It’s 2018. Cash is dead, many people say. Plastic is all you need – credit, debit, gift cards. That or your smartphone can allow for payment pretty much anywhere. This is true for brick-and-mortar shopping or online web shopping. While that is undoubtedly a valid point, there are still many good reasons to carry some cash money in hand with you at all times, especially for emergency situations.
Cash Use Today
Cash use is definitely decreasing over time, but isn’t dead yet. At not in the United States, which we’ll focus on for the remainder of this article. According to the Federal Reserve Bank of San Francisco, utilizing identical metrics to measure payment method used in transactions in 2012 vs. 2015 reveal these interesting points:
- Cash still makes up the majority of all transactions. 32% in 2015, but declined significantly from 40% in 2012.
- Paper check use has remained mostly steady. Slight declines, going from 7% in 2012 to 6% in 2015.
- Credit card use has increased. 17% to 21% over the same period.
- Debit card use has also increased. 25% to 27% in the same time frame.
- Electronic payments have increased. 7% to 11% from 2012 to 2015 as well.
- Other forms of payment have remained mostly steady, going from 4% to 3%.
Other data has also borne out these facts. One study of data from 2010-2012 showed cash usage among developed countries ranging from 46% to as high as 86% of all merchant transactions.
More recently, trends have emerged demonstrating that the demand for large-denomination bank notes has increased since the global financial crisis of the late 2000s. Many people are turning to cash to store their wealth rather than investment instruments or electronic funds. A cash saver is a smart saver!
Regardless of conventional wisdom or jokes on TV, cash is still an important part of people’s lives. It’s still all about cash, America! At the very least, it should play some role in being prepared for unforeseen circumstances. Having some cash money in hand at all times is simply smart. We’ll review the pros and cons of carrying cash, the role of cash for, at the very least, emergency expenses, disasters, and general preparedness. We’ll also provide insights on common questions such as how much cash to carry, where to store or keep cash – both when carrying, at home, traveling, etc. – and provide some helpful links to excellent and unique products to store and carry cash in your daily life.
Pros and Cons of Carrying Cash Money in Hand
There are many pros and cons related to carrying cash money around with you. Likewise with storing cash in your home. In general, we’re focused here on having cash with you for use. This is in contrast to storing cash as a means of storing value outside a bank. We would always recommend against keeping large quantities of cash in your home or elsewhere for security reasons. With that said, some of the most important pros and cons to consider in regards to carrying cash are outlined below.
- Having cash money in hand allows you to pay for goods and services. This is true even if telecommunications systems, electricity, and related systems are offline. That’s something that can’t be said for things like cryptocurrencies, credit cards, debit cards, and related payment methods.
- Cash is secure and safe from hacking or other nefarious/malicious digital activities.
- A small supply of cash can act as a hedge against unforeseen circumstances. This can help with spending that might otherwise not be budgeted for.
- Cash retains fundamental value. This is especially true for major currencies like the American dollar. It can often be used or exchanged favorably in other countries and locales.
- In terms of value, cash is relatively safe. Obviously changes in a currency’s value will have an impact on cash. Nevertheless, it is a safe and stable asset, out of the direct reach of market fluctuations, runs on banks or bank collapse, FDIC collapse, or other nightmare financial scenarios.
- Cash is versatile – almost any establishment that sells goods or services accepts cash by default.
- Cash has no impact or reliance on your credit score, the way loans, credit cards, and similar do. If you’re struggling with your credit score, check out our guide to improving it, The 10 Best Ways to Improve Your Credit Score.
- Cash has no ownership affiliation. This means it can be used by anyone and is therefore prone to be stolen if left unattended or lost and subsequently found by someone else.
- Most cash transactions have no central, disputable record the way a credit or debit card transaction does. This means that aside from a store receipt, there is no good way to dispute a transaction.
- Cash cannot be used to make payments remotely, such as when online shopping.
- Cash in the home, a wallet, purse, or otherwise is not earning interest. A savings account, or other investment type, would serve better here.
- Carrying large amounts of cash can be dangerous. If you are indiscreet about that fact, it can make you a ripe target for pickpockets and thieves.
One of the best reasons to always carry some money in hand with you is for emergency expenses. Now, a little cash is not going to help in the case of a significant emergency expense. If you have to replace a home appliance or something like that, it’s not a huge help. Instead, we are referring to emergency or unplanned everyday expenses.
These may include things like needing to take a taxi home if you can’t drive for some reason. Or perhaps paying for a small, unexpected purchase. Paying a towing fee if your car breaks down is a good example. Having petty cash to make purchases from a vending machine at work or school is another. Similar expenses to these examples are all excellent reasons to carry some cash with you, at home, work, when out shopping, dining, or traveling.
Who Needs Emergency Cash?
While the specific amount you may feel comfortable carrying or setting aside for emergencies will obviously vary based on individual income, circumstances, age, region, and more (see How Much to Carry later in this article), even children can benefit from having a small supply of cash money in hand for unforeseen circumstances and emergencies. Gone are the days of needing quarters for the pay phone and things of that nature. Nevertheless, school vending machines and stores are still a cash business. A little cash money in hand can really help people of all ages out of a jam.
Putting things another way, there is always a risk of theft when carrying cash. But, in the grand scheme of things, losing a little money is minor. This is especially true when compared to potential inconveniences or problems that can be prevented by having a little cash available to you at a moment’s notice. After all, no one is going to break into your car specifically to steal your $50 out of the glove box. How could they even know it’s there? But if your car breaks down on the side of a rural road, and you really need to pay for a tow truck, that $50 can be a lifesaver. It’s well worth the risk of it being stolen at some point vs. the utility it provides in an emergency.
As unfortunate recent history has shown us, natural disasters are devastating and common. They can wreak havoc on cities, states, even whole countries. Earthquakes, wildfires, hurricanes, tornadoes, snow storms, and many more natural threats have continued to have an impact on the lives of millions around the globe. In some cases, modern, developed countries have had their entire power grids wiped out for months at a time. This leaves store supplies depleted, and daily life far more complex than people are used to.
In cases of natural (or for that matter, human-made) disasters, where telecommunications lines, power lines, and the normal infrastructure and supply chain for goods and services are disrupted, possibly for extended periods of time, having cash money in hand can be a lifesaver. With no power and/or no network connections, credit and debit cards are essentially useless pieces of plastic. But cash is still generally accepted, assuming the government behind it hasn’t collapsed. Having some cash money in hand may allow you to barter for limited goods or services. At the very least it should allow you to purchase the limited supplies that might become available. Basic water, food, and medicine are essential. You won’t be able to buy them with electronic funds.
General preparedness in daily life is also helped by having some cash in hand at home and elsewhere. Situations do not need to be emergency expenses or disasters to benefit from having some cash with you. For example, you might get stuck in a meeting that runs long one day at work. You miss your chance to get lunch, but desperately need something to eat before the day is over. Most vending machines don’t yet accept credit or debit cards, but almost all accept cash. Hardly an emergency or a disaster, but having some cash with you, in this case, will definitely make your day a bit better.
The same holds true for a myriad of other scenarios, such as having to settle upon a restaurant bill split with friends or have a few dollars to slip into a birthday card for a friend or relative whose birthday you nearly forgot.
Tipping is another good reason to carry cash money in hand. While most restaurants and similar establishments provide an opportunity to add tips to a credit card bill, there are many circumstances in life where no formal bill is provided, yet a tip is socially expected. These can include delivery persons, baggage personnel at airports, service personnel, taxi or limousine drivers, and other service-style jobs. Being prepared at all times to tip when expected or required is best handled by carrying cash.
How Much Cash to Carry
One of the most common questions with cash is how much should be carried. This will obviously vary based on a multitude of factors, including:
- Carrier’s age and maturity (especially with regards to children and teens)
- The local area, region, crime rates, etc.
- Income level
- Cost of living in a given area
- Individual comfort level
- Individual spending habits
Nevertheless, it is our recommendation that you keep several denominations with you. Typically, carry enough to cover one or more of the following (whichever is greatest in expense):
- An unexpected meal
- A typical product or service purchase
- Tips for an entire day or several-day local trip
- Sufficient funds to cover your normal daily expenses, in the event you lose your credit or debit card, or cannot use them to pay
Dos and Don’ts
Whatever you do, don’t just stash a $50 or $100 in your wallet and call it a day. A good mix of the denominations that you are most likely to use is a far better choice for flexibility and versatility, and less likely to tempt thieves. After all, flashing a few $50 bills around, or someone peeping into your wallet and seeing lots of high denominations, is far more likely to arouse suspicion or the likelihood of theft than a bunch of $10s, $5s, and singles.
We also recommend storing a small amount of cash (enough to cover a typical tow truck or other service fees, such as $50-75) somewhere discreet inside your automobile.
For traveling, in addition to whatever cash, travelers’ checks, or local currency you may carry, we also advise stashing $40-100 somewhere discreetly within your luggage (preferably carry-on/luggage that stays with you during travel), just as an added protection against emergency expenses.
For home storage of cash, though not the main focus of this article, it is recommended to store enough such that you could purchase 3 days worth of water and food and other basic supplies for your family at double their everyday prices in the event of an emergency. This roughly translates to the following for most parts of the United States:
- Single: $75
- Couples: $150
- With 1 Child: $200
- With 2 Children: $250
- For each additional person, add another $50-75 to the total.
Where to Keep Cash
Cash can be stored in a number of places to fulfill the above recommendations.
Autos and Trucks
For automobiles, storing cash in a discreet place, such as the glove box, in a particular document folder or inside a sunglasses case or something like that (so long as it’s easy for you to remember) is the best choice.
Travel and Luggage
For travel and luggage, as we said, storing inside a carry-on piece of luggage is the best bet. Again, you want to be discreet – we recommend keeping cash in a glasses case, camera bag, or another place that doesn’t immediately scream “I’ve got cash!”, but is easy enough for you to remember and relatively hidden.
In the home, cash is best kept in a safe or another storage medium. Failing that, a strongbox will often do well for larger sums of home cash. They are easily stolen and broken into, but they keep cash out of sight and relatively secure from casual theft.
Everyday cash is best kept in a wallet, which in turn is kept in a pocket or purse in most cases. For those who prefer not to have a wallet, a money clip kept in the pocket will also do. There are many brands and styles of wallets and money clips on the market to suit individual preferences. Just remember, if you remove your wallet or money clip from your pocket or purse anywhere other than home, to make sure you put it somewhere secure. For example, in an office, keep your wallet in a lockable desk drawer rather than out in the open.
As always, a little forethought, planning, and good common sense can go a long way towards helping you avoid theft, while providing the benefits of having some emergency cash on hand at all times.
Need a Place to Store Your Cash? Try These Great Products!
Now that you’re clear on the advantages of having some cash in your home, car, and in hand at all times, we’ve compiled some unique and useful cash storage and carrying products for you to consider.
This highly durable safe offers both electronic combination lock access. It also has an override key, so your valuables are always available to you, but no one else. It has double lock bars inside to prevent prying attacks. Further, it can be bolted within your home or office. This means thieves can’t just carry it off and cut it open on their own time at home. It is made from solid steel, with 0.4 cubic feet of storage space on the interior. This is about the size of a piece of paper, and then 7.5 inches in height. The exterior dimensions are also relatively small. This means it’s easy to conceal or keep in a discreet place. The entire unit is only about 7.5 x 11.5 x 10.5 inches – smaller than most compact microwave ovens.
For a slightly lower-tech, diversion-based method for hiding cash, these affordable stash cans offer plausible protection by tricking would-be thieves, snooping siblings, or anyone else into thinking they’re just bottles of deodorant. These are great around the home, office, or for travel, and hold cash, cards, keys, and more.
A good medium option between the previous two, this safe looks like it came straight out of a movie! On the outside it looks like a dictionary, complete with bookbinding and printed title. On the inside, however, is a small safe, 7 x 4.5 x 2 inches, accessed via a key. This safe can sit on your bookshelf with all your other books, keeping cash, cards, keys, or other valuables safe – hiding in plain sight!
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