The debit card might as well make itself comfortable in the outer slot of America’s wallet. It reigns as the go-to payment method for everyday purchases, according to a U.S. News survey.
But while baby boomers are almost as likely to reach for the credit card, younger generations aren’t using that form of plastic nearly as frequently as their elders. And regardless of how Americans are choosing to pay, many of them are racking up fees and interest due to missed payments or bank overdrafts.
Between Dec. 16 and 17, U.S. News ran a nationwide survey of 1,209 Americans asking respondents about the payment methods they use as well as when and why they prefer those methods. The survey, conducted through PureSpectrum, included a roughly even distribution of respondents from the following generations: baby boomers, Gen X, millennials and Gen Z. This allowed us to examine how payment preferences vary among age groups. Here’s what we found:
— Fifty-six percent of those surveyed say they most frequently use debit cards for everyday purchases, while 31% say the credit card is their first choice for routine expenses. Cash was the top option for 10%, and 3% of respondents prefer buy now, pay later, or BNPL, platforms such as Klarna or Afterpay.
— There was a noticeable drop-off in credit-card usage from baby boomers to younger generations. While 42% of boomers say they most often use credit cards for common purchases, only 27% of all other respondents listed the credit card as their payment of choice. More than 20% of Gen Z respondents say they never use a credit card, compared with just 11% of boomers who prefer to go without one.
— Three in five respondents say they’ve overdrawn their debit card or checking account in the past year, while 38% missed a credit card payment during that span and 14% failed to make a BNPL payment. Two-thirds of Gen Zers and millennials reported bank overdrafts in 2025, while 40% of boomers say they missed credit card payments, the highest of any group.
— Roughly 43% of respondents believe that using their debit card allows them to establish credit. Although a few specialty debit card programs report on-time payments to credit bureaus, debit cards generally don’t help you build credit.
[Read: Best Checking Accounts.]
Younger Generations Are Less Likely to Pay with Credit Cards
Boomers may be carrying credit cards in more ways than one. About 42% of that generation uses credit cards for most of their purchases, but our survey found a wide gap in credit card use between boomers and everyone else. Only 27% of all other respondents say credit cards are their main payment method. In fact, 20% of Gen Zers, millennials and Gen Xers combined say they never use a credit card at all.
For many, the preferred alternative is a debit card, but cash and BNPL also eat into the credit card’s market share. When asked why they prefer debit, younger generations overwhelmingly point to two reasons: avoiding debt and tracking their spending.
“I like the idea of a debit card because it means you’re using money that you’ve already earned and not betting on a future that may or may not come financially,” says one Gen X respondent.
Millennials in particular stood out for their preference of debit cards. Only 24% say they most frequently use credit cards for purchases, and 71% say debit cards are the payment method that feels most financially sound to them.
A majority of respondents in all generations chose the debit card as the more financially sound option, but those who chose the credit card noted security features and rewards as appealing aspects.
“It is easier to dispute charges, and I use my credit card to get rewards and airline miles,” says a Gen X respondent who used to mostly use debit cards but has recently switched to credit.
[Read: Best Credit Cards.]
Although Americans are pulling out debit cards most often, that doesn’t necessarily mean they’re spending more overall on debit cards. The average credit card purchase is $83, while debit card purchases average about $70, according to Federal Reserve Bank of Atlanta’s 2024 Survey and Diary of Consumer Payment Choice.
Gen Z Tops Boomers in Use of BNPL (Duh) and (Gasp!) Cash
Two other payment types — BNPL and cash — lagged considerably behind debit cards and credit cards in terms of most frequently used payment method.
Not surprisingly, younger respondents were more likely to use BNPL, an app-based short-term financing option that allows consumers to make purchases immediately and pay them off later, often in interest-free installments. About half of Gen Zers and millennials say they use BNPL sometimes, and 4% say it’s their go-to payment option.
But who would have guessed Gen Zers and millennials are more likely than Gen Xers and boomers to rely on cash as their purchasing tool of choice? About 12% of those younger generations say they most frequently use cash, compared with less than 9% of older generations.
So That’s Why Banks Won’t Let Go of High Overdraft Fees
When you’re choosing a bank account, you might compare interest rates, monthly service fees or ATM availability. But overdraft fees, often tucked deep inside the account paperwork, can be an afterthought. Perhaps they shouldn’t be.
About 60% of respondents say they overdrew their debit card or checking account in the last year, which means they attempted to make a transaction that required more money than the account held. When this happens, a bank may either decline the transaction and charge you a nonsufficient funds fee, or it covers the transaction and charges you an overdraft fee. These fees are generally around $35 per overdraft at many major banks. And they can really add up.
For example, let’s conservatively say each of the more than 700 survey respondents who overdrew their account last year only did so once and was charged $35. That’s roughly $25,000 in fees altogether.
The Consumer Financial Protection Bureau in 2024 acted to limit those fees to $5 at most large banks, but institutions fought that effort, and Congress ultimately overturned the rule before it took effect.
Two-thirds of both Gen Zers and millennials reported overdrawing their accounts in 2025, while less than half of boomers say they did so.
However, boomers were the generation most likely to have missed a credit card payment last year, perhaps not surprising considering their more frequent usage. About 41% of boomers skipped a credit card payment in 2025, compared with 38% of all respondents. About 14% of those surveyed say they missed a BNPL payment, which can result in fees and other negative financial impacts.
[SEE: Best Free Checking Accounts]
‘I Don’t Need the Stress’: Why 30% of Americans Have Avoided Getting a Credit Card
Survey respondents are worried about credit card debt, and they have good reason to be. The average credit card debt in the U.S. grew to $6,735 in June 2025, according to Experian data, with Gen X borrowers racking up an average of $9,600, by far the highest of any group.
Three in five respondents say they are at least somewhat concerned about credit card debt, with 29% saying they are “very concerned.” These fears are slightly less prevalent in older generations, with 26% of boomers saying they’re “not concerned at all” compared with just 8% of Gen Z reporting no concern.
The fear of falling into debt has contributed to 30% of Americans surveyed saying they’ve avoided getting a credit card. Most say they don’t think they could keep up with payments, and worry they’d spend more than they can afford. Some say they aren’t familiar enough with how interest and fees work.
“I don’t need the stress that comes with it,” says a millennial who says she instead uses BNPL for most everyday purchases.
One baby boomer declared a different reason for avoiding getting a credit card: “I already have around 22.”
This piece was edited by Mark Evitt and reviewed by Ray Frager.
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Survey: Gen Z, Millennials Are Ditching the Credit Card for Other Payment Methods originally appeared on usnews.com
