Cash vs. Credit Card: Where is the Better Option?

The cash vs. credit card debate has been going on for quite some time. There is no clear answer on which is better though both sides have several compelling arguments.

Below, you can find out whether cash or credit card is the better option.

Why Cash is Better

Many people would rather pay with cash rather than using a credit card. Some of the best reasons to pay with cash are:

• Widely Accepted:
  • Cash is universally accepted so you will always be able to make purchases, whereas not all credit cards are allowed by all merchants.
• Tangibility:
  • Using physical cash allows you to better keep tabs on your spending habits, with your money online spending is easy so you may overspend.
• No Interest or Fees:
  • With cash there are no interest or fees to pay so you do not have to worry about racking up late fees.
• Freedom From Debt:
  • Using cash makes it a lot harder to fall into debt. While still possible to overspend as long as you don’t borrow from creditors and overspend you won’t be in debt.
• Safety:
  • You cannot get your identity stolen by using cash, no need to be concerned about fraud when you just spend cash.

Problems With Cash

Paying wish cash has its own problems such as:

• Theft:
  • If you lose your wallet or cash there is nothing you can really do besides hope its returned.
• Hard to Keep Track:
  • Its hard to keep up with all your expenses besides keeping all your receipts.
• Can’t Use Cash:
  • There are times when you cannot use you cash such as online spending.

Why Credit Cards Are Better

Credit cards provide a variety of advantages and ease of access:

• Easy for Large Purchases:
  • Credit cards allow you to make large purchases that normally take a long time to save for and spread those costs over a longer period of time.
• Expense Tracking:
  • Every time you spend using your credit card it keeps a record, making it easier to budget and keep track of suspicious activity.
• Credit Score:
  • Maintaining a high credit score is necessary to obtain a loan and a variety of other financial activity. Using a credit card builds your credit score.
• Rewards:
  • Credit cards can come with rewards when you use it responsibility.
• Safety:
  • When you lose your credit card  as long as your cancel it or lock the card your account is relatively safe. If their is fraudulent spending on your account you are generally not liable for much of it.

Problems With Credit Cards

Credit Cards come with certain disadvantages as listed below:

• Easier to spend more:
  • When paying with a credit card you are more likely to overspend since you may not be aware of how much you are actually spending.
• Must Apply:
  • In order to receive a credit card you need to apply, so if you have bad credit you will not be able to earn it.
• Fees:
  • Credit cards come with interest rates and fees that may exceed possible rewards.

Author’s Verdict

Both cash and credit cards have their place in today’s financial world so be sure to use the correct currency type to best maintain your finances.

Hopefully the above information helps you understand whether cash or credit is the better option for your finances.

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