Money in Hand

Dvorkin On Debt: Cash Is Still King

After nearly three decades as a CPA, author, and financial counselor, the single most controversial sentence I’ve ever uttered is this…

“Cut up your credit cards and pay cash for as much as you can.”

That seemed old-fashioned in the 1990s, but in this era of Apple Pay and other “mobile wallets,” it’s downright archaic to many of my tech-addicted peers. Yet a new study backs me up, even though it didn’t mean to.

How we feel about the feel of money

Recently, a company called Blackhawk Network, a large distributor of prepaid cards, released its annual How America Pays report. It questioned 1,000 Americans and concluded, “New payment methods growing, cash and checks declining.”

Yet their own numbers paint a slightly different picture.

Sure, “68 percent of mobile payment users report that they are using the alternative payment methods more than last year.” That means they used their phone to buy items. No doubt, that will increase as the technology matures.

Yet here’s a stat from the study that’s not highly touted or as sexy: Of the 1,000 adults surveyed, “93 percent used cash over the last year.”

Of course they did. I’m more shocked that 70 adults in the survey didn’t use cash for an entire year. Compared to debit cards (68 percent) and credit cards (67 percent), that means cash is still king.


Giving cash some credit

Why is this so important to me? Because I believe cash is the best financial educator. As I wrote in my second book  Power Up

Learning to live without a credit card is an integral part of financial empowerment. The lessons you discover will add to your building blocks that will eventually lead to your financial independence. Those who don’t use credit cards take money much more seriously  than credit card users. The act of physically handing over the dollars to a cashier or waitress generates a feeling of loss. The money is gone.

Whenever I repeat this, which is all the time, I often hear this objection: “But Howard, carrying cash isn’t nearly as convenient as whipping out a credit or debt card!”

I’ve never really believed that, and now the Blackhawk study backs me up. Another buried result is this: “When asked to select the most convenient payment methods, consumers selected cash (93 percent), credit cards (92 percent), PayPal (90 percent), and retailer-specific gift cards (87 percent).”

So give cash-only a try, if even for a week. I guarantee you’ll save at least a couple dollars without losing any time.

Howard Dvorkin is a CPA and chairman of, an educational resource for those who want to conquer all forms of debt in their lives.

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