Credit cards & vending machines

A recent article (2-26-07) in the Los Angeles Times reported on a new market for credit cards; vending machines. It appears sales have been lost because many people just don't have change, and most vending machines will not take bills larger than $5; but most people are carrying $20 bills they got from the ATM machine.

So while consumers are excited to find a vending machine where they can use a credit card that will give them expensive candy or soda, and Cadburry Schweppes and MasterCard are thrilled to see the sales up by 5-35% in their test markets from New York and Chicago to Dallas, I am concerned that consumers will create even more debt they cannot pay off.

About 14 million Americans cannot do any better than make the minimum payments on the credit card debt. People often make purchases in a trance, do not do comparison shopping, and have no plan on how to get out of debt. They have become wage slaves to the credit issuers and little by little line the pockets of major corporations while going into bankruptcy. Of course many people, one third of credit card users, pay off their balances in full, so I am not talking about them. I am talking about the other end of the population that is being taken advantage of.

According to Vending Times, an industry publication, 2005 sales was $46 billion and was practically all cash. What a wonderful new market for the credit card issuers. Fast food restaurants were the last big cash outpost to gain credit card acceptance, and we are all so much healthier as a nation now that we can eat more fast food and put it on our credit card.

While I don't have any solutions here, I can at least post a warning: Wake up and be conscious when using credit cards, or making any purchases for that matter. I created a spending register many years ago that has helped thousands of people get on track with their spending. In 5-10 seconds it allows them to evaluate if they are on target to their financial goals. It allows them to be conscious when they spend money. More more information on that concept, please read my book, Wealth On Any Income.