Cash vs. credit: Which is better to use?

Published: January 11, 2024
Cash vs. credit: Which is better to use?

Even if you rely solely on credit cards, you still have to use cash from time to time. Which one is better, credit cards or paper bills? It depends on a plethora of factors, starting with your financial goals and ending with your monetary habits. Here are the pros and cons you need to consider.


Credit Cards


Credit cards are a ubiquitous payment method as they provide an effective and quick way to pay for your Internet purchases, utilities, and other bills. One of the key pros of a credit card is building up a good credit history that will allow you to take better loans. Whether you use the cash advance app, a platform that helps you find an optimal lender, or your local banks, by building a credit score, you will borrow money at lower interest rates and get more favorable terms.

Other Advantages

•    Security. Fraud protection is one of the crucial pros of credit cards. For instance, if someone steals your cash, you have little chance of returning the entire sum. But if someone steals your credit card, you can immediately block it. A suspicious activity on your card will provoke a fraud alert notification from your bank, which is also a plus.
•    Cash-back Rewards. The cash-back apps allow you to save money by providing a rebate on your purchases. Luckily, there are a myriad of apps on the market, ranging from Fetch Rewards, which allows its users to gain reward points and exchange them for gift cards, to Upside, which provides cashback from restaurants and gas stations.


•    Interest charges. From late fees and interests to annual and processing fees, there are a couple of factors you need to watch out for if you are a credit card owner.




Using paper bills and change can also come in handy. Although you won’t get anti-fraud detection or build credit with cash, it still has its benefits.


•    Save Money. If you are paying with cash, you won’t need to cover the additional processing fees, which will save you some money.
•    Emergencies. Not all businesses accept cash. Small shops, gas stations, and mom-and-pop stores often deal with paper bills, as they want to minimize ACH processing fees, so it is better to have some cash just in case.
•    Travel. When on the road, having cash is a definite must. Whether you need to pay for a cab, grab a can of soda, or give a tip, having paper bills will save you a lot of trouble.


•    Withdrawals are costly. You are unlikely to have all your money with you. If you need quick access to cash, you will likely need to use an ATM at some point, which will cost you withdrawal fees.


When choosing between cash and credit cards, you have to account for their pros and cons. Although credits are more secure, it’s better to always have some cash on hand, especially in emergencies. Ultimately, you don’t have to use only one, as paper bills can easily complement your credit card use.

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