3 Reasons Why Using Cash Is So Powerful; Cash Is King

After I started my credit card debt reduction in April 2007, I was forced to use cash some of the time. I say some of the time because I didn’t give up all my credit cards. I kept one for emergency use.

I began to feel that cash was king after I totally gave up all my credit cards and was approved of the debt management program (DMP). My debt management program application was approved in October 2008.

Since then, I have been using cash. I feel great using cash because there are no finance charges or late payment fees after my purchases.

Friends and blogging pals who are free from credit card debt or have positive cash flow always emphasize the power and importance of using cash; cash is king.

Here are 3 benefits I have reaped from using cash since my debt management program in October.

1. Know Where My Money Goes To. I must agree that the main reason I am in financial trouble is that I do not know how much I am spending. Most of the time, it’s not the big-ticket purchases that are causing the financial trouble, but rather the $10 dinner here and $4 coffee there. They do add up in the long run.

Having a certain amount of cash in hand on a weekly basis for my expenses does help eliminate this mindless spending.

2. Spend Less. According to studies, people on average tend to spend 12-18% more when they use credit cards than using cash. Understandably, it’s much easier to swipe a credit card through a machine than pull out the green stuff.

Using cash makes me and hubby to think twice before making any purchases. As a result, it makes us buy only things that we truly want.

3. Get The Best Deals. It’s amazing how easy it is to get the best deal at the local stores when I offer to pay by cash. The local retailers are so willing to lower their prices whenever I tell them that I pay cash.

Using cash to buy things, especially electronic products such as DVD players, televisions, computers, microwaves, air-conditioners and other electronics can save you more if compared to using a credit card.

There was once that hubby wanted to buy a new television that was priced at $499. He walked into the store and told the store owner that he really wanted that particular television but all he could pay was $300. After some talk, the owner agreed on that and hubby saved $199.

The more I use cash, the more advantages I see and get. Sometimes I do think why it took me so many years to truly understand the power of using cash. Anyway, it’s not late as long as I have learned my lesson and am willing to fix my financial problem.

With the recent credit crunch and looming recession, I am sure more and more people are going back to using cash.

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