There is an unending debate between choosing a cash-only or cashless lifestyle. You can dig through articles that support being cash-free. They claim that switching to virtual payments can make finances better and more convenient.
However, you would see some people managing funds effectively by relying only on hard cash. Then, who is right or who is wrong? The point of concern is which way will suit you the best.
You could be someone who does not want to give up the cash-free lifestyle. It has made life effortless, but at the same time, it has led to unnecessary spending. When your expenses surpass your financial capacity, you must adjust your preferences.
During such times, adapting to a cash-only lifestyle can help you in many ways. One of the most underrated benefits of doing this is you can spend within the set budget. You can pursue this step if you are out of the job and receiving assistance from the Government.
Even if you have to take out loans for people on benefits, repaying can be easier. You can cut back expenses considerably and save enough to pay back on time. Thus, when and how you can take advantage of switching to only cash will be decided by your situation.
In order to be able to understand when you must follow a cash-only lifestyle, you must go through this blog.
Evaluate the pros and cons of a cash-only lifestyle
The advantages of enjoying the perks of a virtual cash management system are undeniable. However, the perks of a cash-only lifestyle can be realised when you cannot afford to let your expenses increase abruptly. This happens when you have too much debt to downsize.
On the other hand, choosing cash over cards works wonders when you have an urgent financial goal to accomplish. Above all, if you want to be disciplined financially, this cash lifestyle will be a blessing for you. To get an unbiased view of how this way of living can be fruitful for your finances by exploring the pros and cons.
·      Advantages of carrying out a cash-only lifestyle
Remember the time when your parents were used to a cash-only lifestyle? Every month, it was a common ritual to take out a big chunk of cash from the ATM or bank once the salary entered the account. Then, the next thing they practised was to divide the money according to expenses or priorities.
If you analyse carefully, you can determine that their financial struggles are, to some extent, less than yours. Keep reading to find out more about how you cash in on this lifestyle.
§    Budget without any exertion
When you deal with cash only, you have to manage with limited resources. You have to draw out a certain amount of money, which should be used to cover your expenses. By any means, you cannot afford to spend more on unplanned things.
This is because you will not have limitless funds available at your disposal. In such a situation, budgeting can give out the best results. You can save the desired amount dedicatedly every month if you have automated the savings.
You need to map out ways to arrange funds for an upcoming expense. Your planning skills will be enhanced, and you will have better control over funds.
§    Debt accumulation will downsize
Sticking to cash will help you spend money on necessities. Again, if you earn well, you are able to spend on luxuries, but that is through planning. Sudden expenses are likely to happen a lot less.
This is because the money to spend without a plan will not be available. This will prevent you from shelling out your hard-earned money on unimportant things. When you spend on random things, you do not have enough money for other payouts.
This way, you face multiple pending payments. With time, these turn into debts, and your financial condition just deteriorates. However, with cash only, you do not have the luxury to spend without monitoring your expenses.
§    Your financial privacy will remain intact
When you transact online, it produces a paper bill or a digital bill. It is a document that concerns the money you have just spent. Besides, it may unveil some personal information that can lead to some privacy threats.
On the other hand, when you deal with cash only, there will be no trace of the money you have spent. You can get a paper bill, but it is not likely to have your personal information. No one can steal your identity to misuse it against you only.
Moreover, you do not have to update your login and password from time to time. All this will be possible since you will be transacting with hard cash.
§    No need to spend money on interest
When you use a credit card to sponsor purchases, you have to pay interest on the amount you have used. With a debit card, you have the threat of getting it overdrawn. After this, you will have to deal with overdraft fees.
All these occurrences can totally be avoided when you opt for a cash-only lifestyle. You will manage payouts with the amount that is available to you. There is no need for you to pay extra because you are swiping the credit card.
With cash, you will have no fear regarding overdraft fees. You cannot exceed your financial limit when dealing with cash only.
·      Setbacks of using cash only lifestyle
It is not that everything will be good about this lifestyle. There will be challenges that you must try to overcome to maximise the benefits. You must take note of the setbacks.
§    Building credit history is impossible
When you pay online or use a credit card, your credit history takes its shape. Besides, by borrowing money online and repaying it in the same manner, you let the lender report this to the credit agency. As a result of on-time payment, your positive scores start forming.
On the flip side, when you live in cash, you cannot show any trace of online payments. For this reason, building a credit history is a lot more difficult than using cash. With no credit history available for the lender to scrutinise, you lose a chance to apply for loans.
§    No way to recover stolen cash
Suppose you took out a large amount of cash from the bank. On the way back home, someone snatched away your money. It will be very difficult to recover the cash that has been stolen unless you have noted down the numbers on the currency notes.
In most cases, people are least bothered by this step. For this reason, you cannot think of getting the money back. However, it is possible when you transact online since everything gets recorded.
The bottom line
When you are unemployed and living on benefits, you may need a loan today from a direct lender. Getting financial help is possible, but you will have to do some research. Meanwhile, you can accept the cash-only lifestyle to eliminate unnecessary outgoings.
Although usual expenses will not subside, you can prevent yourself from spending on unplanned things. You will have access to a certain amount of money that is available in the form of cash. Thus, you will be under pressure to set your priorities.
Because of this, you will automatically discard outlays like you would for an everyday morning coffee.
