Saturday, April 27, 2013

8 Ways the Death of Cash Will Change Your Life

  

That feeling of cold, hard cash in your pocket is doomed. Money, in the physical form that we know and love, is rapidly dying. In its place, credit and debit cards — and a host of newer technologies, such as smartphone-based payments and NFC transactions — are increasingly dominating our purchases. 

Javelin Strategy & Research estimates that by 2017, only 23 percent of point-of-sale transactions will involve cash, down from 27 percent in 2011. More than half of consumers polled by British discount website MyVoucherCodes.co.uk said they expect to see the complete demise of all physical currency by 2030.

Cash has hit the downward spiral, but what is it taking with it? While we mourn the death of the greenback and the nickel, let’s consider the collateral damage — the unintended and unconsidered potential consequences of a world with no physical money.

With cash gone, the tip jar as we know it soon follows suit. No more dropping some change, or a buck, as a tribute to your barista. If you want to tip someone, it will have to be digitally — a big hassle for a low-value purchase and one that will likely be completed with decreasing regularity. 

The result: As tips disappear, wages will (finally) have to pick up the financial slack that tipping once achieved. Those costs are passed on to consumers, so menu prices will rise accordingly.

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