Living Without Cash

Have you ever wondered if the day will come when nobody will carry cash and purchases are made using only credit cards? While that might be a little unrealistic in the near future, it is possible to limit your use of cash by a considerable amount.

Think about the situations where you may already function without cash. Almost every gas station has the option to pay at the pump. Add in the perk of using a rewards credit card and there is even more incentive to leave the cash in your pocket. How about at the grocery store? It is very easy to pay for your groceries with the use of a debit or credit card and it eliminates the need to carry a considerable amount of cash to the store. Like the gas station, many credit cards offer increased rewards when used at grocery stores.

Today it is even possible to use a debit or credit card at fast food restaurants. While that might be going too far for some people, it is a possibility. So why would you decide to go stop using cash?

One clear advantage to not using cash is convenience. Using cash requires you to complete the transaction in person, which may be inconvenient or impossible. When shopping on the Internet, cash is not an option. Likewise, cash should never be sent through the mail as a payment, as it can easily be stolen or lost. In addition, not using cash eliminates the need to visit the ATM and any associated fees.

While it might sound nice to not worry about using cash, there are also disadvantages to going without cash. Using a credit card for all of your transactions presents the potential problem of over-spending. It is quite easy to spend more than your budget allows when the cash is not actually leaving your accounts until the bill arrives. One of the keys to not using cash is to pay your bills in full, as otherwise you will be paying interest on those purchases.

Personally, I prefer to use cash for small purchases of a few dollars but tend to use my debit or credit card for anything more than $20 or thereabouts. In addition, purchases such as gasoline and groceries are made using a rewards credit card to take advantage of the cash back bonuses.

The day may come where cash is no longer an option. Until that time, you have the choice so educate yourself on the advantages and disadvantages of each option.

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2 Responses

  1. Olivia says:

    I don’t like to use cash as it isn’t as trackable as is credit or a debit card. Plus my credit card offers frequent flyer miles. After quite a few years of purchases, my husband and I upgraded our vacation to Hawaii to first class, which was very nice.

    Our credit card (USAA) sends us a nice statement at the end of the year with everything broken down into categories so that we can see where we spent our money. That, too, saves us time.

    I found your blog through problogger, and liked what I read, so I just kept reading!

    Thank you!

  2. mnc says:

    Olivia, thanks for stopping by and sharing your comments!

    As you note, the use of a rewards card can really make it an advantage to use a credit card in lieu of cash. In addition, it can provide you with some level of protection if there are any disputes.

    Any vacation to Hawaii sounds very nice but a free (depending on how you look at it) upgrade to first class is just the icing on the cake!

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