Majority of Gen Z Uses Cash Only as Last Resort, Survey Finds

Recent data reveals a significant shift in payment preferences among consumers, particularly Generation Z. A survey by Cash App and Harris Poll indicates that over half of Gen Z uses cash only as a last resort. The survey, conducted from September 25 to 29, included more than 2,000 U.S. adults.

Cash Payment Trends Among Gen Z

Despite cash historically being a widely used payment method, it now ranks third behind credit and debit cards. According to the Federal Reserve Financial Service’s 2025 Diary of Consumer Payment Choice, U.S. consumers make an average of 48 payments monthly, with only seven of those being in cash.

Comments from Gen Z users highlight a strong preference for digital payments. Many prefer not to shop at cash-only stores. One Reddit user stated, “I do not carry my wallet anymore; I use Apple Pay for everything.” Others echoed similar sentiments regarding the efficiency of digital transactions over cash. This suggests that cash payment usage may have reached a baseline level, as noted by Kathleen Young, executive vice president of FedCash Services.

Changing Payment Methods and Preferences

• Debit and credit card usage is rising among younger consumers.
• Buy-now, pay-later (BNPL) services are gaining popularity, with 42% of Gen Z and Y utilizing them.
• Services like Klarna and Affirm offer flexibility in payment, allowing users to manage budgets without relying on traditional credit.

Sabrina Rozza, a 25-year-old consumer, shared her positive experience using Afterpay to finance a vacation. She emphasized that BNPL services helped her manage payments and provided an alternative to credit cards, which can carry higher risks.

Potential Risks of BNPL Services

While BNPL is attractive to younger generations, it poses risks. Experts warn that without proper financial management, consumers could easily find themselves in overwhelming debt. Rebecca A. Carter, a LegalShield provider lawyer, cautioned that poor budgeting could lead to serious financial burdens.

In summary, the payment landscape is evolving rapidly. With cash being less favored, especially among Gen Z, the trend towards digital and flexible payment options is likely to continue. As habits shift, understanding the implications of these choices becomes increasingly important for consumers.