The days of cash being the most-used option amongst customers is long gone; now there are other—more convenient—methods to pay for purchases, including the popular credit card option. Using a credit card has its benefits, just like cash. However, about one in four Millennials carry no more than $5 on their person each day. These customers have checked out on using cash, and instead choose to use a credit card to pay for necessities, as well as the items that they want, but do not necessarily need.
The Debit Card
Although many individuals in today’s society choose to use a credit card instead of cash, they are leery about making purchases with an actual credit card; they prefer to use a debit card. Using the latter allows people to spend what they have, without carrying around cash. You can use the same budget with a debit card that you would with cash. The debit card is actually cash that you have available in the bank or financial institution.
Some debit and credit card companies will allow you to go-over-the-limit and allow you to spend more money or credit than you have available. But they charge a fee for being over-the-limit, in addition to other costs. This is one reason to spend only what you have and to maintain an up-to-date record of purchases and payments you have made.
Liability and Safety
There are many reasons why people choose to use credit cards instead of cash. Two of the main reasons are safety and liability. With so many people are on-the-go these days, accidentally leaving a wallet or purse at the store, work, or other places where it can be stolen is more likely to happen now than it was decades ago. When cash is stolen, retrieving those funds is nearly impossible. However, when a credit card is stolen, it can be cancelled immediately, and depending on the credit card lender, any purchases made before you are able to report the card stolen may be refunded or limited.This policy, and the amounts, will vary from credit card lender-to-lender.
To help cut down, and possibly eliminate credit card fraud, new security advancement systems being created all-of-the-time. EMV chip readers have been created in order to authenticate purchases that you make through cryptographic algorithms. This advance in technology will allow you to make a payment or purchase without giving out your credit card number; future digital payments will be more secure.
Credit Card Minimums
Even though credit cards seem safer and more convenient, there are times when the latter proves not to be true. For instance, some merchants place minimums on your credit card purchases; meaning that you will need to spend a specific amount of money in order to use your credit card. This is often a hassle, especially when you want to make small purchases of $10 or less – the minimum amount will vary from merchant-to-merchant. To pay for what you must, or purchase only the items that you need, using cash would be the best option in this type of situation.
Cash typically means that less money is spent, plus you can avoid interest and other fees that occur when you make a payment or purchase.
When it pertains to acceptability, one could question the “credit and debit cards are more convenient” phrase that many state. You do not have to worry about most merchants accepting cash when you are making a purchase in-person; however, when you make purchases via the internet, using cash right there is not an option. With so many advances in technology, you can order clothes, pay bills, purchase groceries, and make other business or personal purchases via the internet. The issue is ensuring that the merchant will accept the type of credit card that you have; for example, Visa and MasterCard are the most widely accepted credit card payment methods. If you choose to use a credit card responsibly, instead of paying with cash, it is a good idea to always have an acceptable payment method.
Preparing for the Future
Although there are benefits when using cash or credit, it is a good idea to choose the latter, in order to prepare for the future. With the latest inventions, it seems as if society is moving into a cash-free direction, and you do not want to get lost during the transition. Many strategy officers are even projecting that children in the future may not know what cash is. While you wait for that to take place, you can carry a small amount of cash in your purse or wallet, or you can use your credit or debit card to make purchases.