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Be Wise With Money

Stop Using Credit Cards & Take the Cash Challenge [Calculators]

Cash: Is it the T. rex of currency?

person using a credit card

It seems as if cash is becoming the dinosaur of currency modes. Convenience plays a huge part in why credit cards have become the powerhouse of purchase transactions.  And understandably so. Credit cards offer convenience, less bulk, instant access, minimized liability if lost, payment options and personalization. Plus, they don’t require planning ahead.

It’s also easy to get caught up in the sound of cha-ching, cha-ching and the instant gratification of purchases now in your possession. But how do you feel when the bill comes? Are you ever shocked at how much you owe? 

Credit cards offer affordable payment options. However, if you read the fine print, most people are paying anywhere from 12% to 23% interest on their unpaid balances. If our savings isn’t getting even 1% interest and borrowing money costs 19%, hmmm … seems like it may not be a wise investment. Heck, mortgages are only in the 4% to 6% interest range!

Credit card use is not a bad thing when managed well. And for larger purchases or emergencies, it can be helpful. But if you cringe whenever you get your credit card bill, take the Cash Challenge.

Get started on the Cash Challenge

For one work week, avoid using your credit card, and only pay cold hard cash for your purchases. Debit cards are not allowed! Be sure to plan ahead to have enough cash on hand. Are you up for it? Dare a friend or family member to do it too!

Try it and see how it changes your perspective. Did using cash change your purchasing behavior?  Did you think twice before handing the cash over? Did you have fewer impulse purchases? Did you ask yourself different questions – like “do I need it now?”

Old habits can be hard to break, but have fun with the challenge. See if it doesn’t make you think a little differently about how you spend your money.

Tools you can use:

  • Read your credit card statement and see the impact of just paying the minimum.
  • Use a credit card interest cost calculator to find out how much more you may end up paying on credit card purchases.

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