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Is Cash King? Will we be a cashless society soon?

January 26th, 2020 at 08:40 pm

A couple of days ago NBC reporter had a story on whether we would be a cashless society. He really didn't answer the question, but talked about his experiment where he kept all his receipts after using his charge card for a week, and then all the receipts for using cash. It wasn't really a fair experiment in my book because he admitted he had to keep getting cash and that he had to replace a hard drive so that really drove his spending up. I think he should redo it and just see what he spends if he only has cash and when he runs out, he can't head to the ATM. He did admit that he was a mess as far as money so maybe there was some value in his cash v. plastic trial.

I know I blogged about counting pennies and taking them in to put in our vacation fund. Fortunately our credit union lets us bring change in and doesn't charge us. I did take some wheat pennies into a coin shop. I knew they weren't worth much, but figured anything over the penny was better than nothing. I realized a dime for my troubles, but it was an errand that didn't cost me anything but a few extra steps since I was already near the coin shop. The young man who waited on me said that wheat pennies aren't collected very much anymore and most people just melt them down for the copper.

Most of my friends rarely carry cash. They bring out that credit card for everything. And those friends are the ones who complain about being short of money. Two of my friends use cash for most things. That is not to say they don't use credit cards or pay with checks, but for some of the mundane things, they use cash. DH almost always pays cash. I had read some articles years ago that said if people saw the cash they were spending, they would be more mindful.

A couple of years ago a friend who never carries cash had an issue with his debit card. It is one of those that is both a debit and credit card. Something happened that made the bank lock down the card and it was over the weekend and he could not get a hold of anyone. He had no cash at home. No checks. And he and his spouse do not keep food in the house -- they shop before most meals unless they go out. He said he never thought what it would be like not to be able to buy gas, buy groceries, or even a cup of coffee. When he got in to the bank early Monday morning, the bank manager said it would take a couple of days to figure out what was going on and unlock the accounts and he suggested from now on my friend should keep some cash at home in case there is another problem.

So, if we do become a cashless society, what happens when there are glitches. With all the technology problems, hackers, etc, I can see this happening if we depend on cards, Apple pay, or whatever else is out there.

16 Responses to “Is Cash King? Will we be a cashless society soon?”

  1. Wink Says:

    I rarely pay with cash. I like to use my credit card to get the rewards (cash back). And I'm super conscious of what I spend and stick to my budget. But I do always keep a $20 in my wallet just in case I do need cash for something small for some reason. It is an interesting discussion about what would happen if there was some major, sustained glitch with the whole plastic/mobile payment system!

  2. GoodLiving Says:

    I'm like Wink, I use plastic most of the time because I like the cash back (costco citi) or the discount (Target redcard) but I pay them off every month. I'm very conscious about my spending over years of keeping track. I do have some cash (about $200) at home if I need it and I usually have somewhere around $20 in my wallet most of the time.

  3. disneysteve Says:

    I rarely use cash, but I always carry it just in case. We've told our daughter to always do the same.

    I think it's pretty doubtful that all forms of electronic payment would go down at once unless there was some major disaster, but it can't hurt to have some cash in my wallet as a back up. And I do still encounter the occasional merchant that is cash only.

    We also keep an emergency stash of cash secured in the house. If there's some disaster or we have to evacuate, that's on the list of things to grab before we head out.

  4. Amber Says:

    Last year I used mostly cash. However, I find myself now using the CC and paying the bill immediately, simply to earn the points. I have cash envelopes that help me stay on budget. When I use the CC, I take the amount out of my envelopes, deposit it and pay the bill. It’s time consuming but works for me.

    What is wheat pennies?

  5. Kymberlee Fisher Says:

    I rarely use cash. I do carry some on me. And I do keep cash on hand at home.

  6. Lots of Ideas Says:

    Amber, old pennies have shafts of wheat on the back.
    Any value they have is because of their age!

  7. Smallsteps Says:

    I too thought we were fast on our way to just cards etc for payment but just this last week I saw an article about NYC( may have been whole state of NY) proposing an ordinance saying businesses cannot go cash free as that would leave out the large amount of people that are UN-banked and have no credit.
    The article listed other areas that also recently passed like measures. For business it would seem an easier route to be cash free thus eliminating chances of theft or mishandling.
    i looked for the link but cannot seem to find it today.

  8. mumof2 Says:

    we use cash for gas and groceries, we take it out each pay and only use that...all bills are paid online...we don't use the CC except for works for us...but I think that cash will always be around

  9. disneysteve Says:

    Smallsteps, I believe Philadelphia passed a law like that this past year. The only places that were exempted were places that are largely unmanned like parking lots and the like. The supporters say that going cash-free is discriminatory against the poor and lower class who tend to be unbanked and not have access to debit and credit cards.

    I know we have encountered at least one restaurant chain in Virginia that is cashless.

  10. creditcardfree Says:

    Nope. We won't become cashless. I live in a town that thrives on cash, major tourist area. Tips, tips, tips and more. We use our credit cards, paying off twice per month on paydays. We now always have cash on hand for tips and other places that only accept cash in our area. We also keep cash in our home for emergencies. Cash is king, tell me someone that would refuse it if their cashless system was down?!

  11. creditcardfree Says:

    Oh, and I just came across 4 wheat pennies that I had been saving, nice to know what you got for them. I knew it wouldn't be much.

  12. Lucky Robin Says:

    We are mostly a cash based household, but we do still use one credit card for some things (Netflix, Hulu, Ting), with it being paid off before any interest hits. One thing that I was always told if you are using credit is to have one VISA and one Master Card, because they did not use the same system, so if it went down, you had the other. I don't know if that is still true or not since they now use internet based systems for a lot of it.

  13. CB in the City Says:

    I use credit cards for just about everything, thus earning rewards and having a backup record of my spending (in addition to the tracking I do myself). I only use cash when I have to, or when I have to use it up! I don't believe people spend more using credit cards -- or at least not BECAUSE they are using credit cards. Spending is a mindset, and I am just as careful and mindful with my credit card spending as anyone could be using cash.

  14. disneysteve Says:

    " I don't believe people spend more using credit cards -- or at least not BECAUSE they are using credit cards. Spending is a mindset"

    I totally agree, but I also realize that we are in the minority. How much I spend is not influenced in any way by how I pay when I get to the register. It just isn't.

    But study after study has shown that the average person does spend more with a credit card. McDonald's saw their average tab rise significantly when they started accepting credit cards. Most people love to spend money they don't have.

  15. rob62521 Says:

    Amber, here is a site about wheat pennies. I don't think the values are accurate, but you can at least see a photo of what they look like:

    All your comments are interesting. I think the fact that some of you said you don't feel credit cards are the reason people spend more, but I also feel that many of you are very good about tracking your spending. The reporter admitted he wasn't, he just pulled out the card because it was easy. As Disney Steve said, it is a mindset.

    I think most of us all use cards to their best benefit -- I use mine to get the cash back and because it makes check out at the grocery store go faster. We keep cash for eating out and gas and thrift store shopping. I think the servers appreciate getting tips in car instead of having to wait.

  16. LivingAlmostLarge Says:

    There lies the problem. People spend more on CC and I believe even cash. How many people do cash advances on CC or payday loans? If overspending by cash didn't happen then these types of loans wouldn't exist. You wouldn't have people bouncing checks and overdrawing on their checking accounts. It's a way of life for some people. Just how they view money and spending. Using a debit card is supposed to prevent overspending but it still happepns. There are very few people aware of what they make and what they spend. The minority is on this board and real life. Very few people have a firm grasp and handle on what a budget is or how to manage investments.

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