8 Reasons You Should Still Carry Cash

Cash can really come in handy sometimes.

We're using less and less cash these days. Pew Research found recently that 41% of Americans say that none of their purchases in a given week are made in cash. This is up from 29% just four years ago in 2018. Cash-carrying habits also vary by age, with 71% of Americans over age 50 trying to always keep cash on hand, just in case, and only 45% of those ages 18-49 saying the same.

I've been making more of an effort lately to keep cash around. I had fallen away from it the last few years, but as it turns out, there are some situations that cash is really good for. To that end, I've promised myself that I will periodically visit an ATM (one that's in-network for my bank, so I can avoid paying fees) and replenish my supply of twenties. Here's why you should consider keeping some cash on hand.

1. Tipping

People who work in the service industries, like hospitality, food service, and personal services, really like cash tips. It's much easier for them than having to wait on a final credit card transaction summary at the end of a busy work shift, and if you hand your hair stylist a crisp $5 or $10, you can be sure they'll receive it (and will appreciate the gesture).

2. Making a small purchase

Small purchases are tailor-made for cash -- such as paying for a jukebox song, ice cream and other food truck treats, or a snack from a vending machine. Plus, some small businesses like neighborhood convenience stores have a minimum purchase requirement to use a credit card to make the credit processing fees they're assessed worthwhile. If you don't want to spend $5 or $10 to use your credit card, cash will definitely come in handy.

3. Cash-only businesses

Speaking of small businesses, you'll find some that are cash-only establishments. There are restaurants or small shops that don't want to pay for credit card processing at all and want the ease of cash. If you hope to frequent them, you'll need cash.

4. Emergencies and tech failures

Need a cab ride in the middle of the night? That cash behind your credit cards could save you if the cab doesn't take plastic. In general, it's a good idea to travel with a little cash at the ready for just such an emergency situation. And sometimes we encounter technology failures. If you're at the grocery store and their credit-processing system is down, you may have to abandon your cart of groceries if you don't have the cash on hand to cover your bill.

5. Quickly paying a restaurant or bar tab

As a person who hates wasting time, nothing drives me up the wall quite like waiting around for wait staff to bring me my check in a restaurant or a bar. Cash makes it possible for a diner in a hurry (if you have a good idea of what the total will be) by putting some money on the table and leaving.

6. Tolls and parking

While many states and tolling situations have shifted to electronic transponders like EZPass, not all of them have. For times when you need to pay tolls in cash, having bills or change in your wallet will come in handy. In a similar vein, if you find yourself paying to park often, cash can really be helpful here too. On multiple occasions, I've found broken credit card readers at parking garages and have been happy to have my little stash of cash.

7. Yard sales

If you enjoy yard sale shopping, you're really doing yourself a disservice if you don't carry cash. In fact, you may be able to score a better bargain by offering cash. After all, if all you have is a $20 bill and the yard sale proprietor wants $25 for that toaster, they may be willing to cut you a deal to get rid of it sooner.

8. Easy gifting

Cash makes a great gift in most situations and is very easy to stick inside a birthday or holiday card. Cash is also a great way to say thanks. My downstairs neighbors occasionally check up on my cats if I'm away, so I leave them some cash in a card as a thank-you for the favor.

As we submerge ourselves (and our wallets) in the digital world, it can be easy to forget that once, we all relied on cash. I don't know about you, but being a kid and getting a birthday card with $10 cash inside felt like becoming instantly rich.

It's important to note that cash doesn't come with the kind of fraud protections and security that credit and even debit cards do. If someone steals your cash, you're likely out of luck when it comes to getting it back, so make a reasoned estimate of how much you should keep in your wallet and/or at your home at any given time.

And of course, if you're keeping large sums of cash on hand, not only are you missing out on the security of plastic, but you're also losing the opportunity for that money to grow in your savings account or other interest-earning account. That said, as you can see, there are some parts of life where cash is still king.