9 Reasons To Go Cash-Only
Written by
Joel Lim
Edited by
Rebekah Evans
Commitment to Our Readers
GOBankingRates' editorial team is committed to bringing you unbiased reviews and information. We use data-driven methodologies to evaluate financial products and services - our reviews and ratings are not influenced by advertisers. You can read more about our editorial guidelines and our products and services review methodology.
20 Years
Helping You Live Richer
Reviewed
by Experts
Trusted by
Millions of Readers
You may have heard of the recent push to go cash-only with your money. Ditch the credit cards, refuse to accept anything digital in your store and go live in the real world with cold, hard cash.
It might have seemed extreme in the past, but with more power outages, increased surveillance across the globe and a rise in cyber attacks, going cash-only might be smart for both people and businesses.
Here’s our definitive list of reasons why you might want to go cash-only.
Reasons for Individuals
Increase Your Spending Awareness
One of the biggest advantages of using only cash for all your purchases is that it also raises your spending awareness.
It’s much harder to let go of those 20-dollar bills than it is to just swipe a card.
You can become more mindful of your spending and potentially spend less. You may even stop yourself from making unnecessary and frivolous purchases.
Increase Privacy
So, why should you join the many people choosing to become a cash-only consumer? There are many reasons and one of them is increased privacy.
When you use your card, you can be tracked by banks, Big Data and even the government, according to the American Civil Liberties Union (ACLU).
Who knows what any of these entities are doing with your purchase information, but the bottom line is that they do indeed have it.
They can track what you buy, when you buy it and where you buy it, at any given time of day.
For some people, that’s just too much invasion of privacy.
Avoid Fees and Interest
For a simple, no-brainer reason to go cashless: it’s cheaper.
Yes, using a credit or debit card involves paying fees. You have your bank fees, store fees for using a card and interest fees on credit cards.
This adds up to $120 billion per year in the United States, according to the Consumer Financial Protection Bureau.
So you’re spending more money for convenience when it’s much more convenient to just always have cash on you.
Protect Against System Failures
Another valid reason to increase the amount of cash you have on hand and consider only using banks when absolutely necessary, is the rise in power outages and system failures.
During a city-wide or countywide power outage, you don’t want to end up with no way to pay for your necessities.
If businesses can’t accept payment from you, then they can’t sell you food, gas and other supplies necessary for your survival. A cash-only system can always prevent that from happening.
Control Your Budget
When you work with cash, you start out with a certain budget at the beginning of the pay period and you force yourself to stay within the limits of that amount of cash.
You can’t overdraw your bank account, you can’t borrow from next week and you can’t use a credit card and pay fees.
People find ways to work and live within their means, which makes them more capable of growing their wealth and saving money for future goals. Cash is, as they say, king.
Reasons for Businesses
Reduce Transaction Fees
For virtually every business, you’ll get hit with some kind of transaction fee to accept credit and debit cards. Even if you pass those charges along to the customer, you still have to pay for the equipment, the service and the option, according to Forbes.
Who needs all that? Just make it clear on your front door that you only take cash as payment. Then be sure to place another sign at your register: “Cash Only.”
If you sell great products at great prices, your customers will go get their cash and come back.
Lower Risk of Fraud
What a pain to find out one of your customers paid with someone else’s card. Now you have to deal with the bank, with the angry card owner and with lost product.
Even if insurance covers your financial losses, it could take time to recover. If you’re a small business owner, you can’t wait weeks or months for reimbursement. Just take cash.
Simplified Accounting
When you only accept cash, all you have to do is compare your receipts to your cash at the end of the day. Simple and easy.
When you take cards, you have extra receipts to add up, more math to do and more accounting to keep track of. With inventory, overhead, invoicing and more, refusing to take cards is just a matter of making your business more streamlined. Give your bookkeeper a break and ditch the card machines.
Cater To Cash Customers
The rise of customers insisting on carrying cash and using only cash has led to a rise in businesses that cater to those customers. And why not? The more cash in circulation, the better the economy does.
As a small business, you can cater to your niche clients and make it a point to protest the attempts to get rid of cash in the economy. Many people will become loyal customers for that reason alone, maybe even paying a bit more for your products because they feel supported in their ideology.
You Can Start Small
In the end, it’s certainly a viable option to consider moving to cash-only. There are several reasons for both businesses and individuals, not the least of which are privacy and security.
And you don’t have to take the leap all at once. You can simply start out by pulling out more cash each week and seeing how it feels to stick to that budget.
Before you know it, you might be putting all of your trust in cash for virtually all expenses that you can use cash for.
More From GOBankingRates
