In today's fast paced world, it's easy to pull out the good 'ole credit card to pay for purchases.
After all, pulling out the cash, counting it, handing it over, and then waiting for change simply takes forever!
OK, so I'm exaggerating a bit, but you get the point – it might seem inconvenient to pay with cash, or easier to pay with credit. However, the next time you go for the credit card, consider the following benefits of using cash instead of your card.
1. Accrued interest adds up on credit cards
If you don't pay your credit card balance in full each month, then the interest you accrue on your purchases will end up costing you more than the original purchase.
With time, that $50 pair of shoes could end up costing you $100 or more, and the bigger the balance, the more interest you're charged and accrue over time. Interest compounds, so you're actually paying interest on the interest you accrue each month, as well.
2. Paying with cash vs. credit helps you keep your debt in check
It can be easy to get into debt, and not so easy to get out of it. In addition to paying more in total for purchases over time, you're also accumulating more debt if you don't pay your bills off from month to month.
Wouldn't it be nice to think that once a purchase is made, you're done with it done and won't be paying on it for months – or even years – down the road?