Debit Card vs. Cash - Small Merchants
Last December, I posted here and got excellent advice about setting up appropriate spending categories in Pocket Quicken for my PDA. Not only have I gotten everything set up (and purchased a license for the program so it won't disappear), I've been developing a habit of entering checks/receipts the day that I spend for anything, from groceries to online payments/purchases. I've even learned how to split my receipts into several different categories, so I know all the different directions my money is going. While I realize this is "old hat" to some, I'm pretty proud of myself for getting this far in tracking my finances, since I've historically been too lazy to do so.
So my hubby and I have finally decided that it's time I transitioned from a paper checkbook to a debit card for the household account. I have a debit card for my personal account, but the daily limit is too low to actually make it very "usable" for things like gas/groceries (it's a credit union card - $100 per day limit), and all of the household expenses come out of the household account anyways. I'd resisted the debit card for several reasons, mainly security and a mental willingness to pay more for "stuff" when using plastic (the reason I'm paying down credit cards now). But I think I have the spending under control, and with more and more stores/restaurants refusing to take checks anymore, I either have to get a debit card, or carry quite a bit of cash with me (since I'm trying to pay the credit cards off, not use them at the moment). Right now, I don't carry cash at all, since for me, it's far easier to spend cash than writing a check (I know it's all mental - but it's there).
The only thing I worry about with the debit card is smaller merchants. I've read that if you are purchasing a smaller amount that it actually costs the merchant more if you use a debit/credit card than the purchase itself. I try to shop locally whenever possible, and I don't plan to carry my checkbook once I start using the debit card. I'm mainly thinking of my weekly/bi-weekly cricket purchases at the local pet store - $6.00 each time, or the occasional small purchase at the health food store.
So can anyone give me advice on when to use the debit card vs. when to pay cash - ie, what dollar amount (approx.) is the "cut off" point for smaller merchants having to pay more in fees? I figure I'll just take out a small amount of cash ($20.00 or so) every month to carry for those times, so local "mom & pop" stores don't get hit with that extra fee for smaller purchases.
Thanks for any advice on this!