payments and markedly reducing the likelihood of criminal activities such as cloning and identity theft.

How Much Are People Spending On Credit Cards?

Credit cards are quickly replacing cash, especially when it comes to the larger purchases people can’t make with pocket change. Therefore, it makes sense that the average credit card purchase in the U.S. is $76 and that the average business card transaction is $179. No doubt, the 31.4 billion transactions with plastic in 2015 is a number that will only rise over the next few years.

Is Credit Card Spending Seasonal?

For numerous businesses, the last two months of the year are their bread and butter. Without the extra boost that holiday sales give, many of these companies would not survive. It stands to reason that cash-strapped consumers often use their cards to buy gifts for their friends and families, with card usage increasing the closer it gets to Christmas.

Once the holiday season is over, consumers seem to spend the first three months of the year paying off their bills, with credit card purchases dropping appreciably. From April on, there is an uptick, with August showing as the third highest month for card purchases. No doubt, this is due to the many items that are required when students return to school.

Coping with an ongoing credit card balance has become the norm for millions of Americans. Those who reside in Alaska and Washington, D.C. are especially burdened because the areas where they live have very high costs of living. Michigan, Wisconsin and Mississippi residents are blessed with the lowest amount of debt. This phenomenon could be due to factors such as low energy costs and real estate values as well as geographic location.

Which Credit Cards Have The Most Debt?

When shopping for a credit card, there are many factors you should take into consideration. These include annual percent rate, fees, minimum repayment, introductory interest rates and loyalty features. In addition, you might want to consider which card providers lead to the highest debt in their patrons: Chase, Bank of America and American Express in that order.

Who Provides The Most Credit Cards?

Of course, you don’t choose a credit card solely based on popularity. Primarily, you take note of the variables listed above. But it never hurts to keep your finger on the pulse of which companies are the most popular. After all, they may be doing something right if they are getting the lion’s share of the business. When it comes to credit cards, Visa wins first prize, with Mastercard, Chase and American Express doing their best to gain precedence.

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