Here Are 13 Things You Should Only Pay For in Cash

Over the past few years, it seems that cash has been slowly dropping off the list of ways to purchase items these days. Apple and Google Pay have grown in popularity and are more convenient than visiting the bank and taking out cash.

Still, there are places when cash is needed and much appreciated. Using it at the following places is considered superior and much more practical than a credit card.

1. Gas

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One of the country’s biggest complaints is the surging gas price. The cost per gallon can vary from day to day. One way to combat this problem is to pay with cash. Most gas stations offer a discounted rate with a cash purchase over the use of credit cards.

In addition to saving money, there have been stories of criminals installing skimming machines to steal your data. It’s best to be safe and pay with cash next time you’re filling up.

2. Shopping for Secondhand Items

Secondhand selling sites like OfferUp, Craigslist, and Facebook Marketplace are easy and fun ways to sell used products among neighbors. Whether you’re the buyer or the seller, paying or accepting payment in cash is advised.

You never want to risk accepting a check that won’t cash, or an electronic payment that could expose your information to strangers. Cash transactions are instant, minimizing risks in any situation and it’s easy enough to make a quick stop at the ATM before you meet up. 

3. Overseas Vacation Shopping

Suppose you’re planning a trip to another country. Financial experts suggest you carry and pay for most purchases in cash. This can help avoid international transaction fees from your credit card company. Those small purchases can add up quickly and ruin your vacation budget.

Paying in cash for small souvenirs can also trick you into saving money. Suppose you only have a set amount on you. In that case, you may weigh your spending habits a little stronger and avoid the convenience of just swiping your card, thus leading to a purchase you regret.

4. Purchases You Might Return

If you’re making a purchase you’re unsure about, financial gurus suggest you use cash to buy the products. Why? If you decide to return the item to the store, you can get your money back right away.

You can still return the products if you shop with your credit card, but you will likely have to wait a few business days to get your money back. If you’re on a budget, you could be out of luck.

5. Small Businesses

Many people choose to shop locally at the small mom-and-pop shops in their town. It helps out their community and supports the business owner’s family.

Cash payments make these small business transactions much easier for local shops. Credit card companies charge a small transaction fee with each swipe. Although these fees are small, they can add up and minimize profits, causing small businesses to struggle more than their big box counterparts.

6. Rent or Mortgage Payment

Most mortgage or rent payments can be linked to a checking account, or you can pay with a credit card. You should always pay for this with your checking account. This way, the funds come from you directly, not your credit.

Some people believe using their credit cards can help them rack up points. This is true, but most sites charge 2% to 3% per payment. This can negate your rewards and result in a large balance on your account. Avoid the added transactions and use your cash when the due date comes.

7. Large Down Payments

If you’re financing a large purchase, such as a car, you will most likely need a down payment before approval. Putting the down payment on a credit card might be enticing, but financial advisors say this is a big no-no.

If you don’t have the money to cover the down payment, it might be more practical to put off the purchase and continue saving. If you can’t immediately pay off the credit card down payment, you’re setting yourself up for high interest rates and the possibility of harming your credit score.

8. Parking Meters

Have you ever found yourself venturing downtown for a fancy dinner or a night on the town? Often, these downtown streets are lined with street parking that uses meters for convenience. Unless your city has updated its technology, these parking meters only accept coins.

Instead of trying to find a corner store to make change, or get cash back, keep a small cup of spare change. A handful of quarters will keep the meter fed and avoid a frantic panic trying to find an ATM before the meter maid comes strolling by.

9. Bars/Nightclubs

Paying for your drinks at a crowded bar can save you time waiting and more time having fun with your friends on the dance floor. Cash transactions are so much faster than credit cards that you might even become the bartender’s favorite customer.

Using cash can also help you budget money for the night. Having a tab can cause drinks to end up on the wrong bill, which you’ll have to sort out. Also, credit cards have been known to disappear in busy establishments. Just play it safe and use cash on your next night out.

10. Tipping

When it comes to handing out a tip for a service well done, cash is king. Ask any server, bartender, driver, hair stylist, or other professional who works for tips, and they will tell you they prefer cold, hard cash.

Why? Well, the truth is that a cash tip will go directly to the worker. Tips put on credit cards are subject to taxes or could be distributed among the staff by management. The next time you feel like rewarding a person with a tip, do so in cash. They will greatly appreciate it.

11. Farmers Markets

Farmer markets are spectacular places to buy fresh fruits, vegetables, and household products from local merchants. They’re a great way to give back to your community and also a cheaper option than big-brand grocery stores.

When shopping at the farmers market, be sure to bring cash. Many local farms do not have the technology to take credit cards or simply can’t afford the fees they come with. Plus, doesn’t paying for a radish and a head of lettuce with a Visa seem silly?

12. Emergencies

Most financial planners urge their clients to create an emergency fund. This money is to be set aside and only used in the case of a financial crisis, like a loss of employment or medical need.

Building up the emergency fund will help prevent debt acquisition due to credit card use. While putting an unexpected expense on credit might seem reasonable, you risk mounting debt and interest fees. Be fiscally responsible and use the money on hand. 

13. Toll Roads

Have you ever found yourself on a road trip in a part of the country that you’re unfamiliar with? Often, these roads charge a fee or a toll to drive on them. While it’s becoming increasingly common for toll roads to accept credit, or bill by license plate, it’s always smart to keep some cash on hand if the meters are cash only.

I keep a small amount of cash whenever I am on a road trip. You never know when you pass through small towns and want to stop for a snack and a drink. Some of those small, convenient stores don’t accept credit, and the last thing you want is to be stranded and thirsty.