When asked how they will pay for their purchases, 50% plan to use cash, while 27% will use debit/ATM cards, 13% will charge it on their credit cards, and 9% will use personal checks. Compared to a year ago, that is an increase of 6% in use of debit cards and a 2% increase in credit card use and a drop of 9% in payment by personal check. 31% of population have school-age children, while 69% of Americans do not have school-age children.

"The results of the Cambridge Consumer Credit Index wildcard question show although spending patterns have not changed significantly from 2004, many more parents plan to pay for back to school purchases with debit/ATM cards and a few more will be using their credit cards. The big drop in use of personal checks indicates that the debit card is replacing check use," says Jordan Goodman, spokesperson/financial analyst for Cambridge Consumer Credit Index.

These findings are the result of monthly nationwide telephone poll of 800+ adults conducted by ICR/International Communications Research in the past week, sponsored by the Cambridge Credit Counseling Corporation.

The overall Cambridge Consumer Credit Index fell by 5 points in August to 58. The Index fell sharply in both its intentions on credit use in the past and present month, but rose slightly in its intentions for the next six months. The "Reality Gap," which is the difference between the amount of debt consumers say they will pay off in the next month versus the amount of debt they actually paid off a month later, fell by one percentage point from July to 13 points. A month ago, 80% of Americans planned to pay off debt, while a month later only 67% actually did so.

According to Chris Viale, President and CEO of Cambridge Credit Counseling Corp., "It is reassuring that the majority of parents will use cash, debit cards or personal checks to make this year's back-to-school purchases, rather than relying on credit. This time of year provides a great opportunity for parents to teach their children basic budgeting and money management skills that they will be able to use throughout their lives. As is the case when shopping for anything, such expenses should be factored in to an overall spending budget that is within your means, and not one that will bring you deeper into debt."

In conjunction with the Index, Cambridge Credit Counseling Corp. is releasing its monthly survey of people who have called in for credit counseling services over the past month. Cambridge representatives ask callers for the primary reason that they found it necessary to get help with their debts now. Of the 299 people who answered, this was the order of their responses:

1. I am frustrated with high bank rates and fees (31.1%) 

2. My income has been reduced from a lower salary, less overtime or layoff (31.1%) 

3. I want to improve my ability to achieve future financial goals like buying a house or saving for retirement (16.7%) 

4. I got into too much debt by overspending (6.4%) 

5. Other (6.0%) 

6. My lack of financial education caused me to take on too much debt (4.4%) 

7. Large medical expenses forced me to take on huge debts (2.3%) 

8. Recently divorced or widowed (2.0%) 

For more information on the survey see http://www.cambridgeconsumerindex.com/index.asp?content=client_survey

The Index survey is conducted by ICR (International Communications Research) of Media, Pennsylvania over five days in the week before the Index is released. Over 800 households are polled based on random-digit dialing, with all demographic and regional groups in America fairly represented. The Index has a margin of error of plus or minus three and one-half percentage points.

For more information about the Cambridge Consumer Credit Index, contact Paramjit Mahli at pmahli@cambridgeconsumerindex.com or 631-786-6450 or the Index website at http://www.cambridgeconsumerindex.com/.