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#finance Blogchatter A2Z 2021

Cash or Card- What should you use?

Gone are the days when people wanted to spend in cash. It’s a thing of the past. We have been living in a plastic world, where everything is artificial, even money. Modern times call for fast transactions and easy payment options and cards are the new reigns in the money market. 

But while we know that spending from credit card has its own perks like reward points and cashbacks, but paying in cash shows you the reality on how much you can actually afford without disturbing your budget.

So let’s see why cash is better than cards;

Overspending: What is a credit card? Paying for things with the money that you don’t have or that doesn’t belong to you. You plan to buy a 75” TV on your card which cost approx. INR 200,000/-, you won’t realize the money is leaving your side when you pay by card but try paying that in cash and it will pinch you. Many studies have found that people tend to spend more when paying by card than when they have to pay in cash. When paying in cash, you will stick to what you really wanted and budgeted for and not go for the additional features and fancy stuff which you really don’t require. 

Doesn’t disturb your budget: When you are on a tight budget and your goals are in place, you know how much you can spend. Swiping a card allows you to pay next month but you have invariably disturbed your next months budget by incurring an expense this month. 

Less Security risk: We are all aware about the security risks and account hacks that happen when dealing in card payment specially when paying online. Though cards come with security pins and codes, it’s easy to get the identity stolen and theft happening. And, what if you forgot to take your card from somewhere or dropped it by mistake and didn’t realize it till the next day. You have a long bill coming your way with the swipes done by the person who found your card and is now on a shopping spree. 

Accepted everywhere: There is no place where cash is refused. Cards can put you in a spot when the card machine is not working, or your payment gets declined. You just get embarrassment and nothing else from that counter. So, cash is your true friend. 

Cash transaction are private: We know that when you pay by card, your basic details are shared as these stores can sell your purchase data and history to a third party. While, when you pay in cash, your transaction cannot be traced back and it values your privacy. 

There are two sides to every situation. In a situation when your expenses are already planned and you have budgeted for it and the amount is big, like buying a flight ticket for your family. When buying it online, you have to pay by card. You need to keep a mix of both when planning your budget and going for your next purchase. While paying in cash will stop you from overspending, expensive but planned purchases can get you some perks when paid by card. 

If you really want to pay and spend by card itself, there are certain ways in which you can plan it out. Cards give you a good 30 to 45 days times to pay back. In such case, make the purchase just in the first few days when your new billing cycle starts. This was you have the whole month till the bill comes and also additional days till your due date, giving you a good 3o to 40 days’ time to pay back. But if you swipe the card close to the end date of your billing cycle, your bill will be generated in the next few days and you just get 10 to 15 days to pay that up. 

So next time when you step out, make sure you have both, cash and card with you.

Stay around, in my next blog, I will be talking about the benefits of budgeting. 

Till Next time

Save well and spend more wisely

This blog is a part of Blogchatter’s #blogchatterA2Z challenge. 

By mummatalks

Mom of two brats, use to work as an analyst now a SAHM. Love books.

6 replies on “Cash or Card- What should you use?”

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