With the arrival of smart phones, wallets should be getting thinner. On the contrary, Americans’ have increased the girth of their pocketbooks, along with their waists.
Why? Experian, a credit-rating agency, offers one explanation. Consumers carry a lot of credit; about 11 percent of Americans have a minimum of 8 credit cards, with the average holder bearing 3.5. And gift, prepaid, debit, and customer loyalty cards abound. Consumers hold 2 billion memberships in reward programs, up from 1.3 billion in 2007. Let’s crunch some other numbers too.
- The amount of gift-card dollars that went unused in 2009 — $5.8 billion.
- Average fast food tab paid with credit — $14.07.
- Average fast food tab paid with cash — $9.89.
- Rise of gift-card sales from 1999 to 2009 — 358%
- Membership has its rewards — there are 63 million Costco members, 37 million who follow AARP, and 52 million with AAA.
If your wallet is bulging, it’s time to purge. Travelers, an insurance firm, recently stated that 76 percent of all cases of identity fraud in 2009 resulted from theft of a physical object (wallet or credit card), while 9 percent arose from an online or data breach. Financial experts suggest that consumers carry two or three credit cards at most and few or no loyalty cards. Merchants can easily identify you, even if the plastic is at home. Plus, you’ll stop going out of your way to get the unnecessary item that the promise for rewards put on your mind in the first place.