Over the years, we have moved closer and closer to a cashless society, with credit and debit cards becoming easier to use with facilities such as Visa payWave and MasterCard PayPass.
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But is cashless the way forward?
Below are some pros and cons of both methods:
- Protected from security breaches – no personal information is made available when paying cash.
- Evade overspending – you are limited to how much you can spend. Studies have shown that it is psychologically harder to part with cash than a card.
- Avoid extra charges where establishments have a minimum charge to use eftpos.
- You are still able to pay in the event of technology problems, when eftpos communications are down.
- Handy for split bills in restaurants.
- Unable to utilise the convenience of apps, such as Boomeringo, that automatically track your spending and budgeting.
- If your cash is lost or stolen, it’s gone for good.
- Limited in making online purchases.
- Shopping for big-ticket items, results in carrying around large amounts of cash, which can be a safety issue.
- It can be a chore to replenish your cash budget each week.
- Convenience – it has become so easy to pay by card with Visa payWave and MasterCard PayPass, creating fast and efficient checkouts.
- Access to apps that can track spending, such as Boomeringo, to ensure you stay on budget.
- You are able to secure services, such as hotel bookings or car rentals that require credit card for security.
- Covered for fraudulent use on your card – the bank will usually refund any money lost as long as procedures have been followed.
- Having a credit card, and making payments on time, provides you with a positive credit rating.
- You can earn rewards with some credit cards.
- Access to extended warranties on purchases made on credit cards.
- Some businesses, especially smaller ones, charge a fee of around $2 for eftpos transactions under a certain dollar amount (generally around $10-$15).
- Some establishments don’t accept card payments.
- Charged many fees, from annual fees, to overdue payment fees, and interest is charged on purchases and cash advances.
- Susceptible to fraudulent use. If your card is stolen, there is an inconvenience of having to wait for new cards and refunds to be issued.
Some people prefer the ease of cards, others like to budget with cash. As you can see there are advantages and disadvantages to both methods.
Let us know your experiences, and what works for your budgeting. Share your tips with us and leave a comment below!
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