There’s a perpetual question that many people ask as they make their way through the financial zoo that is life, and it ultimately often boils down to – cash or credit? Is there a best way to use these possibilities in order to maximize the satisfaction of life while also staying away from bad money behaviors?
The answer to that second question is yes, though sometimes you have to work for it. And that answer also entails lots of circumstantial reasoning, which will bring you back to the first question. So, your method to find out where you fit in the cash vs. credit riddle will be to learn about credit before using it, trying cash only for a while, to think about the benefits of auto-pay, to learn how to move money digitally, and to remember that it all looks the same on a budget.
Learn About Credit Before You Use It
Controlling credit card debt isn’t something that comes particularly naturally. It’s a skill that you have to work with over time, and one that you’ll get better at. But at the very beginning of your timeline when it comes to using credit (when you get your first credit card, basically), it’s important that you take the time to learn about things like interest rates before you even use it for the first time!
Try Cash Only For a While
Learning to live with cash only will teach you some important lessons about money as well. When you don’t have the ability to just swipe and forget, when you actually have to hand over physical representations of money, it will often make you think twice about what you’re purchasing.
The Benefits of Autopay
One thing that will help you overall in your budgeting is if you sign up for every autopay chance you can. This is a middle ground between cash and credit usage, and it will also make sure that you never have to deal with any late fees.
Moving Money Digitally
Another topic just outside of the cash vs. credit spectrum is the idea of moving money digitally. With credit, you don’t necessarily have the money to spend. But, if you use a debit card or move money through something like PayPal, then you are physically using cash that you have, but you’re just moving it around digitally, which gives you the best of all worlds.
It’s All the Same On a Budget
And finally, it’s important to remember that no matter how you use money, it’s all going to look the same on a budget sheet. If you overspend, it will come back to bite you. If you abuse cash or credit, then you’re going to find yourself in debt, wishing that you’d paid more attention to your finances before it became a problem.