Here's Why I Don't Use Cash Often

by Natasha Gabrielle | Updated July 23, 2021 - First published on July 1, 2021

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A parent pays for their family's cinema snacks with a credit card.

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Some people prefer to use cash over credit cards, but here's why I don't use cash often.

Everyone has their own unique personal finance habits and ways of managing their money. While some prefer to use cash for many of their purchases, I find that using credit cards offers many more benefits.

Here's why cash is not my go-to choice when paying for things.

I earn rewards on my purchases

I don't use cash often because I don't get rewarded for my spending when I use cash. Instead, I use rewards credit cards to earn points and miles on my purchases. To me, these rewards are like being given free money. I can redeem my rewards for gift cards, cash back, or even hotel stays and flights. Why use cash when I could be earning rewards?

I always make sure that I choose credit cards that make the most sense for my spending habits and needs. For me, paying for a card with an annual fee makes sense, because I earn enough rewards to outweigh the expense of the annual fee. Plus, I put many of my daily expenses on my credit cards -- so I spend a good bit with my cards each year. I'd rather earn credit card rewards instead of using cash and earning zero rewards.

It's easier to make returns

When I use credit cards, returns are simple and efficient. If I realize that an item is incorrect or not what I expected, all I have to do is show a receipt when returning it. Since I use a credit card to buy most items, the money is usually returned to my card without me even having to pull the card out of my wallet. Also, this means there's no need to keep track of store gift cards, which some stores like to give out when customers make a store return.

My credit cards offer fraud protection

If my cash is stolen, I probably won't be able to get it back. I may not even realize that someone took my money. By using credit cards, I get built-in fraud protection. I can monitor my statements and recent transactions. And if anything looks suspicious, I can quickly alert my credit card's fraud department and get the help that I need. They will do an investigation and return my money.

My credit cards come with added perks

The credit cards that I choose to use come with some great perks. These benefits include:

These added perks make my life easier, and I put them to good use. Cash doesn't come with these kinds of benefits.

Using my credit cards regularly helps me build credit

I've developed good money management habits over the years. I always:

  • Pay my credit card bills on time
  • Make sure that I don't have high balances
  • Pay all card balances in full

These behaviors significantly impact my credit score. As I use my cards and make payments, the credit card issuers report the data to the credit bureaus. As I continue to make good choices, that raises my credit score.

When I use cash, it doesn't help me build my credit. If I want to take out loans in the future or take advantage of better financial opportunities (like low-interest rates), I need good credit. Using credit cards responsibly and often helps me achieve good credit goals.

When used responsibly, credit cards can be a beneficial personal finance tool. It's important to only charge what you can afford and to pay your bills on time. It's also recommended that you pay your credit card balances in full to avoid expensive interest fees. Doing all of these things can result in responsible credit card behavior.

If you're considering what kind of smart money habits you want to create, you may want to consider using a credit card instead of cash. This can offer many benefits, and it can be a lot easier than remembering to get more cash from the ATM. If you're in the market for a new credit card, here is a list of top rewards credit cards.

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