Cash or no cash?

I don’t know about you, but I hate cash. I find it dirty, I don’t like the fact that I need to wash my hands after holding it, or that I feel dirty if I can’t. I don’t like the weight in my pockets or in my purse, I don’t like that you never know exactly how much you have unless you keep a strict tally, so you can lose it, someone can steal it from you, or it can become useless because you forgot your bill in the washing machine.

 

We have a pretty strong cash system in France. Big companies will accept your card for small amounts, even under a euro, while most small businesses will ask you to pay any amount under 10 or 15 euros in cash. If you go out, you will need cash for the bar, cash for the restaurant, and cash for the cab ride home. In the UK you can pay a cab ride with a card, and most small businesses will accept any amount paid by card, which I find fascinating.

I just came back from Miami and it was the same. I left Guatemala with $480 in cash and at the end of the holiday I had $400, mainly because I put gas in the car in cash, as the machine won’t recognize a UK postcode when you swipe your card and have to enter it. Apart from that and a $0.35 photocopy where I got almost yelled at for trying to pay with a fiverr and was sent looking for $1 bills, I don’t think I ever had to pay cash for anything.

It was so nice, after months in Guatemala where only the supermarket will take cash (and other small businesses, for a 5% surcharge, no thanks).

 

For me, paying with a card has so many advantages:

 

It is easy. You swipe the card, and that’s it. You wouldn’t believe how long it took the photocopy lady to give me my $0.65 back in coins.

It is convenient. When you log in to your online banking, all the transactions are neatly stored and ready for you to check. Do you remember what you did with your last $20 bill? Software like Mint will upload the transactions instantly in your budget management program.

It is safe. You have a purchase protection on your card if something goes wrong. You have a proof of purchase for the guarantee. You even have a full reimbursement if your card is cloned and used by someone else. That happened to me once and the bank paid back in a week. No one will give you your stolen cash back.

You don’t need change. In Guatemala, I had a $0.4 bill. I paid for $0.3 cookies. The shopkeeper had to go to the neighbor’s to get some change. I try to always have small denominations so I avoid waiting for my change, but it happens here and there and I hate waiting for nothing.

Credit card churning. Sadly, my card doesn’t offer miles or cash back, if yours does, it is a great way to get free rewards.

Insurance. My card does come with travel insurance if I buy a flight with it. It has rental car insurance if I pay the car with it, which saved me $150 on the last trip to Miami. If the flight is late, the card will cover your meals and if your bag doesn’t show up, there is an allowance to buy clothes and toothpaste while it arrives.

It is clean. In my town, most women don’t have a purse and keep the cash in their bra, while they sweat all day. Even with normal behavior, cash is pretty dirty. What I don’t like is going to a fast food, paying with cash, and having to wash my hands again before eating while my meal gets cold. With a card, I can wash hands before ordering.

Peace of mind. When I travel, I often have more cash on me, just in case I can’t use the card. But every time I get out of the hotel room, I can either leave the cash in the room and come back worried the cleaners stole it, or keep it on me and worry I will get mugged or my bag stolen. A card gives me more peace of mind.

 

However, cash could be good too.

 

If you need to limit your spending. I just spent $2,000 mostly in shopping during the past two weeks in Miami. I knew it would be an expensive trip and was fine even with a bigger amount but I had no idea how much I had spent until I got home and crunched the numbers. If you don’t know how to manage your money, withdraw what you can afford to spend in cash and when it is gone, that’s it. It is easier to go over budget swiping a card.

It hurts. Spending cash psychologically hurts more than swiping your card. So you think about it twice before making a purchase.

You may get a discount. The same way people in my town add an extra 5% to pay by card, some businesses will agree to a small discount if you pay cash. Sometimes, it is not worth the trouble. But if you are already on site and ask for a cash discount, people may oblige.

 

What do you think, cash or no cash?