For years I have contemplated if it’s best to use cash for credit to make purchases. I debated, researched, did some soul searching and closely watched my spending to decide which was going to work best for me. After overcoming a minor shopping addiction and getting a healthy handle on how I shop, I have been safely and responsibly using one option over the other for some time. Below is a pro and con list of using cash versus credit cards that comes straight from a recovered shopaholic.
Cash Pros:
- Immediately noticed deduction of income
- Helps manage budget
- Quickens math skills if counting on the spot during a transaction
Cash Cons:
- Hard to replace if lost
- Easy to lose track of spending if making multiple purchases
- Cash is fairly dirty
Credit Card Pros:
- Most cards offer cash back incentive
- Can pay bills using automatic payments
- Possible additional warranties included free of cost
Credit Card Cons:
- Easy to lose track of spending
- Interest rate raises initial cost
- Can obtain too many credit cards
After scrutinizing my own personal spending habits and expenses, I settled on using credit cards for all of my purchases that don’t incur a fee for doing so. Anytime there’s an extra fee for using a charge card, I will opt for the alternate payment option which is usually paying with cash or making a payment directly from a bank account. If there are no fees for using a credit card, I always go for my plastic so I can have a ledger of my purchases and get cash back on everything. It may not seem like much at times, but cash back amounts add up quickly and every dollar has value.
What payment options works best for you? Do you rotate the way you pay for costs?