I often get asked, “Why do you always pay with cash?” People suggest “Just use your credit card. It’s easier,” or they say my personal favorite, “You’re missing out on reward points.”

Here’s why I stick to cash:

Many people believe credit cards offer more buying power. Heck there have been TV series touting this (Money Explained on Netflix). I don’t know where they are getting their information, but the businesses I frequent charge an extra fee for credit card transactions, typically between 2.5% and 3.5%. Even if your credit card gives you an average of 2.5% cash back (most give you 1 – 5 points per $1 spent, you’re still losing out if you’re paying a 3% fee just to use the card. Essentially, the value of those reward points gets nullified by the additional costs.

To me, spending cash makes the act of purchasing feel tangible. Parting with physical money is an experience in itself. It means something. This emotional connection makes me more conscious of my spending, even if there’s no scientific data to back this up.

I am not in credit card debt- but I honestly feel endorsing the use of credit cards is irresponsible in its best form. Credit card debt is a growing issue in the US. Its huge. According to bankrate.com, in 2023 about 49% of adult Americans carry credit card debt from month to month. This figure has increased by 10% since 2021. Is that not alarming???

The US economy relies heavily on consumer spending, a key indicator of economic health. This spending often depends on debt, with consumers using credit to buy goods and services. While this boosts GDP and creates jobs, it also poses significant risks. Many consumers spend money they don’t have, leading to a cycle of debt that’s hard to escape. Economic stability becomes precarious if debt levels become unmanageable, potentially causing a slowdown in growth.

One could write a book on this and not to go on a tangent, but relying on debt-fueled spending overlooks the importance of financial literacy and responsible money management. Encouraging overspending can lead to financial crises, as seen not long ago in 2008. To ensure sustainable growth, both individuals and policymakers need to promote balanced spending, saving, and responsible borrowing, creating a more stable and resilient economy. “Just paying with a credit card”- goes against this fundamentally.

Cash also offers a unique sense of freedom. Unlike digital transactions, cash isn’t tracked by the government. It remains the only truly anonymous form of payment, preserving privacy in every transaction.

While using cash apps might seem convenient, I find paying with cash almost effortless. Reaching into my wallet for a few bills is a simple, almost thoughtless act that keeps my spending grounded in reality.

Additionally, as a small business owner- I feel the pain of credit card acceptance! We currently charge our customers a convenience fee of 3% when they pay via credit card – but in years past we would “eat” this fee. It was literally tens of thousands of dollars every year – right off the bottom line. So, while it may seem old-fashioned to some, paying with cash keeps my finances clear, my debt nonexistent, and my transactions private.

That’s why I choose cash.