It seems to me that with all the scary stuff coming out about how clever and unscrupulous rascals are determined to steal our money, rob us blind, by electronically tapping into our charge and debit cards and even our bank accounts, we should look into whatever means are available to reduce the likelihood of this happening. Sure, financial institutions and credit card companies try to play catchup by introducing new safeguards whenever a new fraudulent scheme is discovered, but these are usually some days late and a number of dollars short. One alternative is reintroducing an old-fashioned concept – using cash as in “cash and carry”.
Yep, for a long time cash was the acceptable means of conducting business. I’m old enough to recall when wages were paid in cash in a pay envelope. When we were first married, we divided up our cash into an accordion-style set of budget envelopes each week – you know. so much for rent, so much for groceries, and so on. Worked well – we couldn’t have an “overdraft” and we always knew the balance in our various “accounts.”. Simple, but effective.
Nowadays, business, government, and financial institutions insist on monetary transactions such as pay and other disbursements be deposited directly electronically into a payee’s account at a bank or credit union. This is convenient for the payer, but not necessarily for the recipient who then must somehow access the account, usually by writing checks or using a debit or credit card. But these have costs associated with them and point-of-purchase risks can be significant. Among the most lucrative sources of income for banks and credit unions are the myriad of fees associated with checks and debit or credit cards. Some are charges for using the service, such as an ATM, but a huge source of revenue lies with overdraft charges and interest on the credit and debit cards.Yep, individuals trying to access and keep track of their money face a whole bunch of problems that are complicated by scoundrels trying to pick their pockets electronically.
Okay, so what about using cash instead of writing checks or putting stuff on the card? Well, doing so whenever possible would reduce a person’s exposure to a number of these perils. One big risk to the card are “skimmers” – devices installed, particularly on gas station pumps, by thieves to steal credit card information. Prepaying in cash avoids that risk and a receipt is still available. Paying cash at restaurants also reduces the risk of card fraud. Would you believe we keep an envelope marked “eating out” with cash in it? Kinda “retro” but it serves the dual purpose of ensuring funds are available for restaurant excursions and keeping those sticky electronic fingers away. Another advantage of cash is that some businesses actually give a discount to cash customers because credit card companies charge the seller a fee of several percent. But there may be other benefits.
Not long ago “Fred”, a guy I’ve known for many years, asked if he could borrow one of our cars. His had had some kind of terminal event and he needed transportation to get to work while he looked for another. I agreed and, after a week or so, he asked me to go with him as he had located a candidate replacement and I could retrieve my car. We went to the dealer where Fred did the usual used car routine of kicking the tires, taking a test drive, and checking for obvious defects such as rust. When we sat down with the salesman, Fred pulled out an envelope filled with cash, announced how much money he had (which was less than the asking price), and requested his offer be accepted as the “out the door” figure. Well, the wait while the salesman “consulted’ with the manager wasn’t very long. Fred’s offer was accepted; the cash and paperwork were exchanged; and, Fred drove off with the car – having saved a nice bit of change by paying cash. How about them apples?
One thing about cash, however, is that the feds monitor bank transactions involving $10,000 or more in cash. Not long ago that’s what tripped up a couple of well-known politicians who were withdrawing large amounts of cash from their bank accounts. One was using it to pay blackmail, and the other was compensating a young women for demonstrating what must have been extraordinary talents of an intimate nature. You know, in addition to other possible benefits of using cash, there’s one more thing – the sight and feel of that green stuff. It sure beats that of paper checks or plastic cards. At least that’s how it seems to me.
Bill Taylor, a weekly columnist, may be contacted at [email protected]