My parents live in Florida, and whenever I visit, my dad always asks me if I have any cash on me. It’s not that he needs to borrow some; it’s quite the opposite. My dad firmly believes in carrying cash in case of the unexpected. In response, 9 times out of 10, I tell my dad that I do not have any cash. He usually slips me a twenty dollar bill.
My dad is right to be concerned that I never carry around any cash. As a safety precaution, we all should carry some cash in case of an emergency. I’m not saying that you need to carry a lot; you certainly wouldn’t want to get robbed or lose any of it. However, in a world where people only use cards, cash is still king.
Here are8 reasons why you should always carry some cash.
1. Splitting Bills
Eating out and splitting the bill with friends or roommates? Some restaurants may be able to print out separate checks, but it is much easier and timely to pay as a single party. Similarly, if you and a shopping buddy split a purchase, it’s easier to do so with cash. Otherwise, one person might get stuck with the whole cost if the other promises (and forgets) to reimburse later on. Also, written checks might cause an inconvenient trip to the bank or an ATM.
2. Tipping
My sister-in-law is a server at an amazing restaurant, and she has told me that she prefers cash tips over credit. If she gets a cash tip, it is all hers. While she does give some money to her busser, it does not go through management, which takes its own cut on tips given in credit. If you know you will be dining out at a sit-down restaurant, make sure you bring some $1 bills for proper tipping etiquette.
3. In Case You Can’t Use A Card
It seems as though you can use credit or debit cards pretty much anywhere these days. And for the most part, this is true. However, there are some places that only accept cash. For example, I was once in a taxi vangoing to the airport, and to my surprise, they only accepted cash. The whole van of people had to wait for me to pull cash out of an ATM. Needless to say, they were not too pleased with me.
Vending machines are another example of these rare cash-only moments. Yes, some vending machines do take cards, but the majority of machines do not. Sometimes when you are thirsty, it is necessary to use a vending machine to get a drink, especially after a work out. My mom and I always bring a few dollars with us when we go running in the park.
4. In Case Of An Emergency
You never know what can happen, so you always need to be prepared. If you are going on a road trip, and you don’t have a AAA membership or some other road side service, you need to make sure you have enough cash to pay a tow truck. Having cash at hand is one of the more importanttravel safety tips.
5. Suspended Card
Although some emergency service providers accept credit cards, you never know when your card might let you down. What if your payment won’t go through? Perhaps your credit card company suspects fraudulent charges and suspends your card. Hopefully you didn’t reach your spending limit (remember the Golden Rule of credit cards!). If you are trying to use a debit card, what if you have insufficient funds? Don’t depend too heavily on your plastic – you may find yourself in a tight spot. Believe it or not, more Americans are saying no to credit cards and using cash instead.
6. Envelope System
If you live by the envelope budgeting system as a means to getting out of debt, you must have the cash on you. Otherwise, you won’t get very far with your budgeting and will find yourself constantly overspending. One of the reasons that this methodology is effective is because you see the money physically being spent or saved. This cannot be done without cash. Alternatively, you can follow this same strategy using an online money management tool like Mvelopes.
7. Tolls
When I traveled to Orlando a few months ago, I had to take several toll roads. Even though I knew I needed to take them, I forgot to plan ahead. When the time came for the drive, I had absolutely zero cash on me. For each of the 5 toll plazas I went through, I had to fill out paperwork and send a reimbursem*nt to the Florida DOT after the trip.The whole situation could have been avoided if I had cash with me at the time.
8. Mug Money
I have a friend who always carries a twenty dollar bill just in case he gets mugged. His hope is that if he gives themugger the $20, he will be left alone and themugger will be satisfied. I have no idea whether or not this actually works, but I would much rather give a mugger a $20 than my credit or debit card!
Do you carry cash with you in your purse or wallet?How about in your glove compartment? How much do you usually take with you?
FAQs
Cash allows you to purchase essential items like food, water, and medical supplies when electronic means of payment are unavailable. Cash can also serve as a backup in instances of identity theft or fraud, offering an alternative means of payment while resolving any issues that may arise.
Why should you always carry cash? ›
Cash allows you to purchase essential items like food, water, and medical supplies when electronic means of payment are unavailable. Cash can also serve as a backup in instances of identity theft or fraud, offering an alternative means of payment while resolving any issues that may arise.
Why you should always have cash on hand? ›
Key takeaways. Reasons people keep cash at home include emergency preparedness, financial privacy concerns and mistrust of banks. It's a good idea to keep enough cash at home to cover two months' worth of basic necessities, some experts recommend.
Why you should keep money in cash? ›
Because keeping money in cash is all about stability and liquidity. And if you were to find yourself in a scenario where you need money now — say you lose your job, or have to manage a financial emergency — you want a stash of money in accounts you can quickly and easily access.
Why do we need to keep using cash? ›
You don't need access to equipment, the internet or electricity to pay with cash, meaning it can be used when the power is down or if you lose your card. It's legal tender. Creditors, such as shops and restaurants, cannot refuse cash, unless both they and the customer have agreed on another means of payment in advance.
Why is cash holding important? ›
The psychological benefits of holding cash in a portfolio are often undervalued. Cash, including money market funds, enables investors to remain committed to their investment strategy through various economic, market, and political climates, thereby providing a sense of assurance.
Why is cash still king? ›
When paying with cash, people are physically limited to the amount they have in their wallets. This helps save money and not accumulate debt. Paying with cash allows you to see exactly how much money you have at any given time and, based on that knowledge, make decisions about your spending.
Why do people prefer to hold cash? ›
For transactions People need money for day-to-day living, paying bills, making purchases, and ensuring they can cover their expenses. As a precaution People usually save money to ensure that they can cover emergency bills or costs, such as illness or unplanned repairs-related costs.
Do I need to carry cash anymore? ›
Still, there are times when only cash will do, such as when a businesses only accepts currency or you want to give someone a tip. “While it comes down to personal preference, I'd say that most people probably don't need to carry more than $50 in cash,” said Ted Rossman, senior industry analyst at Bankrate.com.
Why should we keep cash alive? ›
If cash is removed, their way out will be that much harder or close to impossible. Elderly, blind and people with disabilities will struggle. Many people can't or don't know how to use technology. They would also be vulnerable to scams and other technological difficulties.
Pros and Cons of Cash
Some believe paying cash helps them save money. Most people are willing to spend more on their plastic than in cash. Paying cash also avoids the interest charges on credit cards. If you can't pay your statement balance in full each cycle, you'll accrue interest charges.
Why is cash important? ›
Cash refers to the physical money a business has in notes and coins, along with any money it has in the bank. The management of cash is very important as cash allows a business to pay its bills. The main cash payments a business makes include: payments to suppliers.
Do you still need cash? ›
Some people still prefer to use cash, perhaps because they like the tactile nature of physical currency or because it provides confidentiality in transactions. But digital payments, made with the swipe of a card or a few taps on a cellphone, are fast becoming the norm.
Why shouldn't we go cashless? ›
The downsides of going cashless include less privacy, greater exposure to hacking, technological dependency, magnifying economic inequality, and more. Credit and debit cards, electronic payment apps, mobile payment services, and virtual currencies in use today could pave the way to a fully cashless society.
What are the advantages of cash? ›
There are certain advantages to using cash, such as:
- you only spend what you have.
- you don't pay interest or fees.
- you may get a discount since merchants don't have to pay a fee to accept cash transactions.
- it may be faster and easier than other payment methods.
- it doesn't require equipment, internet or electricity.
More businesses are offering financial incentives to consumers who pay with cash rather than credit card. Consumers may save 2% to 4% on their purchase by using cash. They'll also often save with a debit card, experts said. Businesses charge more for credit card purchases due to fees they incur per transaction.
Why should you always pay in cash? ›
Advantages of paying with cash
There are certain advantages to using cash, such as: you only spend what you have. you don't pay interest or fees. you may get a discount since merchants don't have to pay a fee to accept cash transactions.
What is the purpose of cash and carry? ›
Cost savings - By paying for goods on a COD basis, cash and carry allows retailers to benefit from discounted prices. This means that they can purchase goods at a lower cost than they would with a normal FOB or contract order.
